D. B. Corp Limited (DBCORP) Earnings Call Transcript & Summary

Ladies and gentlemen, good day, and welcome to the D. B. Corp Limited Q3 and 9 Months FY '22 Earnings Conference Call. [Operator Instructions] I now hand the conference over to Ms. Amrita Pujari. Thank you, and over to you, ma'am.

Thank you, and good evening to everyone. We welcome you to the D. B. Corp Limited Q3 and 9 months FY '22 Post Earnings Conference Call. We have with us today the senior management team of D. B. Corp Limited, Mr. Pawan Agarwal, Deputy Managing Director; Mr. Girish Agarwal, Non-Executive Director; Mr. P.G. Mishra, Group CFO; Mr. Mushtaq Ali, Vice President; Mr. Lalit Jain, CGM; and Mr. Prasoon Kumar Pandey, Head, Investor and Media Relations, who will represent D. B. Corp Limited on the call. We will be sharing the key operating and financial highlights for the quarter and 9 months ended 31st December 2021, followed by question-and-answer session. Before we begin, we would like to state that some of the statements made in today's discussion may be forward-looking in nature and may involve risks and uncertainties. Documents relating to the company's financial performance have already been in e-mailed to you and are available on the website of the stock exchanges and the company's Investors section. We trust you have been able to go through the same. I now invite Mr. Pawan Agarwal to share his outlook on D. B. Corp's performance for the quarter. Thank you, and over to you, sir.

Thank you, Amrita, and good evening to everyone, and thank you for joining the Q3 FY 2022 D. B. Corp Earnings Conference Call. Hope you and your family are healthy and keeping safe in the current situation. We will begin the call today by highlighting the key financial performance for the quarter ended December 31, 2021, followed by operational updates during the quarter. Let me tell you the first 2 quarters of the fiscal was seen as a precursor to the economy's journey to normalcy after a difficult FY '21. Although the second bears significant impact on economic activity partly affecting first half of current financial year, they were short-lived. And by the time the third quarter began, we had already begun witnessing signs of significant uptick. Third quarter, which had significant Indian festival, saw a strong rebound of activities, especially in the non-metro cities Tier 2, Tier 3 towns. And this was witnessed by the return of new and traditional advertisers in a very big way as we looked up to tap the pent-up demand everywhere. Consolidated revenues, advertising revenues grew by almost 8% at INR 3,951 million in quarter 3 FY 2022 as against INR 3,667 million in the previous year. And our circulation revenues stood at INR 1,141 million, higher by 6% on a Y-o-Y basis. And the total revenues came in at INR 5,495 million, higher by 11% on a Y-o-Y basis. And as a result, the operating profit stood at INR 1,459 million, which was helped by the continuing benefit of our overall cost control measures, which was slightly offset by higher newsprint prices, although we believe that these prices should settle back to normal in the next few quarters. Our consolidated PAT stood at INR 865 million in Q3 FY 2022. Moving to our digital business. Over the past few quarters, we had commenced implementing a strong and focused strategy of investment, which continues to show strong growth on a sustainable basis. We are focused on creating best-in-class ad-free user experience on our digital applications as well as websites, while maintaining high-quality insightful content. Our reader-centric focus continues in the digital sphere as well. And we've done this, recognizing the importance of having a very strong presence in the digital space to ensure that our readers continue to engage with us across mediums. And we are very happy to report that these efforts have yielded great success in a short span of time, the Dainik Bhaskar app monthly users have increased to around 14 million in November 21 compared to just 2 million in January 2020. What is significant in these results is that while we have been consistently demonstrating remarkable growth in our active user base, we also crossed the important milestone of achieving 1 million mark in daily average e-newspaper downloads. Of this, over 850,000 downloads are for Dainik Bhaskar Hindi and 150,000 for Dainik Bhaskar, Gujarati, making the Dainik Bhaskar Group the dominant #1 Hindi and Gujarati news app here, while continuing to be on course to further increasing the user base and extending the lead. The efforts of our digital team are overseen by an Advisory Board that has recently taken on board, Mr. Mark Thompson, ex-CEO of the New York Times, who has spearheaded New York Times digital transformation over the last decade. Apart from this, we've also focused on on-boarding experienced talent from the industry and our strong technology team as a consumer product and tech background and has been drawn from India's best consumer tech companies. We are positive that the team will continue to expand Dainik Bhaskar's digital journey this year as well. Coming to the Radio division. In the 9 months of FY 2022, our market share from MY FM has increased. Volume growth gain momentum across sectors such as lifestyle, real estate, banking, state government and FMCG for the quarter. For the Q3 FY 2022, the revenue from the Radio division came in at INR 376 million, higher by 29% on a Y-o-Y basis. With this, I would now request Mr. Girish Agarwaal to update us on the operating results. Over to you, Mr. Girish Agarwaal.

Thank you, Pawan, and good evening, everybody. And I hope that in these current days, everybody continues to remain safe and healthy. The quarter gone by has seen a strong return of both the Indian consumers to the market and for us, the advertisers also. This festival season, especially Tier 2 and Tier 3 cities, have seen a remarkable resurgence of demand, and this was visible on the ground. In fact, on -- our advertising revenues are a testament to this fact. Our well-calibrated circulation strategy has enabled us to not only increase our circulation to bring it to the levels of immediate pre-COVID, but have also been able to do so along with the cover price increase in select markets, which is being rolled out on a select-city basis. We still see headroom for possibility of yield increase in our newspapers' cover price and we'll continue to review and execute the same in the coming months and year. We are confident that our leadership position in the market that we operate in will only enhance in the future. On the advertising front, undoubtedly, the festival season has been very good. But we are also beginning to witness newer sectors looking for geo control ad campaigns and new edge players looking to tap the non-metro markets all coming to us. Given our wide reach and strong editorial integrity, that resonates with our readers. This has helped us in delivering growth on these numbers. There is a paradigm shift happening in the way advertisers are looking at Indian language newspapers in Tier 2 and 3 cities. On our financial performance and cost optimization, if you recollect during our last interaction, we had advised you that we continue to focus on sustainable cost optimization. And therefore, we will see resulting improvement in our margins. During the last financial year, we have saved around INR 195 crores in these operating costs, and we had indicated to you that 45% -- around 40% to 50% of these savings are sustainable. We remain committed to this cost optimization and are happy to report that in the 9 months ended December 31, 2021, we exceeded our targets of 50% of this achievement and we were able to take this saving up to almost 65%, 70% of FY '21's cost saving. Resultantly, the print business EBITDA in Q3 of FY 2022 came in at around INR 1,590 million with an EBITDA margin of 31%. Our current -- also important, I want to announce that our current pledge of shares from the promoter side has now come down to around 4% with a loan outstanding of only INR 25 crores, and we are working towards clearing the same in next 2 months' time, as we already communicated with you. That is all from our side. And therefore, my colleagues and I would be happy to respond to your questions. Thank you.

We will now begin the question-and-answer session. [Operator Instructions] First question is from the line of Himanshu Pathak from Oaktree Capital.

Congratulations on good set of numbers. Really hard forming numbers with a 92% circulation coming back and even the revenue, the ad revenue is coming back. It's a very good and a pleasant surprise. Okay. So really appreciate the amount of work which has gone in the business.

Thank you, sir. Really appreciate it. Thank you.

Now my first question was we had investment properties in lieu of -- in advertisements of INR 94 crores in March 2021, okay. What is it currently? Secondly, with revival of real estate, can we expect this to reduce to below INR 50 crores? And finally, are builders having the strength to be more in check than in area for sales for -- means we are seeing revival in real state, and we have also spoken, so hence, this was -- this is one question. So if you can elaborate on these 3, I will -- it will be helpful.

Yes. So on the real estate barter side, as you are aware that from last few years, we are not doing any further barter because we already have enough stock piled up. We've been able to liquidate some numbers, almost -- last quarter itself, we've been able to sell around 8, 10 properties. We have recovered some money. But at the same time, some positions, which were not earlier with us, has been added on to our [ listing ]. So our endeavor is that, that we want to liquidate as many properties as we can do as fast. What we -- and which we are in the process. So we've been finalizing. In fact, we have now signed up a deal with a couple of the builders on buy-backing the property. So for example, if we have done a barter with, say, INR 5 crore value with a particular builder, so we are requesting them, because the market is an upside, they are able to sell the property better than us. So we are giving that back to them and taking money, cash from them and giving them slightly extended credit period so that they are able to pay that money to us. So we are all-efforts on it, and I'm happy that maybe next quarter again, we'll come back to you with a list of at least 10, 20 properties for the full [ year ].

Okay. And one more thing. We are hearing that the inventory is pretty low in real estate and number of launches are increasing almost in all the markets, okay? And we have presence in some of the larger markets like Patna, [ Indaba ], Jaipur. Are we doing anything special to get more share of revenue from this particular segment? Because this is the most reviving sector as of now, even better than autos and some of the other segments which we are doing earlier better. So thoughts on your special efforts if you are voting for this segment to get more revenue?

Yes. Certainly, so in real estate category, we have certainly seen an uptick. If you see Q3 itself, there has been almost 13% growth on Q3 in terms of real estate advertising with us. Apart from that, in most of these markets, we are trying to be innovative to see how we are able to help these builders to liquidate their properties. Unfortunately, in the December month, we lost out some traction because of the COVID. The government guidelines were not allowing people to hold real estate [ mail-out ] property exposition and all that. But I think this is one area where we are focused on, and it is one of the top category for us right now.

Okay. One last question. On the paper price, we have said that we expect the paper prices to come off. What is the current trajectory? And when we see the inventory, the inventory days have also reduced, okay. So has there been an absolute number reduction in the inventory days or that means they're [ encouraged ], or it is just because the revenue has increased, so the inventory days are...

Yes, the revenue has increased for 2 reasons. As you know that we have taken the circulation cover price increase. We have increased the cover price. Our average price realization has gone up by almost 7% in this quarter 3 itself. And also, if you see the cover, our further working on this, that there is a headroom. We still believe in the cover price, and we want to increase the cover price going forward also. So maybe because of that, that has happened. But having said that, the newsprint quantum to acquire right now from the market is still a challenge as well as the price.

Our next question is from the line of Aditya Sen from RoboCapital.

So in the previous con call, in quarter 2's con call, it was mentioned that price hike will happen in quarter 3 and quarter 4. So are there any further price hikes going to happen in the next financial year?

This price hike, you're talking about the newsprint or the newspaper?

Newsprint.

Yes. So let me give you the number.` Last year, in the quarter 3, we were in the range of around INR 35,000 a tonne. This year, in this Q3, the prices are almost around INR 44,000 a tonne. And going forward, it looks like that next couple of quarters are also going to be on the growth trend only because the market demand and supply, the ratio and also the mills are trying to convert themselves into the packaging newspaper, packaging papers and hence, the focus on the newsprint manufacturing is less, and they're asking for the price.

Okay. And just one more question. So in the last con call also, you mentioned that our market share was supposed to increase. So what's the current scenario? What is the current market share that we have?

In circulation terms, our market scenario, market share in state of Rajasthan, Gujarat, Madhya Pradesh has certainly gone up, including Haryana also. In the advertising, numbers from the market share perspective, I'm happy to inform that in Madhya Pradesh, in Rajasthan, Gujarat, Haryana, even Bihar, our market share has improved.

Okay. Can you give us a figure, like, what's the market share in terms of percentage?

You will appreciate we don't disclose that state by figure because of the competition issue. But if you see the overall number, the numbers are increasing by at least 1% or 2% in each market.

[Operator Instructions] The next question is from the line of Shivam Saxena from ICICI Bank.

So just wanted to understand how has this Q4 been panning out because of this -- this was a -- Q3 was more of a festive season. But in Q4, are you seeing some spending cuts from advertisers or some -- because of Omicron also. Are you seeing any -- some downtick in the advertising volume or advertisers or circulation, anything because of this Omicron?

Let me give you the flavor of Q3, which can help us understand Q4. If you see the Q3 number of this year, and I compare them with pre-COVID Q3 number of '19, '20, we are currently at 93% of Q3 of '19, '20. That, too, without the government advertising, this year, with us. So if I include the government advertising, then actually, we are slightly better than the Q3 of '19, '20 also. That clearly indicated that the print advertising has come back to the normal level. Unfortunately, from December 15 onwards, the third wave started coming in. It impacted the market. And January, as we see currently, also was impacted by that. Fortunately, this January 26 -- that January 26 is supposed to be a big advertising day for us. It went up by 3% over 2019. So things, as of now, looking like coming back to the track. But keeping our fingers crossed, because what happened, the moment the number of cases goes up, state government announced the [ conditions ] on the number of people going to be out. Like, for example, January is a big wedding month. But because of restrictions of 50 people, 100 people in the wedding, the entire thing goes down. So I think that is one thing which is still bothering us. We are hopeful that this whole thing is almost behind us now so that the month of February, March would be there in full swing.

Okay. And also on the newsprint prices, when you are seeing it will peak out? So are you seeing it will continue to moving up? Or you have said that it will come down, but what is your top -- any thoughts on that? Any...

Frankly speaking, on newsprint, every possible assumptions, what people have made across the globe has gone for a toss. So we are not sure whether this has peaked already or will peak out in next quarter. But as of now, what indications we have for at least next 2 quarters, the numbers will increase.

Okay. And the last question is on the number of new advertisers, you are saying that new advertisers are coming. So any thoughts on that key -- we have new hedge companies are coming or what sort of old advertisement is there? So basically, the brands are -- the more brands are getting advertised. I just want to understand that, or the old is more? What is the proportion of new and old, if any thoughts on it?

Certainly, the old -- when you say old, it slightly looks derogative to them, but they are not old. Companies like Tata Group or Reliance Group, they are still advertising big way with us. But at the same time, with the new advertisers, for example, the cryptocurrency guys, the mobile app guys on the health and the grocery and all that, they are also coming in, advertising big way with us. But that quantum-wide, if I look at the traditional established advertisers are certainly on the higher number.

Our next question is from the line of Varun Bang from Reliance PMS.

Just want to understand on your advertisement for government, have we started seeing any traction there? And what is your expectation?

Unfortunately, for some unknown reason, the government advertising for our group in few states has been -- not been coming to us last almost 2 or 3 quarters. But we are hoping that they would like to advertise with us so that our readers get their message. So I'm sure in the next couple of months, that will come back to us.

Okay. All right. And sir, we have reduced new additions in markets like Madhya Pradesh and made one addition there. So any more opportunities to reduce further where do you think there is...

No, no, we are not reducing anywhere. We are only optimizing the printing editions, where all we can do the more optimization of the printing presses.

Okay. Okay. Well done. And on number of advertisers, you said you are seeing strong traction. Can you please share ballpark numbers, how much increase you see in advertising, both on revenue as well as, as a percent?

Revenue numbers are already with you. We have grown by 24% in the 9 months. But the number of advertisers, I'll have to get back to you on that.

Okay. And lastly, on strategy for new markets. So would you like to focus on strengthening presence in the current markets? Or we are looking to get into new markets? So what is your strategy there?

Absolutely, our focus from last couple of years has been on our existing market because we strongly believe that markets of Gujarat, Bihar, Rajasthan, Madhya Pradesh, Haryana, Punjab, they still offer a huge opportunity for the group. So we are working on that -- these markets only.

Next question is from the line of Sidhant Mattha from B&K Securities.

So 2 questions. First of all, for circulation revenue. I had -- so there is a slight Q-on-Q decline. I mean, in the last few years, there have been -- so mostly flat only. So are we seeing some pressures in volume in circulating copies? Or is it just a seasonal factor? And how do you approach care facilities?

See, what is happening in circulation, we certainly have lost some copies. As we mentioned to you, we have the 90%, 92% of our immediate pre-COVID. So what copies we have lost is the [ realization ] copies. We have lost some office copies, marketplace copies and also some residential copies, I must say that.

But -- not from the -- from Y-o-Y perspective. I'm talking about a quarter-on-quarter perspective. Like has there -- is there some pressure in circulation copies or has circulation copies gone down quarter-on-quarter?

No, quarter-on-quarter, there has been growth. But I'm actually talking about last 3 years. Because see, I have to -- whenever I was at the top, if I was at a particular number and I need to go back to that number or at least going as close to it again, rather than being happy that from last quarter I have increased. I still have a long way to go. So our focus is that how do we gain those copies which have been stopped in the offices or in the marketplace, how we can attract people back that, okay? Because uncertainty, because what happened 3 months good, then suddenly market gets closed for 15 days. So shopkeepers and all that, they are not able to start the newspaper. So we are trying to convince them that you may continue the newspaper in your shops and offices also.

Okay. And the 7% number you gave earlier about realization, what was the -- that was the Y-o-Y number in cover price? Or what was that number I missed?

It's a Y-o-Y number on the realization of the average cover price.

And my last question is regarding we have seen some -- we have seen other expenses growing around 28%, that then will reach the third quarter of FY '20 level. I know you have been staving a lot of costs, and that's a very good sign. But has there -- is there some one-off in this quarter? Or do you really expect the similar in going forward also?

Okay. There are 2 things in this. One is there is an element of almost 32 -- actually 40% element is of the digital. So digital is growing, so we need to spend some money in the marketing and over there. Apart from that, within the other expenditure, there's an increase of the Indian play, certain business promotion, which are revenue-based. So I'm incurring the expenses of the business promotion here, but I'm also adding on that money into my revenue. For example, organizing a real estate expo. So if I'm spending INR 1 crore in organizing the expo, which is shown as expenses here, but there's a INR 3 crore revenue in advertising revenue over there. Also, there are 1 or 2 heads which are shifted from manpower to the outsourcing here. So that's also shifting and shown into the other costs.

The next question is from the line of [ Yash ] from JK Associates.

So my first question is with regards to the ad revenue. Now I just -- was just listening. So the yield, I believe, continues to be under pressure, but though there has been an improvement sequentially. Could you please let us know how much has the volume increased in terms of the pre-COVID Q3 FY '20, if you can just give us that number in terms of percentage.

So I -- the top-line number, what I have is that if I compare the Q3 of '19/'20 to Q3 of '21/'22, we are at almost 93% of '19, '20. Having said that, the pressure is -- on the yield is there. But I would say the pressure has now been stabilized. Now whatever growth is coming, it's from the volume only.

So how much is in terms of recovery or in terms of growth?

I would say the entire money, which is coming back is from the volume only, because yield is already fixed. This is not the time to go and ask anybody to increase the yield. It’s more the time to talk about the volume coming back.

Okay. And what about the copies that you have? .

Circulation copies in this quarter, we are doing, 1 second. 43.4 lakhs is the average copy for the Q3 this year.

Okay. And where are we in terms of year-on-year or. Probably...

Year-on-year, the same. 1 year back, we were at 43.8. So there has been 40,000 copies decline over last year.

Why is that the case, if I may ask?

That is also because of the December month third wave coming in. We stopped selling copies there.

And in terms of -- I mean, as compared to 2 years before, we are at around 95% is what you said.

Around 90%.

90% .

Yes.

Okay. And Newsprint, like you said, we are at INR 44,000 for the quarter.

Yes, INR 44,000 for this quarter.

Our next question is from the line of [ Amit Kumar ] from [ Determined Investments ].

I just had one sort of small follow-up. You did mention that January, you've seen a little bit of impact because of the Omicron wave. I just wanted to sort of get a sense of the quantum of the impact, because a very, very clearly, the first wave and then second wave and first quarter of this fiscal was to be intense. But when we were talking to companies, really, of clients, Omicron doesn't seem to have that much of an impact, really. So I mean, are we talking like a few percentage points here or there? Or it could potentially be, like, a 10% impact in terms of advertising?

Around 10%, plus/minus.

But that's January? Or you're sort of anticipating some improvement during the quarter as well?

For the month of January, as of now, since we are sitting on our closure of January, the impact has been around 10%.

Understood.

Negative, actually.

Next question is from the line of [ Darvesh Sangoi ] from [ D.S. Associates ].

Sir, thank you for updating the numbers on the app users. Can you throw some light on where we are on the Google revenue, which you were -- you had mentioned some couple of quarters ago?

So sir, as you are aware about that Google was not able to take the publishers along, and there's a body called DNPA, Digital Newspapers Association. They have filed a complaint in Competition Commission of India alleging that Google has not been fair and using the unfair practices and involved in the [ monopolistic ] activities and all that. Based on that, CCI was kind enough to order a probe against Google on this. So we are waiting for that. Once that gets over in a couple of months' time, we'll have more clarity about how Google and our relationship go in future.

And what about the other players, similar stance? Or some development on the other players?

Some companies had succumbed to the pressure, and they have done some side deals with Google. I really won't know much detail on that.

Okay. Also, one of your competitors has launched the NFT platform. Where are we as a company on that?

Sorry, what platform?

NFT, NFT platform.

Pawan, you would like to answer that?

We are still evaluating what the commercial sense and user adoption of that. We are still in the learning phase of it.

Next question is a follow-up question from the line of Himanshu Pathak from Oaktree Capital.

Can you tell us about how much has been the utilization of capacity for our radio advertisement versus last quarter? And what is it currently in Q4? And any improvements in rates have you seen in radio side? The results have been good, so just to understand what -- how you are thinking about that business.

So in radio, the good news is that we, of course -- we have grown over last year. We've also grown over the year '19, '20. We're about 1% positive on '19, '20. So you've got the base back. We are now only working on getting our yields back. And once the yields are back, we should be very robust for a strong double-digit growth this year.

So the utilization is full. How much would it be by this...

So utilization, our inventory utilization across the network is sitting at about what we call it how many minutes we play per hour, which is at about some 14, 15 minutes across stations. .

Okay, okay. And we also said about newsprint prices will continue to increase for next few quarters. Any improvement in rates for newspaper advertisement do you expect? Or you can -- the -- more edge will keep on coming. So just your thoughts on how to -- how would you see the raw material and what you are doing about it, some thoughts on that?

Sorry, I missed that question. Can you repeat it again for me, please?

Yes. So I was asking on the newsprint prices are increasing, and we expect them to further increase, okay.

Yes.

So what are we doing on the revenue side? Are we seeing any improvement in rates for newspaper advertisement?

As I mentioned to you a couple of minutes ago to somebody else's question that maybe this is not the right time to ask for a yield improvement. We are looking for -- gunning for more the volume back in the market. Because advertiser is also pressed. For example, if you look at the 4-wheeler category, they are down by more than 50% advertising value and volume growth because they are not producing anything much. So idea is that if they start producing, they should come back to the market advertising. And once things settle down, we can already talk about rates also.

Okay. Okay. Because some of the other categories are doing pretty well where you hit it, like, real estate where you are doing special [Foreign Language] and all those things.

Yes. But over the real estate, yes, in some cases, we have been able to do something, but nothing worthwhile to talk about, to be very honest.

Okay. And 1 last question. Well, you've done a pretty good job in getting digital subscribers, okay. But the 1 important question still remains, how and what would be the metrics you will utilize to decide when to commercialize, okay? Because the product may be great, okay? But selling is an equally important part and a challenge, okay? So how do you decide that, that moment of truth or time to commercialize has come for you?

I think we all are waiting for that eureka moment, and that's $1 billion question you've asked, and we all are searching the answer for that. But having said that, I strongly believe that today, from 2 million, we are at 14 million. And if we are able to take the journey ahead, then I think the day when we can start asking people to pay us something for that won't be too far. .

Okay. And one small thing. Globally, there have been platforms where -- which were not charging and then they started charging, okay? So generally, what is the drop rate once the platform becomes chargeable? Any study you would have done across the globe? Because -- and what are the results of those studies, if you would have done some?

Let me explain you. So what happens when the platform becomes chargeable, people don't drop out. Why? Because it's like they put a gate entry after certain articles. So for example, if you are reading articles on my website, on my app, so maybe a couple of paragraphs are allowed for you free. But if you want to go deeper in the article, you may have to subscribe and pay for it, or you are allowed 5 articles or 30 articles, 10 articles free in a month. But if you are reading more, then you'll have to pay for it. So people, those who don't want to pay, there's 10 within that zone of free. But some people, do who feel them, "I want to read everything," as such, then they pay and get into the main hall. So similarly, there is no drop. But what happens if you have, say, 100,000 people, those who are reading your app on a particular time in a day, maybe 10% are paying for everything and 90% are still enjoying the outdoors articles of it.

One last thing. So currently, we are not even advertising or letting advertisers come on that platform, okay, and not charging also. So how would we decide that, first, we want ads to come? Or we want to start getting paid for the services.

I think very valid question, and let me answer that. We have understood now that our readers have got used to a particular environment, and we are planning to start advertising in the next couple of months in a very subtle manner, where it doesn't become very intruding for the reader. At the same time, it helped us in that revenue purpose also.

Okay. And one small suggestion, sir.

Please, sir.

See, in this media industry, everybody is evolving. But still, the fight is at the perception, okay? And the investor or the sentiment is that this industry will not survive, okay, which is a contrarian -- which I am a contrarian to that part. I think we make decent amount of money. We pay once in a year dividend. But just in the signal to the market that we will be a regular dividend sales quarterly and we believe in the sustainability of the business as a sustainable, profitable business quarter-by-quarter. It might help in changing the perception of it. So this is one suggestion I have.

So I think you have a very valid point, suggestion noted. I will certainly table it to the Board. But I just wanted to add on to this. If you look at the history of D. B. Corp, we've been a regular dividend-paying company. And we announce dividend quarterly also. There would be some exceptions in few quarters, where the dividend has not been announced for some reason. Otherwise, we've been announcing dividend. And also, the company has a policy that we don't keep any excess cash in our -- on our balance sheet. So whatever is the requirement for the company, we keep that, very little amount. And balance always is announced as a dividend.

Yes. So the quarterly may help in changing the perception and the fight is with the perception currently for the industry.

I appreciate your point, sir and will certainly table it to the Board.

Our next question is from the line of Anish Jobalia from Banyan Capital.

Congratulations for a great quarter. Now if you look at advertisement, was this pre-COVID, we are down by 7% and versus certainly -- and in the circulation, we are still down by 14%, right, despite the fact that the circulation has recovered much faster than the advertising. So I think that's a fantastic execution from your side. Sir, given now your initial commentary around very strong sentiments from advertisers and also you mentioned about the Tier 2, Tier 3 or Tier 1 towns. So now given the -- this quarter, we are down to only 7 -- sorry, we are down by 7% versus pre-COVID, so can we say that with the kind of sentiment that has now come back, we are going to be back to the FY '20 revenue levels in the advertisement, especially in FY '23, so what's your outlook around that if there is no lockdown quarter like Q1, which we saw in this year?

Sir, our COVID costs are somewhat low, may advertising, somewhat lower. So if you -- if somebody can say that, okay, there will be no COVID issues happening, certainly, we are more than confident to deliver the numbers, what you are just mentioning. Look at this 26th January number. On 26th January number, in spite of all the odds, we delivered a 3% growth on that particular day compared to 2019 also. So I think we are all geared up to say that, yes, as the market improves, the condition in the market improves, we are all set to take the maximum advantage of that.

And sir, what is -- which are the sectors which are driving this? If you could give some color around that would be helpful, sir.

So education, real estate, jewelry, our new mobile app like grocery, health and all these guys are the major driver for the business. The downers are automobile, lifestyle, government.

Okay. So you are very confident that the sentiments of our advertisers have come back very sharply. And obviously, we are making our own efforts to improve the quality of our product and improve the market share, et cetera. So if there is no turbulence in terms of the lockdown impacts going incrementally, then we'll be crossing the FY '22 -- '20 levels in FY '22, right?

That's what we are all working on.

[Operator Instructions] The next question is from the line of Aditya Sen from RoboCapital.

Most of my questions are already answered. I have just 1 question left that do you have any guidance in terms of margins going forward?

Sir, as we indicated to you that we are 7% away from the '19 number in the Q3. If everything goes well, January, as we had mentioned to you, around 10% plus some down over '19 again. So if we are able to see the February, March clear from the market perspective, and I think things are looking pretty good.

Okay. So can you assume that by Q1 FY '23, the 7% will also get covered given that we have a 10% shortfall this month?

Let's hope for that.

Sorry, can you please repeat?

Let's hope so.

Our next question is from the line of Lux Chen, as an institutional investor.

Am I audible?

Yes, sir.

Yes. You have mentioned that there has been an increase in newsprint cover price, right?

Yes, sir.

And is this price able to cover the newsprint cost?

In some markets, yes. In some markets, no. It depends on the market to market. So that number I gave you, the average number of the company.

Okay. Okay. And in some markets, are we able to get profit also only from this newsprint cost, covering the newsprint cost?

No, sir. Not yet.

Okay. And are we planning to enter into business newspaper?

No, sir, we have no such idea. We already have a great business section within our paper so that only we serve our readers.

Next question is from the line of [ Basant Baheti ] from [ Basant Baheti ] Investments.

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Ladies and gentlemen, due to time constraints, that was the last question for today. I would now like to hand the floor over to the management for their closing remarks. Thank you, and over to you.

Thank you, and thank you, everyone, for your participation and time on this earnings call today. And I hope that we responded to your queries adequately today, and we'll always be happy to be of assistance through our Investor Relations department, headed by Mr. Prasoon Pandey for all your further inquiries. Take care, everyone, and stay safe. Thank you. Have a nice day.

Thank you. Good day.

Thank you very much. Ladies and gentlemen, on behalf of D. B. Corp Limited, that concludes this conference. Thank you all for joining us, and you may now disconnect your lines.