Star India, the country’s leading media conglomerate, reported a net loss of Rs 1,216 crore for the financial year ended March 31, 2019, as per its filings with the registrar of companies (RoC). The company, a wholly-owned subsidiary of The Walt Disney Company India, posted a net profit of Rs 287.7 crore in FY18, as per a report by The Economic Times quoting business intelligence platform, Tofler.
This was apparently due to higher expenses on its marquee sports property, the Indian Premier League (IPL), which rose to Rs 4,000 crore. In September 2017, Star India bagged the global broadcast and digital rights for the IPL for Rs 16,347.50 crore for five years (2018-2022).
The loss was also attributed to Star’s digital streaming platform Hotstar, which posted a net loss of Rs 558.38 crore on revenue of Rs 1,112.74 crore for financial year 2018-19. During the fiscal, Star India invested Rs 832.32 crore in Novi Digital, the holding company of Hotstar.
Data accessed by Tofler showed that the company’s total revenue from operations increased 35 percent to Rs 12,341 crore in FY19 compared to Rs 9,149 crore a year ago. Segment wise, revenue from advertising business rose 49 percent to Rs 7,311 crore, while distribution revenue climbed 9 percent to Rs 4,128 crore. Revenue from other sales and services doubled to Rs 902 crore.
The total expenditure for the year jumped 58 percent to Rs 13,707 crore from Rs 8,694 crore in the previous financial year. The surge in cost was attributed to a 66 percent increase in programming and operating cost to Rs 10,296 crore and 34 percent rise in employee cost to Rs 1,198 crore. Adding to the woes, the marketing cost spiked 57 percent to Rs 1,168 crore during the fiscal under review.
Star India’s regional entertainment business saw a 9 percent year-on-year decline in net profit at Rs 271.85 crore, while revenue was up 11 percent to Rs 1,445.10 crore during the fiscal.―Business Today