See more number of songs does not directly equals to more revenues. If that would have been the case then Saregama with 4x the number of songs as compared to Tips should had 4x revenues right? Tips has ~100 crores from Music licensing, whereas Saregama has ~283 crores.
It is the success of music track itself that makes you money, because your revenues from the streaming services depends on the stream share and not the number of songs that you have.
This recent movie of Salman- Radhe’s music rights were sold for ~30 crores from what I have read. And I don’t think that the movie’s music is that successful. So there is skillset that is involved in acquiring rights. And Tips management has prove themselves with new content acquisition. Saregama has already displayed that with some latest music acquisition from big upcoming movies, obviously at what cost they have acquired the same is not known.
On valuation front, I think people have to stop looking at P/E ratio as displayed by various websites like screener and all, because those ratios are direct calculation. TIPS market cap is ~1200 crores, music business PAT is ~40-50 crores. So Tips is actually trading at 20-30x earnings and not 50x or so that these screener and all would display.
And with music business being so profitable and growth possibility also being good; I think there is enough scope of valuation growth in the current market environment wherein even LaLa businesses have 20-30x valuations.