Shemaroo Entertainment

Another average set of numbers from the company, company is finding it hard to go beyond 100 cr. of quarterly revenues. Key highlight for me was that their broadcasting business will breakeven this quarter.

  • Expenditure on new ventures was 14.4 cr. (vs 14.1 cr. in FY22Q4) in this quarter. Expect this to be ~50 cr. in FY23. Will break even on TV broadcasting business (Marathi Bana, Shemaroo TV) by end of current quarter
  • Digital revenue breakup (48.1 cr.):
    o Youtube: >60% (29 cr.+ vs 24-28 cr. in Q4FY22)
    o Telco <10% (4.8 cr. vs 5 cr. in Q4FY22)
    o Syndication & ShemarooMe (remainder): 14 cr. (vs 14-18 cr. in Q4FY22)
    o Confident of growing this business line by 20% CAGR in next 2-3 years
  • Debt is 268 cr. (vs 248 cr.), inventory has gone up to 719 cr. (vs 715 cr.)
  • Shemaroo Umang started at #2 ratings and monetization has started in July 2022
  • Shemaroo TV ratings have increased by 70% from bottom reached 10-11 months back, advertising revenue comes with a 6-8 weeks lag
  • Shemaroo Marathi Bana: channel number was changed due to technical changes and Shemaroo lost 70-75% reach because of that + Star launched a Marathi movie channel. Shemaroo brought in episodic content to increase viewership. Surpassed earlier viewership numbers because of that (revenue should follow with a 6-8 week lag). Experimented with devotion content which delivered very good nos, then followed it with devotional serials (Ramayan dubbed in Marathi), and now trying general serials
  • ShemarooMe Gujarati has played out very well and company has captured a very large mindshare
  • Advertising pie: GEC (7’000 - 8’000 cr.), Marathi (900 - 1’100 cr.). From the three TV channels, combined revenue potential of 300+ cr. is possible in next 2-3 years
  • Launched telugu services in USA; tied up with a large telugu partner in India, used own marketing team in USA, currently free for trial until 15th August
  • In traditional media, syndication was a smaller contributor and most contribution came from broadcasting business
  • Performance linked incentive is paid in Q3, so that quarter will always have higher employee costs
  • Have not written off any inventory excluding the normal charging of inventory. Working on a new inventory policy as they now have newer revenue streams, nothing is finalized yet
  • Receivables are around 60 days

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

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