Hindustan Media Ventures Limited ($533217)

Good afternoon, ladies and gentlemen. This is Aaditya Mulani from the HT Media Group. I would like to welcome you all to our quarter 4 and full financial year '25-'26 earnings Webinar. [Operator Instructions] Joining me on today's call are Mr. Piyush Gupta, Group CFO; Mr. Pervez Bajan, Head Financial Controller; and Controllership and Taxation and members of our team. We hope you have had an opportunity to review the financial results of Hindustan Media Ventures Limited announced yesterday as well as those of HT Media Limited released earlier this afternoon. Please note that our discussion today will follow the presentation slides which, along with the financial statements, are available on the stock exchanges and in the Investor Relations section of our respective websites. Moving on to Slide 2. This slide includes our standard disclaimer regarding forward-looking statements. As per usual practice, we do not provide specific guidance on revenue or earnings projections. On to the next slide. This slide features comments from our Chairperson on the company's performance and I quote, "The fourth quarter of '25-'26 and the full year marked a period of decisive transformation for your company, one characterized by meaningful improvement in profitability, even as consolidated revenue remained broadly stable on an annual basis. Our Print business performed well both for the quarter and the full year. Advertising led revenue growth across our English and Hindi mastheads translated into higher profitability. In the near term, though, rising newsprint costs amplified by a weakening rupee and the prevailing global environment of supply chain disruptions, trade policy uncertainty and geopolitical volatility remains a concern that we are managing with cost discipline. The Radio business faced a tough year with revenue declining on a full year basis. Business was impacted by a high base from prior year's event-led revenue and was compounded by larger industry-wide issues. As part of the ongoing streamlining of our Radio business, your company has surrendered nonviable licenses, sharpening the network footprint and improving business profitability. In Digital, our results reflect a deliberate and value-accretive reset. The discontinuation of OTTplay business is in line with our focus on profitable growth. As always, your trust powers our journey. We remain unwavering in our commitment to trusted journalism, quality content for our diverse audiences and sustainable long-term value for our shareholders." End of quote. Today's agenda will begin with the performance update focusing on the consolidated financial results for the fourth quarter and full financial year. This will be followed by an overview of our Print, Radio and Digital business segments. After which, we will open the floor for a Q&A session. With this, I now hand over to Mr. Piyush Gupta for the main presentation.

Thank you, Aaditya. Good afternoon, ladies and gentlemen, and welcome to our earnings call for FY '26 Fourth Quarter and the Full Year Results. We'll be tracking the webinar on your screens. So we look at -- if we look at the consolidated financial summary, total revenue remained stable for the full year. However, margin expanded on a Y-o-Y basis, both for the quarter and for the year. Cash position stays robust. Diving a little bit into the numbers for the fourth quarter, if you see the total revenue came in at INR 558 crores, which is down 2%. EBITDA at INR 131 crores, which is up 5%. Margins expanded by 100 basis points at 23%. PAT came at INR 96 crores and a PAT margin at 17%. On a full year basis, it was a flat revenue with EBITDA at INR 298 crores with an 8% growth. If you look at EBITDA margin, again, 100 basis point improvement, you can see, and PAT came at INR 153 crores at a margin of 8%, and our net cash position remains robust, north of INR 1,000 crores. Diving into business unit performance. First Print, as you can see, ad revenues have remained strong for the quarter and full year, led by yield improvement. Circulation revenues have held steady with an uptick in the quarter, primarily from higher copies and healthy margin expansion seen for the segment. Again, a bit into the numbers, ad revenue, 10% at INR 313 crores, circulation revenue growth of 4% at INR 51 crores, operating revenue hence at INR 437 crores and operating EBITDA coming at INR 97 crores with a 23% margin. For the full year, revenues at INR 1,148 crores, which is an 8% growth. Circulation revenue flat, operating revenue at INR 1,500 crores, which is 8% increase and operating EBITDA came at INR 208 crores with EBITDA margin of 14%. Diving into English. Ad revenue, for the quarter, ad revenues, which I told, came at INR 172 crores, which is a Y-o-Y growth of 9%. And on a full year basis at INR 644 crores with a growth of 8%. Circulation revenue, on a quarterly basis, it grew by 13% at INR 13 crores and on a full year basis at 53% with a marginal decline of 5%. Coming into Hindi, ad revenues for Hindi grew by 12% for the quarter at INR 142 crores. And for the full year at INR 504 crores with a growth of 8%. Circulation revenues virtually flat at INR 38 crores, same for the full year revenue of circulation, which is at INR 155 crores. A quick look at Radio. The segment revenue declined on account of 5 events-led revenue, which is there sitting in the base. Business continues to be under pressure with subdued margins. Diving into the numbers, the quarterly numbers, operating revenue came at INR 43 crores with operating EBITDA at a negative INR 17 (sic) [ 7 ] crores. And on a full year basis, the revenue came at INR 140 crores with operating EBITDA of negative INR 22 crores. Finally, look at the Digital, which is Shine and Mosaic. Segment revenues restated for continued operations at the -- held steady for both the quarter and the full year, a slight dip in margins. On the revenue for the quarter, it's a flat operating revenue of INR 39 crores with operating EBITDA at a negative INR 2 crores. On a full year basis, its operating revenue, again flat at INR 155 crores and operating EBITDA at negative INR 8 crores with a 5% negative margin. With that, we come to the end of the presentation.

[Operator Instructions] Also as is the ambit of this call, please be mindful to post questions pertaining to the listed entity, HT Media Limited and those within its consolidated structure. [Operator Instructions] The first question is from the line of Yash R.

The number seems decent, especially the ad revenues. So congratulations on that on the first front. Now we've grown by around 12-odd percent in HMVL and 9-odd percent in our...

Yash, can you repeat the question, the voice just got garbled up. Can you be a little slow and repeat the question, please?

Sorry, I'll be a little louder. Is it better?

Much better.

Okay, yes, sure. So ad revenues have grown in English and Hindi as well by almost, I would say, double-digit in English, 9%. So are these on the back of volumes or have you increased any pricing?

So the simple answer is, Yash, as I explained -- or actually, I didn't explain that, that was in the Board meeting. The lever for the growth in revenues is primarily yields, volume have been by and large flat, which have tracked the industry. So it's basically pricing. Now we'll have to see how much of that is structural, how much -- there's a big effort that we are doing on pricing, which has flown into the results in this quarter.

Okay. And this is across both Hindi and English or is it only for English?

Across.

Okay. And what -- there seems to be a tremendous growth in the other operating income in both. What's that on the back of? -- because I believe that, Hindi, HMVL the operating income has grown almost 100%. I mean, by my calculation, it's around 32%, and it was practically half last year in the same quarter.

Well, there are two things sitting in other operating income. One, obviously, is the profit on sale of assets that we do, which is the AFE asset. So that's a number which is flown in. Secondly, as you know, on our AFE thing, we've got these contracts with counterparties, and there is a certain contractual revenue, which has to come in a specified period of time. If that doesn't happen, that amount stands forfeited. So some part of that is on account of forfeiture and some is on account of selling of AFE assets.

Okay. And what about the circulation revenue, I mean it has been mentioned that there has been an improvement in the English part. So is that copies again or is that in the -- on the back of the prices?

Well, overall circulation revenue is plus 4% between English and Hindi. I would say realization per copy is slightly flat at about 3% here and there, but there's not a huge amount of variance in circulation revenue. Overall, [ TO ] is slightly up. We've been trying to go for a certain copy share market by market, not carte blanche, number of copies definitely have a role to play. But I don't think it's a very substantial amount. It's just we want to retain a certain level of copy share in our key markets.

The English -- in the presentation, the English circulation revenue says 13%. So I was just wondering. And I know there's a comment that says that it is on the back of increase in circulation. So I just wanted to clarify whether that's on the back of pricing or the copies have gone up because it says...

Primarily copies.

[Operator Instructions] The next question is from the line of Rohan Agarwal.

Am I audible?

Yes, Rohan, you are.

This is Rohan Agarwal from Wave asset, PMS. I just had a couple of questions. One, could you give us a little more color on your decision to discontinue the OTTplay division as in what led to that decision? And what would now be your future growth levels given that you shut off the Digital division?

Yes. I think that's a great question, Rohan. So Rohan, if you just go back the last 3 or 4 investors earnings call, we've been maintaining that there are quite a few levers that we are trying to turn in OTTplay, but there's a finality to everything, and we ourselves we've given ourselves a certain timing. If in that, we can make the unit economics and the entire P&L work, we will double down, hence, we will take appropriate decisions. So obviously, we've been trying multiple things, both from -- on the content strategy, on the acquisition strategy, on the retaining strategy of various subscribers and so on and so forth. But however, in spite of our best effort, the space became increasingly challenging, especially since all the big telcos also have a significant presence. Though I must also caveat that we had already segmented our markets not as Tier 1, but Tier 2 and Tier 3 towns, thereby, we were using a different distribution channel to propagate our product. But having done all that, we don't make the whole proposition work. Therefore, we've decided to call it quits on OTTplay. And we've been leading the investors towards this direction for the last 3 or 4 quarters. Now the second part of your question is the future growth drivers. I think that's a great question. Though it's not consolidated here, but from a group perspective, we've always been saying that if digital is the future, we obviously are prioritizing our investments behind our Digital business. So Digital business is something that we will obviously prioritize but please remember the core of our business for the time being is our core Print business as your predecessor asked about circulation numbers. We have been investing in copies for getting a certain copy share, and we will keep on doing that, which has -- which have been financed by a very handsome yield improvement. So we will keep on investing behind the core but a lot of investment will also go behind the businesses of tomorrow primary Digital businesses. I hope I have answered your question, Rohan.

Sure, Piyush. I also had another question. So I'm just trying to figure out another growth driver for the company. In the previous question, you were talking about the sale of AFE assets. So I just wanted to know what's the company's policy when it comes to monetizing the AFE assets, does the company actively look for secondary transactions to monetize them or on exit events? So if you could give us some more detail on that, that would be great.

Yes. The simple answer is yes. We are not holding these assets for the very long term. Of course, it doesn't mean that we will flip the assets within months. But at the earliest opportunity, when we think we can maximize the value for the organization, we will sell these assets. If you look at our track record over the last 4, 5 years, I think we've managed to do this activity pretty successfully and with the AFE portfolio that we have right now, which has all maturities of assets, fully matured assets, semi-matured assets and of course, assets which are under baked at this point in time. We keep on looking at a portfolio strategy to maximize the cash [indiscernible]. And the company's policy is very clear. We have to maximize value but we are not desperate sellers. We've got a reasonable portfolio and we'll be active sellers in the market. As much effort we make in striking new deals and getting new asset acquisition, that's the same effort which goes behind divestiture of these assets as well.

Got it. And just to clarify, whenever you buy any AFE assets, it's always noncash transaction, right? You're never paying for acquiring any of the AFE assets other than with ad space, right?

You're right, Rohan.

The next question is again from the line of Yash R.

Now I was seeing the HMVL results, and there seems to be some number changes in the previous year segment revenue by around INR 6-odd crores. Therefore -- so I'll just elucidate. Last year, we had reported a number of around INR 673 crores for the segment revenue of Print publishing newspapers and periodicals. But when I'm looking at the results, now it says INR 667.23 crores and I believe the PBIT or the results profitability has gone down an equal amount.

Can I request my colleague, Pervez to answer that question? Pervez, would you like to?

Yash, this is because of intersegment revenue where OTTplay had advertised in the print newspaper, because OTTplay went into disc ops, this was the correct thing to do as per accounting standards.

So we've written that off?

Yes.

The next question is from the line of Ranga Prasad.

At the outset, I would like to say that I'm quite relieved that the company has finally decided to scale down or shutdown its unviable businesses in the form of surrendering Radio licenses and getting out of the OTTplay business. During the past few years, our company has incurred huge losses due to these unviable businesses. I find that just in this last 1 year, our company has shown an exceptional loss from continuing operations of INR 114 crores and a loss from discontinued operations of INR 101 crores, totaling INR 215 crores loss. I'm glad that management has finally taken steps to stem these losses, better late than never. Now going forward in the coming few quarters, what can we expect? Can we expect any further exceptional losses due to the surrendering of Radio licenses or revamping our Radio business? And two, can we expect any further losses on account of shutting down the OTTplay business?

Okay. Great question. Ranga, you got something further?

Yes, just a clarification. I would like you to clarify or throw some light on two issues. One is, why has other income dropped from -- by about INR 50 crores from INR 218 crores in FY 2025 to INR 197 crores in 2026, the other income? And second thing is what's the rationale for HMVL making an investment of INR 22 crores in a seemingly unrelated business, a business, which has shown close to nil revenues, though has been in business for over 8 years. I'm referring to the investment in Asset Vault Limited.

Okay. Okay. So three questions that I have taken, Ranga. First of all, thank you very much for those kind words. Yes, of course, those exceptional losses and discontinued operations are big numbers, and we totally take your point on board. I have basically taken down three questions, and correct me if I'm wrong. One you're asking about the go-forward strategy. Second, you've asked for a clarification on other income. And third is on this Asset Vault, which is the investment that you've asked. Am I right?

Yes, that's correct. Primarily concerned that are we going to take some additional losses on account of the closed businesses in future, we should know about it.

Okay. Okay. Okay. Okay. So last question, let me answer first. Are we going to take any further closure losses or discontinued operations or exceptional losses? The simple answer is no. But even if you break down the exceptional items in this year, one of the big items which is sitting is consequent to the new labor codes, which were announced by the Government of India. That, of course, if anything of statutory nature does come that obviously will impact the financials. But from the business side, I can absolutely tell you that we have kind of looked at the entire portfolio of businesses, and we've cleaned up as much as possible. Just to give you a sense, OTTplay, I think I've already explained, so you've heard me. On the Radio, we did an entire portfolio review where all the 5 loss-making frequencies now and 1 loss-making frequency earlier totaling to 6 loss-making frequencies, those are the frequencies that we surrendered back to the government of India. All existing frequencies are profitable frequencies. And obviously, our intent is to increase the profitability as we go forward. Now however, as I explained in the webinar, radio as a sector is under a lot of pressure, but we will keep on reviewing this on a very close basis. But right now, all the frequencies or all the stations which are not turning in a profit, we've already surrendered those frequencies. Going forward, if I just have to marry the thought, our investments will go a lot into the core business, which you've seen have gone into the circulation and copies in this quarter and some part of the investments will go in our digital business, not the digital segment of HT Media consolidated, but the Digicontent Limited also where we are prioritizing some investments. So that's the part on going forward and would we kind of have any more exceptional loss. Now coming to other income, we basically had the interest income, which is interest income about a substantial treasury, which is sitting there. The interest income has obviously, if you track the yield curves, yield curves are at a record higher, 10 years close to about 7% and so on and so forth. So there are quite a few mark-to-market losses that have impacted us as on 31st of March. We are very hopeful. We are not -- we are -- this is patient capital, right? We don't have to withdraw this capital like tomorrow. So we will tide out the curve. We are very hopeful that the yield curves will stabilize and these will come back. That is what is impacting other income to the extent of INR 50 crores in the full year. Of course, there are various other small reasons, but that's a chunk of the reason which is happening there. On the Asset Vault, you are right, Asset Vault, the revenue is a pretty small revenue at this point in time. But as explained earlier, it's again an AFE investment. It's not a cash investment, it is AFE investment, and there are certain marketing plans that the company has for the market of India, where we would like to give our marketing properties and partner with them in the hope that the asset will become profitable. So there's no cash invested. That's Asset Vault where the brand name is AasaanWill. I hope I've answered your question.

Yes. I'm quite relieved with the decisions being taken. And I'm hoping to see company return to good profitability in the coming 2 quarters.

The next question is from line of Raman KV.

Hello. Can you hear me?

Yes, Raman, please go ahead. We can hear you.

I'm Raman from Sequent Investment. So I have a question. Sorry, I joined the call a little late. Can you just provide me the current yields with respect to the circulation like how quarter-on-quarter and year-on-year improvement in the yields figure?

Well, we can't because of some -- this is a competitive information, but I can tell you, you are talking about circulation yields, right? You're not talking about -- and well, circulation yields, I would basically just broadly say have been flat year-on-year. The copies have increased because we are going after copy share. But I can't give you that specific number. I have a blended number, but that number has should be seen market by market. I can broadly tell you that we are in the ballpark of the -- competitive forces are different in different markets, and we try to benchmark our realization for copies on a market-to-market perspective.

So if my understanding is right, your realization of copies has increased during the quarter, you mean to say.

It has, it has but marginally because the constraint there will be competition but you are right. Our realization per copy has increased.

And sir, if you can give a ballpark figure of -- with respect to gaining market share in the copy segment, have you gained the market share during the quarter?

Well, in a few markets, we've taken additional -- we call it copy share because this is on copies. Yes, on a few markets, we have increased our copy share, which is a part of our conscious strategy and we plan to keep it like that. But you have to understand that when you go after copy share, there are certain short-term trade-offs that you have to do for long-term gain, so which we are doing on a market-to-market basis. But broadly, our copy share has gone up marginally, yes.

So the growth in EBITDA with respect to the Printing division, is it because the advertisement realization has increased? Or is it because on the back of circulation yield improvement?

No, the first one. Ad yield, which is -- because you joined the call slightly late, I was explaining to one of the earlier participants, ad rates or ad yields what we call them, have increased substantially and of course, it's a full algorithm. You put in a certain copy, you recruit new reader, you give a certain value proposition to advertisers and you try to have certain level of AFE deals where the new guys can come on board who -- either who would not be advertisers and so on and so forth. And then you demand a certain pricing on your advertisement and that has played out very beautifully in this quarter, so it's Ad rates.

And is this current ad yields maintainable, like sustainable for the coming year as well?

Well, to an extent, yes, but I won't do a carte blanche on that because maintaining 100% gains, et cetera, has never -- because there's an immediate reaction, which always comes from the competition. But our hope and prayer, and even for the plan that we have set out for ourselves, though, we don't give a forward guidance, we plan to keep our yields at a certain level and above, and not below.

Okay, sir. And sir, my last question is with respect to your discontinued business. How much are you planning to expect from your -- once you completely discontinue your OTTplay business? Is your -- are you expecting any inflow of cash into the company?

What do you mean by that? I mean the...

Are you planning to sell off the existing OTTplay play brand on distribution, which you have built to someone else? I just want to understand how are you planning to discontinue and will it -- there be any...

Yes, Raman, we've had those strategic conversations with a lot of potential partners and suitors. Unfortunately, nothing has worked out. So at this point in time, we've decided to shut down the business. And this was not a capital-heavy business. So there is no residual value, so we have tried all those things, but right now, it's not making sense.

The next question is again from the line of Rohan Agarwal.

Continuation of the OTTplay business. Can you confirm if there will be no further onetime losses attributing to that business that will show up in the coming quarters?

Yes. Rohan, what I can confirm is -- so okay, let me give you 2 or 3 data points. Effective 31st of March, which was the last date till we were -- till which we were setting OTTplay subscription; for first of April, we are not selling any OTTplay subscription. However, subscriptions, which have been sold on or prior to 31st March will have to be serviced for the life, which can typically be ranging from 1 month to 6 months, any point in time. if the unit economics of that is not working out, there might be marginal losses, et cetera, which will basically come into the P&L for FY '27, but that will be a very small number. Also, parallelly, you should expect that because we are winding down the business, all the negotiated contracts that we had on the content side, on the ISP side, on the channel partner side, are being exited by a certain negotiation and a certain contractual nature. So those will basically tantamount to cash flow. So there will be some cash impact to shut down these contracts. But from a P&L perspective, there will be a very marginal impact of some residual subscribers, which -- who purchased their subscriptions in March and might go up until September, but that will be a very small number rounding off.

So basically, it's expenses related to servicing those residual subscription time lines, that's it.

Yes. You're absolutely right, Rohan.

Got it. And just my last question. Does the Board of the company have any policy regarding the substantial cash pile that we have now, if you can give us any information on that?

Well, Rohan, the Board always discusses the cash pile, and you know what to do, as I can tell you, and we had a Board meeting. You know the company would like to create long-term sustainable value for shareholders by investing in businesses of tomorrow. So right now, we're investing behind core and our digital businesses. Of course, we tried OTTplay, after a certain time when we realized that it's not going to work out, we've also decided to exit that space, but that cash at this point in time, the Board has thought it fit to kind of invest behind businesses of tomorrow and create a long-term value.

No plans to return anything to the shareholders currently?

Well, there is none so far.

Thank you all. With this, we come to the end of the Q&A session. If you have any further queries, please reach out to the Investor Relations team. Our contact details are given in the investor presentation and are also mentioned on our website. I now hand over to Piyush for closing remarks.

Thank you, Aaditya, and thank you, ladies and gentlemen, for participating in our earnings call. I'm very pleased with the kind words some of you shared with us. Our hope and expectation is that we'll be able to churn out such good set of numbers quarter after quarter for you and some of the low investments that we will plan will create long-term sustainable value for all shareholders. I wish you all the very best, and I look forward to seeing you in the next quarterly earnings call. Thank you very much, and have a great day.