Media Sector

Overview:

The media business in India is diversified and expanding. It comprises a diverse spectrum of enterprises, from classic media outlets like newspapers and television broadcasters to newer digital media outlets like social media platforms and internet streaming services.

The Indian media industry is likely to expand dramatically in the next years. Several causes are driving this expansion.

Here are some of the major players in India's media industry:

Television: The television business in India is the largest section of the media sector. Star India, Zed Entertainment Enterprises, and Sony Pictures Networks India are among the leading companies in the television sector.

Film: The film business in India is the second largest part of the media sector. Bollywood, Kollywood, and Tollywood are the primary participants in the film business.

Digital media: The digital media business is India's fastest expanding sector of the media sector. Google, Facebook, and Amazon are among the leading participants in the digital media sector.

These are only a few of the significant players in India's media industry. The industry is home to a diverse spectrum of businesses and it is constantly evolving.

Key facts

• After the United States, China, and Japan, India has the world's fourth-largest media and entertainment sector.
• The industry is predicted to increase at a CAGR of 12% by 2025, reaching $35 billion.
• The television business is India's largest media and entertainment industry, accounting for 45% of the market.
• The film sector is the second-largest, accounting for 30% of the market.
• The digital media business is the fastest expanding, accounting for 25% of the market.
• The expansion of digital media, increased urbanisation, and rising middle-class discretionary incomes are predicted to fuel the Indian media and entertainment business.

Opportunities

The expansion of digital media: The number of internet users in India is continuously increasing. The rising availability of smartphones and other digital devices makes it simpler for consumers to access digital media. As a result, demand for digital media products and services is increasing.

The middle class is expanding quickly in India. The middle class is more likely to have spare cash to spend on media items and services. This is increasing demand for premium media material, such as high-quality films and TV series.

Growing urbanisation: Access to digital media is more prevalent in urban areas. They are also more likely to have a need for premium media material.

Challenges:

Fake news is on the rise, and it may be dangerous to the public. It can potentially harm media firms' reputations. Media businesses must be cautious about the material they produce and be open about their sources.

Global media corporations' rising competition: Global media corporations have the means to create high-quality content. They can also reach an international audience. Indian media organisations must find methods to compete with these corporations by generating content that is relevant to the Indian audience.

The government's regulatory problems include: The Indian government has a history of imposing rules on the media industry. These rules can make it harder for media firms to function while also limiting press freedom. Media firms must be aware of these restrictions and be prepared to comply with them.

Recent news

• The merger of Zed Entertainment Enterprises (ZEEL) with Sony Pictures Networks India (SPNI) has been approved by CCI: The combination of ZEEL and SPNI is predicted to result in a media behemoth with a reach of over 700 million viewers. Both firms' stock prices may rise as a result of this.
• TV18 Broadcast shares tumble as Mukesh Ambani's Reliance Industries sells a stake: The sale of Reliance's interest in TV18 Broadcast is interpreted as an indication that the corporation intends to depart the media business. This might cause TV18 Broadcast's stock price to fall.
• TV channel ad sales increase by 20% in Q1 2023: The increase in TV channel ad income is a good indication for the media industry. This might cause the stock price of media firms that rely on advertising income to rise.
• Viewership on OTT platforms increases throughout the IPL season: The increase in viewership on OTT platforms during the IPL season is a positive indicator for the digital media business. This might contribute to an increase in the stock price of media businesses involved in digital media.

Analysis

Revenue Growth: The media sector's revenue has been constantly growing throughout the years. From 2020 to 2021, revenue increased by 12.2%, and from 2021 to 2022, revenue increased by 10%. However, the sales growth rate fell to 8% between 2022 and 2023.

Operating Profit: The media sector's operating profit has gradually increased as well. The operational profit in 2020 was USD 1.4 billion, rising to USD 1.6 billion in 2021. It will climb to USD 1.8 billion in 2022, and USD 2 billion in 2023.

Note: The data for 2023 is a projection, and the actual revenue and operating profit may vary.

Here are some specific trends that I anticipate could arise in the near future:

The rise of short-form content: Short-form material, such as videos lasting less than 10 minutes, is gaining popularity in India. This is because social media sites like TikTok and Instagram are becoming increasingly popular.

The emergence of influencer marketing: Influencer marketing is gaining traction in India. This is due to the growing popularity of influencer marketing initiatives and the growing number of social media influencers in India.

The Evolution of Live Streaming: In India, live streaming is getting increasingly popular. This is because high-speed internet is becoming more widely available, as is the popularity of live streaming sites such as Facebook Live and YouTube Live.

Long-term view

The long-term view for India's media business is highly optimistic. In the next five years, the industry is predicted to increase at a 15% CAGR. This expansion will be fueled by the advent of digital media, the expansion of the middle class, and increased urbanisation.

ROSHAN PATEL

Disclaimer:

The following Report is intended for informational purposes only and should not be construed as financial advice or investment recommendations. It is important to conduct thorough research and consult with a qualified financial advisor or professional before making any investment decisions.