Shemaroo Entertainment

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580

Average set of numbers again, key highlight was launch of new TV channel in Hindi GEC space to take advantage of withdrawal of 4 channels from FTA space. Notes below.

  • Expenditure on new ventures was 14.1 cr. in this quarter and 67.3 cr. in FY22. Expect this to be ~50 cr. in FY23. Although, in Q1 this will be higher due to launch of Shemaroo Umang
  • Digital revenue breakup (47.1 cr.):
    o Youtube: 50-60% (24-28 cr.)
    o Telco <10% (5 cr.)
    o Syndication & ShemarooMe (remainder): 14-18 cr.
  • Confident of breaking even in the two TV channels in FY23
  • Debt is 248 cr., inventory has gone up to 715 cr. (from 700 cr. in last quarter)
  • Shemaroo TV viewership has doubled in last 9-10 months, this generally leads to revenue traction with a certain lag. Shemaroo TV is positioned towards male target audience (crime shows, etc.)
  • Launched third satellite Free-to-Air channel (FTC) named ‘Shemaroo Umang’ in April 2022 in Hindi GEC space (slightly different from Shemaroo TV as Shemaroo Umang is positioned towards female audience, drama shows). This was on back of exit of 4 major GEC channels from FTA space. In FTA space, there is 2’500-3’000 cr. advertising pie (the 4 GEC channels were accounting for 1/3rd of this). Tactically, it made sense to launch at this point of time as DD free dish auctions happen only once a year
  • Competitive market dynamics in MarathiBana? Currently there are 5 Marathi movie channels (3 from Zee) and 6th one will be launched soon. In free-to-air, there are 4 Marathi channels out of which Shemaroo is one (1 is GEC rest 3 are movie channels). Of the total advertising pie, management thinks that 20% of this would be going to FTA channels
  • Currently, Shemaroo TV (Hindi GEC channel) is doing better than MarathiBana
  • Expecting challenging quarters from advertisers in FMCG and auto industries in next 2-3 quarters
  • Traditional Syndication: Back to 60-70% of FY20 levels. It will not go back to earlier levels because of management’s focus away from this business line. A lot of content which was earlier syndicated is now used exclusively for own B2C initiatives
  • Expect ROEs to come back to 15%+ levels in 2-years

Disclosure: Invested (position size here, no transactions in last-30 days)

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