B A G Films & Media Ltd Management Discussions

Under Schedule V to the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("the SEBI Listing Regulations"), we present a comprehensive Management Discussion and Analysis Report focusing on business performance and outlook within the competitive landscape set by the Company.

A. INDUSTRY STRUCTURE AND DEVELOPMENT

The Indian Media and Entertainment (M&E) industry is one of the important sector for the Indian economy and is making significant strides. Proving its resilience to the world, Indian M&E industry is grew by 8% in 2023, reaching INR 2.3 trillion, 21% above its pre-pandemic levels in 2019 level. While television remained the largest segment, we expect digital media to overtake it in 2024. We expect the M&E sector to grow 10.2% to reach INR 2.55 trillion by 2024, then grow at a CAGR of 10% to reach INR 3.08 trillion by 2026.

The share of traditional media (television, print, filmed entertainment, live events, OOH, music, radio) stood at 57% of M&E sector revenues in 2023, down from 76% in 2019 level.

Indias media and entertainment industry tends to outpace the nations GDP growth. Last year, the industry grew over 8%, despite global headwinds. While traditional media, such as television and radio, continue to dominate the market reaching 800 and 400 million consumers respectively, digital has truly caught up, recording a reach of 600 million. While print, with a reach of 300 million, and cinema with 100 million, may appear smaller, they continue to remain essential in shaping the future of the industry.

New media, comprising digital and online gaming, emerged as the frontrunner in growth, contributing INR 122 billion of the overall increase of INR 173 billion, and consequently, increased its contribution to the M&E sector from 20% in 2019 to 38% in 2023.

Experiential (outside the home and interactive) segments continued their strong growth in 2023, even as online gaming, filmed entertainment, live events, and OOH media segments grew at a combined 18%, contributing 48% of the total growth.

A new era of 5G technology will unlock the potential of entertainment for Communications Service Providers (CSPs) enabling them to capitalize on mobile media growth and provide content over the internet without the involvement of an IPTV, cable, or satellite provider. Technical limitations, including slow and unreliable networks, have historically made it difficult to deliver digital media, entertainment, and advertising content.

5G will help companies serve higher-quality, interactive, and immersive experiences across a wider variety of connected devices. It will also enable marketers to collect more accurate and granular data to personalize messaging.

The sector is witnessing a massive transformation, fueled by the Government of Indias thrust on improving digital infrastructure in the country. In 2024, digital media is poised for explosive growth, potentially overtaking television to become the leading segment of the M&E sector. This surge in digital media is forecasted to propel the M&E sectors growth to a 10% annual rate, crossing INR 3 trillion by 2026. This growth is buoyed by a robust digital infrastructure, widespread adoption of OTT platforms, significant growth in the gaming segment, and the availability of cost-effective options for consumers.

MEDIA GROWTH ESTIMATES*

Segment	2022	2023	2024E	2026E	CAGR 2023-26
Television	709	696	718	766	3.2 %
Digital Media	571	654	751	955	13.5 %
Print	250	260	271	288	3.4 %
Online gaming	181	220	269	388	20.7 %
Filmed Entertainment	172	197	207	238	6.5 %
Animation and VFX	107	114	132	185	17.5 %
Live events	73	88	107	143	17.6 %
Out of Home Media	37	42	47	54	9.3 %
Music	22	24	28	37	14.7 %
Radio	21	23	24	27	6.6 %
Total	2,144	2,317	2,553	3,081	10.0 %

All figures are gross of taxes (INR in billion) for calendar years : EY estimates

INDUSTRY SIZE AND PROJECTION

Everyone wants to stay entertained, especially in a world filled with uncertainty and entertainment and media (E&M) companies are facing uncertainties of their own. After robust 10.6% growth in 2021 and a notable surge in industry growth after the pandemic receded, the pace of growth in the entertainment and media industry is projected to decline in each of the next four years - 2024 - 2027. The analysts expect the annual industry growth rate to level out at 2.8% by 2027, underscoring a recalibration in the media and entertainment industry.

Amidst this recalibration, digitalization continues to shape the entertainment and media terrain. Equip with valuable insights into media and entertainment industry trends that will affect the industry.

Consumer spending on media and entertainment is projected to grow at a humble 2.4% compound annual growth rate (CAGR) between 2024 and 2027, resulting in a market size of US$903.2 billion. As e-commerce and digital platform engagement rise, companies worldwide will intensify spending to connect with consumers during decision-making moments.

We can also expect to witness a surge in digital content providers, intensifying competition in the already content-rich landscape. As a result, despite an increase in the time spent accessing entertainment and media content, consumer spending per capita in the digital entertainment and media industries is expected to decrease, dropping from 0.53% of average personal income in 2023 to 0.45% by 2027.

Television

Television advertising fell 6.5% due to a slowdown in spending by gaming and D2C brands, which impacted revenues for premium properties. The HSM market was also soft, resulting in a 3% overall ad volume de-growth. Subscription revenue grew after three years of fall on the back of price increases, though pay TV homes fell by two million. While linear viewership grew 2% over 2022, 19 to 20 million smart TVs connected to the internet each week, up from around 10 million in 2022.

Total TV screens will increase from 182 million in 2023 to 202 million by 2026, with the mix changing significantly in favor of connected TVs today. The situation post 2026 could be quite different, once wired broadband crosses 60 million to 70 million homes and 5G connections scale significantly. At this point, we expect connected TVs to start scaling more quickly, and reach 100 million by 2030, while linear TV homes drop to 140 million, of which 57 million would be free TV homes.

Number of television channels increased to 899, of which 61% were free-to-air. Time spent on TV increased 2% over 2022, but TV continued to lose premium properties in 2023 as NCCS ABC audiences fell 1%.

The television segment has witnessed some interesting, yet dichotomous developments in recent times. Although the number of pay TV subscribers continue to decline, the overall number of TV viewers continues to grow. While advertising shrunk, the number of TV screens are growing and the overall segment is expected to have a positive outlook in the coming times. Viewership of connected TVs would continue to grow and proliferate with the increase in broadband and 5G. Overall, while the coming times would provide many growth opportunities, the segment would also face competition from other avenues, such as social media, gaming and short videos.

Television segment shrunk 1.8% in 2023

Segment	2022	2023	2024E	2026E
Advertising	318	297	308	330
Distribution	392	399	410	435
Total	710	696	718	765

INR billion (gross of taxes) : EY analysis

• TV advertising revenue fell 6.5% in 2023. Advertising volumes declined 2.6% in 2023 as the number of brands using TV in 2023 fell by over 5% as compared to 2022; the fall was led by national channels which witnessed a 9% drop while regional channels ad volumes remained stable

• Ad rates fell 4% on an average as the advertiser mix shifted to lower yield categories. Distribution income reversed its falling trend in 2023 to grow 2%, despite pay TV homes reducing by 2 million to 118 million (including pirated and under-declared homes).

• Pay TV ARPUs increased by approximately 4% to reach INR 274 per month (gross of taxes). An increase in piracy and under declaration was noticed as channel price increases could not be entirely passed on to consumers. Connected TV sets reached 35 million, of which around 19 million connected to the internet weekly.

Number of television channels increased to 899 channels.

Channel Category	September 2021	September 2022	December 2023
FTA	558	532	546
Pay	348	353	353
Total Channels	906	885	899

MIB website; TRAI

HD televisions dominate the market, but UHD TVs are anticipated to register the highest growth. This trend is attributed to the growing preference for high-resolution content and immersive viewing experiences. The demand for large-display televisions is also on the rise, contributing significantly to market expansion. The lockdowns during the COVID-19 pandemic boosted the demand for home entertainment, which accelerated the adoption of smart TVs, even in rural areas. This shift indicates a broader trend towards digital and on-demand content consumption. There is a notable shift towards digital consumption and direct-to-consumer (D2C) streaming services. Platforms like Netflix, Amazon Prime, and local OTT players are expanding their content libraries, focusing on local productions and lower-priced tiers with ads to attract a broader audience.

One of the key challenges is the rapid pace of technological advancements, which requires continuous innovation from manufacturers to stay competitive. This includes the development of 8K resolution TVs and enhanced smart TV functionalities. The rising middle-class population, increased disposable income, and urbanization are driving the growth of the television market in India.

Factors impact growth of time spent on television include:

• Rising popularity of YouTube, which has around 467 million monthly users as of end of 2023 and provides a relatively free multi-lingual and individually curated Indian and global content palette, including certain premium content from broadcasters and studios.

• Growth of social media, short video and gaming, which all compete for the consumers free time, and have achieved a reach in excess of 400 million.

• Availability of high quality and niche content on OTT streaming platforms, which caters to niche and more affluent audiences.

• Growth of wired and wireless broadband to around 38 million households, and sale of smart TVs, which are growing consumption on that distribution channel BARC.

The future of the Indian television market looks promising with continuous technological advancements and increasing consumer demand for high-quality content and smart TV features. The market is expected to see further growth in UHD and smart TV segments, driven by innovations and expanding internet penetration across the country.

Digital Media

India recorded 1.19 billion telecom subscriptions, which indicates a stable digital infrastructure landscape. Although 5G proliferated, with 130 million subscriptions, 4G continues to dominate the market. Connected TV saw a 50% growth as internet penetration continues to rise. The broadband market is growing with subscriptions numbers recording 904 million. It is inevitable that smartphone users have grown and consequently, the average usage time continues to rise. Despite high app downloads of 26.4 billion, India was behind in monetizing this potential, with users spending half their time on social media apps. Video viewership progressed, while content platforms focused on localizing, particularly in popular genres of drama, action and thrillers. Enhanced digital engagement led to different patterns in content consumption and advertising. The year also saw the growth of digital ad spending by 15%, predominantly in search and social media. By 2026, the digital segment is expected to grow to INR 955 billion with an increased focus on governance.

Digital Media grew 15% in 2023

Service	2022	2023	2024E	2026E
Advertising	499	576	662	842
Subscription	72	78	89	114
Total	571	654	751	955

INR billion (gross of taxes) : EY analysis

• Telecom subscriptions remained stable at 1.19 billion in 2023. 5G adoption crossed 100 million subscriptions, though 4G subscriptions still dominated.

• Internet penetration increased by 8% to 938 million subscriptions in December 2023. Broadband subscriptions in India crossed 900 million, of which 96% were mobile connections, and only 38 million Indian households had a wired broadband connection.

• Smartphone users increased to 574 million in 2023 from 538 million in 2022, a penetration of around 40% of Indias population. At 4.8 hours per day, Indians spent 9% more time on their phones in 2023 than in 2020.

• Indians spent the aggregate time on their phones in the world, downloaded the second highest number of apps, yet in terms of revenue, India lagged many smaller markets and did not feature in the top 20 revenue generating markets of 2023.

• 50% of the time spent on phones in India was on social media and another 28% on entertainment and news. Video viewers increased by 7% (36 million) in 2023 to reach 563 million.

• Almost 3,000 hours of fresh, original content was produced for streaming platforms, of which 52% was in regional languages, up from 47% in 2021. There were 456 million digital news consumers in India, of which over 80% consumed news on their mobile phones.

• Monetization remained a challenge, with news generating just INR 19 billion in ad revenue and around INR 2 billion in subscriptions. Social media penetration was 32% of Indias population, reaching 482 million people.

• Indians spent two hours a day on social platforms, and used it to meet their needs across news, social, entertainment, music and gaming.

ChatGPT, Bard, etc., will affect news publishers revenues if they scale significantly to build first party data, we expect a higher focus on registrations, contests, and interactivity. Subscription revenues will grow at 11% CAGR to reach INR 97 billion in 2025.

Advertisement

The Indian entertainment industry, one of the largest and most dynamic sectors globally, is significantly influenced by advertising. In 2024, advertising continues to play a pivotal role in shaping the industrys landscape, driven by technological advancements, evolving consumer preferences, and the proliferation of digital platforms.

Digital surpassed traditional advertising for the first time this year, and will drive growth in the sector moving forward. Several factors, including the growth of 5G, rising per capita income of Indians and the growing SME advertiser base, are driving digital ad spends. That said, traditional print, radio and cinema advertising trends also indicate healthy growth in the coming times. The advertising expenditure in India is projected to grow substantially in 2024, driven by the resurgence of economic activities post-pandemic. The Indian ad market is expected to see a double-digit growth rate, reflecting strong consumer demand and business confidence.

Digital advertising is set to overtake traditional media, accounting for a significant share of the total ad spend. With the increasing internet penetration and smartphone usage, brands are leveraging digital platforms to target specific audiences effectively. Despite the rise of digital, television remains a dominant medium for advertisers due to its extensive reach and impact. Innovations such as addressable TV and interactive ads are enhancing viewer engagement and providing better ROI for advertisers.

Platforms like Facebook, Instagram, and Twitter are witnessing a surge in ad revenues. Influencer marketing continues to be a powerful tool, with brands collaborating with popular influencers to reach younger demographics.

OTT (Over-The-Top) Services: The growth of OTT platforms like Netflix, Amazon Prime, and local players such as Hotstar and Zee5 has opened new avenues for advertising. These platforms offer targeted advertising opportunities through data-driven insights.

Television advertising reduced the growth by 28% as sports advertising on TV fell compared with 2022, and HSM markets saw lower yield categories increase their share of ad volumes and a ban on certain categories like crypto, gaming amidst betting, and D2C brands

• Indian advertising grew 7% in 2023.

• New media accounted for 52% of total advertising, overtaking traditional media advertising (48%) for the first time.

• We estimate advertising to grow a further 10% in 2024.

• New media generated 105% of total ad growth, while traditional media (excluding television) added another 23%.

In 2024, the Indian entertainment industrys advertising landscape is marked by rapid growth, digital transformation, and evolving consumer behavior. While digital platforms are leading the charge, traditional media continues to hold significant value. The key to success for advertisers lies in leveraging technology, embracing innovative ad formats, and maintaining a consumer-centric approach to create impactful and engaging advertising campaigns.

Distribution

Television subscription revenues in India increased 2% in 2023, despite a fall of 2 million pay TV homes, due to an approximately 4% increase in TV subscription ARPUs, which reached INR 274 (gross of taxes) at end-customer prices during the year. While broadcasters increased channel prices uniformly, ARPU increased differently across markets, in some cases resulting in an increase in under-declared households/pirated households, as LCOs could not pass on price increases to end consumers.

The fall in pay television homes has been attributed to cord-cutting and movement to connected TVs at the top end of the market, growth of alternate entertainment options and digital platforms, as well as availability of a sizeable content bouquet for Hindi speaking markets on free television (DD FreeDish), which remained stable in 2023 and provided a competitive offering to the base pack on pay TV.

Broadcasters whom we interviewed claimed to have earned revenues for between 105 to 110 million paid subscriptions in 2023, as compared to 110 to 130 million reported in 2021, indicating a potential base of pirated connections between 10 and 15 million homes.

Active paid subscriptions continued to reduce in 2023

	2020	2021	2022	2023
Cable	72	68	64	62
DTH	56	55	54	53
HITS	2	3	2	2
Total Pay TV	130	125	120	118
Free TV	40	43	45	45
Total	171	168	165	163

Television subscriptions (in million) : Industry discussions, billing reports, TRAI data, EY analysis

Radio

The radio segment is still recovering from the pandemic- induced slowdown. Although, revenue continues to grow, it is yet to meet the 2019 numbers. Hyper localization has become an important factor towards the growth of radio. While smartphones continue to grow and impact almost all segments of the M&E sector, radio is no longer available on all smartphone models. There are distinct opportunities for radio in India to grow, provided the right opportunities are tapped.

Radio companies are focusing on integrated solutions, including content production, event IPs, social media, commissioned podcasts, audio stories, influencer marketing, etc., to their retail advertisers as a one- stop shop. There is a need to address issues relating to listenership measurement, implementation of digital radio, and mandating the inclusion of FM receivers in smartphones, for the sector to achieve its true potential. Unless the above issues are addressed, we expect revenues to recover to INR 26 billion by 2025, of which around a fifth will be non-FCT revenues.

India had 1,313 operational radio stations, an increase of 90 stations over the previous year, including 446 community radio stations.

Radio segment revenues grew 10% in 2023 to INR 23 billion, but were still just 73% of 2019 revenues. Ad volumes increased by 19% in 2023 as compared to the previous year, with estimated fall in ad rates by 8%. Share of retail advertising increased.

Radio companies are focusing on building regional shows, with novel and engaging content, which are multi-media in nature, and non-FCT revenues are now 20% to 25% of total revenues. Lack of unified and independent third party monitoring continues to be an industry issue.

The Government approved 43% increase in the base rates of advertisements on private FM radio stations. The new rates have been announced after eight years

The Telecom Regulatory Authority of India (TRAI) has released recommendations on issues related to FM radio broadcasting, including private FM Radio operators being allowed to broadcast news and current affairs programs, limited to 10 minutes in each clock hour.

TRAI has also recommended removal of linkage to non- refundable one-time entry fee and extension of the existing FM license period of 15 years by three years.

Broadcasting

The Indian broadcasting sector has witnessed substantial transformation and growth during 2023-2024, driven by technological advancements, changing viewer preferences, and regulatory developments. This period has been marked by a significant increase in digital content consumption, the emergence of new business models, and intensified competition among broadcasters.

The Indian broadcasting sector, comprising television and radio, has continued to expand. According to industry reports, the television segment alone is projected to grow at a CAGR of 8.1% from 2023 to 2029. This growth is primarily fueled by the increasing penetration of smart TVs, the rising popularity of OTT (Over-The-Top) platforms, and higher investments in content creation.

There has been a significant shift towards digital platforms, with OTT services gaining substantial traction. The proliferation of high-speed internet and affordable data plans has accelerated the adoption of digital streaming services, leading to a surge in online viewership.

Regional content continues to be a major growth driver. The demand for content in regional languages has increased, leading broadcasters to invest heavily in producing localized content to cater to diverse linguistic audiences. Despite the rise of digital platforms, linear TV remains dominant, especially in rural areas where internet penetration is lower. However, urban viewers are increasingly shifting towards digital platforms for their content consumption, creating a dual growth trajectory for both linear and digital TV.

The adoption of high-definition (HD) and ultra-high- definition (UHD) TVs is on the rise, driven by consumer demand for better viewing experiences. Smart TVs with internet connectivity are becoming more prevalent, allowing viewers to access both linear TV and digital content seamlessly.

Television advertising remains a significant revenue stream for broadcasters. Innovations such as addressable TV advertising, which allows targeted ads based on viewer data, are enhancing the effectiveness of TV ads and providing better ROI for advertisers.

The Indian broadcasting sector in 2023-2024 is characterized by dynamic growth, digital transformation, and evolving consumer preferences. While traditional television and radio continue to hold significant value, the rapid rise of digital platforms and OTT services is reshaping the industry landscape. Broadcasters need to innovate continuously, adapt to regulatory changes, and leverage new technologies to stay competitive and capture the diverse Indian audience.

Out of Home

Out of Home (OOH) media is on a growth trajectory as transit and digital media continue to grow along with traditional media. Although traditional media constitutes a bulk of the segment, transit and digital media are growing and would soon outnumber premium traditional media in the coming years. Macro-economic factors such as urbanization and growth of affluence are also contributing to the growth of the segment.

OOH media grew 13% in 2023 to INR 41.6 billion, the value of which includes traditional, transit and digital media, but excludes untracked unorganized OOH media such as wall paintings, billboards, ambient media, storefronts, proxy advertising, etc.

Digital OOH media (included in the above) contributed 9% of the segments revenues, up from 8% in 2022. The number of active digital screens is estimated in the range of 140,000 to 150,000, with an anticipation that around 75% of them are currently active.

The OOH segment exceeded its pre-COVID-19 revenues by 6%. Real estate, organized retail and consumer services were the largest advertisers on OOH. We expect the OOH segment to exceed INR 45 billion in 2024 and reach revenues of INR 54.3 billion by 2026.

DOOH is rapidly growing in India due to enhanced measurement capabilities, government support for digital infrastructure, and creative flexibility. The integration of mobile technology and changing consumer behavior further accelerated the adoption of DOOH in the Indian advertising landscape. DOOH comprised 9% of the OOH segments revenues, up from 8% in 2022.

The number of active screens increased to between 100,000 and 110,000, approximately 75% of the total installed screen base of approximately 150,0002 Digital OOH revenues

Podcast

The podcasting landscape in India has seen remarkable growth and transformation during 2023-2024, driven by increased internet penetration, smartphone adoption, and changing content consumption patterns. This period has been marked by the rise of diverse content genres, new monetization strategies, and the entry of major global players into the Indian market.

The podcasting market in India is experiencing rapid growth. According to PwCs Global Entertainment & Media Outlook, the Indian podcasting industry is projected to grow at a CAGR of 34.5% from 2020 to 2025, making it one of the fastest-growing segments in the media and entertainment sector .

The primary audience for podcasts in India consists of young urban professionals and students, with a significant portion of listeners falling in the age group of 18-35 years. The increasing demand for on-the-go, personalized content is driving this trend. With over 40 million monthly active podcast listeners, India is becoming a significant market for audio content. The convenience of consuming content while commuting, working, or multitasking has contributed to the popularity of podcasts.

Educational and self-improvement podcasts focusing on topics such as personal finance, mental health, and professional development are increasingly popular. Podcasts like "The Habit Coach" and "The Ranveer Show" are notable examples. There is a growing demand for podcasts in regional languages, reflecting the diverse linguistic landscape of India. Platforms are investing in creating content in languages such as Hindi, Tamil, Telugu, Marathi, and Bengali.

A growing number of independent podcasters and content creators are entering the market, producing content across various genres such as news, storytelling, comedy, health, business, and technology. Celebrities and influencers are also leveraging podcasts to engage with their audiences.

BAG NETWORK MARCHES AHEAD

Over the past three decades, B.A.G. Films and Media Limited ("BAG/the Company") has grown from a small media startup to one of the most influential media and production houses in India. Our journey, marked by innovation, resilience, and a commitment to quality, reflects the dynamic evolution of the Indian entertainment industry. This chronicles our milestones, achievements, and the impact weve made on the media landscape in India.

BAG holds the unique distinction of producing programmes of all genres for a range of channels and audience. Realizing the potential in digital market, we have intensive plans to produce for digital platform.

BAG with a rich industry presence of over 30 years, the Company remains committed to its purpose of quality and consistent performing, focusing on creating engaging content for different age groups, formats, media and news and non-news platforms.

The Companys extensive expertise and experience is testified in its numerous successful TV shows and milestones, well-received by viewers across the country.

BAG plans to create and deliver popular, high-quality programming for catering to not only domestic but also to the demands of international viewership and expects to earn high returns for its stakeholders. We have a strong presence in Hindi General Entertainment Channels (GECs) and Regional GECs across India. We have demonstrated an exceptional ability to consistently create high quality content to excite the Indian audience. We ensure proper and strategized distribution of our content in collaboration with our channel partners.

BAG create content across mediums i.e. TV, Movies as well as across genres to cater to the entertainment needs of our viewers across age groups.

We realized that to scale up in a meaningful way, we would need to make, own and broadcast our own content and be present across the entire value chain of the media and entertainment industry.

During the year under review, the Company has produced successful programmes like Amne Samne, Sabse Bada Sawal, News Shatak, Mahaul Kya hai, Rastra Ki Baat, 10 ki 10 Breaking, kalchakra, Bollywood Reporter, U, Me aur

TV, Insta Stalker, Bollywood Top 10, Aradhana, Jhakaas Mornings, Bhangra Junction, Hots Hits, Party on my mind, Karaare Hits, Dil Dhakne Do across different channels and strengthened its presence.

With the change of time, the world-view of people also changes. By aligning ourselves to the aspirations of evolving audiences, we strive to deliver content that grips and entices them. Our legacy is of our stories, expressed to viewers in the most appealing of ways. We continue to deliver the same as we understand what ticks, placing our creative zeal in all that we do.

OUR SUBSIDIARIES

News24 Broadcast India Limited

News24, a 24 hours National Hindi news channel operating through one of its subsidiary, i.e. News24 Broadcast India Limited has been very well received by the audiences. It is available throughout India on cable and DTH platforms.

On the television front, programs like Amne Samne, Sabse Bada Sawal, News Shatak, Mahaul Kya hai, Rastra Ki Baat, 10 ki 10 Breaking, kalchakra, amongst others cover a gamut of genres in news reporting and have been received exceptionally well with the audiences across the nation. "Sabse Bada Sawal, "Mahaul Kya Hai" and "Aamne Saamne" are achieve remarkable TRPs and viewership on News24.

These shows continue to reflect the innovative ways of reporting news that has given the maximum viewership and rating to our channel making its marked presence felt in the whole Media Industry.

E24 Glamour Limited

E24 a 24 hours Entertainment channel operating under the subsidiary E24 Glamour Limited produced successful programmes like Bollywood Reporter, U, Me or TV, Insta Stalker, Bollywood Top 10, Jakass Mornings, Bhangda Junction, Hots Hits, Party on my mind, Karaare Hits, Dil Dhakne Do etc. Apart from the above programmes, E24 procured rights to movies and started telecasting movies. The channel has been researching and experimenting different ideas and revenue models.

The rise of social media has enabled artists to engage directly with their fans, leading to new marketing opportunities and revenue streams. Artists are now able to build their personal brands and connect with their audience in new ways.

E24 is targeting new audiences and adding a subscriber base to enhance the business model. This includes the use of subscription-based services and new marketing strategies. Rapid growth of digital platforms has hit the growth of music-based channels, forcing most of the players in this segment tore strategies their content and sales pitch.

Skyline Radio Network Limited

Your FM radio station, on frequency 106.4 in the name of "Dhamaal24 - Har Khushi hai Jahan" is now the voice of the regions and its many shows are household names in all ten cities where it is operational i.e. Hissar, Karnal, Patiala, Ranchi, Muzaffarpur, Dhule, Jalgaon, Ahemednagar, Simla and Jabalpur

Dhamaal24 believes that life must be lived to the fullest and celebrated. Dhamaal24 is a channel with a slice of life and approach to the infotainment & entertainment programming. Various programs are purposely aligned for maximum listenership. Our content entices regional listeners.

Differences in music royalty rates prevent FM radio companies from creating and airing their radio channels on internet streaming platforms — an issue which the industry needs to resolve to mutually benefit broadcasters and music licensors — as curated content with RJ interactions are largely missing online, and migrant population cannot enjoy radio stations in the language of their choice

B. OPPORTUNITIES AND THREATS

The Indian media and entertainment (M&E) industry is one of the fastest-growing sectors, driven by a combination of factors such as digital transformation, increasing internet penetration, and a diverse and dynamic consumer base. However, the industry also faces several challenges that could impact its growth trajectory. This note provides a detailed analysis of the opportunities and threats in the Indian M&E industry.

Opportunities for Indian Media Industry

• The rise of over-the-top (OTT) platforms like Netflix, Amazon Prime Video, Disney+ Hotstar, and regional players such as Zee5 and Voot presents a significant opportunity. The increasing preference for on- demand content and the flexibility to consume content anytime and anywhere have driven the growth of OTT services.

• There is a growing demand for original content tailored to Indian audiences. This has led to increased investments in high-quality web series, movies, and short films, providing opportunities for content creators and production houses.

• Indias diverse linguistic landscape offers vast opportunities for regional content production. As consumption of regional language content rises, there is a significant scope for broadcasters and OTT platforms to tap into this market.

• Customizing content to cater to regional tastes and preferences can enhance viewer engagement and loyalty, providing a competitive edge in a fragmented market.

• The use of artificial intelligence (AI) and data analytics can optimize content recommendations, enhance viewer experience, and improve ad targeting, leading to better monetization.

• Investing in virtual reality (VR) and augmented reality (AR) can create immersive viewing experiences, opening new avenues for storytelling and audience engagement.

• The shift towards digital media has opened new opportunities for digital advertising. Brands are increasingly leveraging social media, influencer marketing, and programmatic advertising to reach their target audiences effectively

• The ability to deliver personalized ads based on user data can significantly enhance ad effectiveness and ROI.

• The global interest in Indian culture and entertainment provides opportunities to export Indian content. Collaborations with international production houses and streaming platforms can help Indian content reach a wider audience.

Threats

• The evolving regulatory landscape for digital content poses a challenge. Stricter regulations on content standards and censorship could impact creative freedom and operational efficiency.

• Changes in advertising regulations, such as restrictions on certain types of advertisements, can affect revenue streams.

• The widespread issue of digital piracy threatens revenue and undermines the value of original content. Efforts to combat piracy through technology and legal measures are essential but remain a significant challenge.

• Ensuring robust IP protection and enforcement mechanisms is critical to safeguarding the interests of content creators and producers.

• The proliferation of content platforms and channels has led to audience fragmentation, making it challenging to capture and retain viewer attention.

• The entry of global players and the rapid growth of local competitors have intensified competition. Differentiating content and maintaining a competitive edge is becoming increasingly difficult.

• Keeping pace with rapid technological advancements and ensuring the adoption of new technologies can be challenging. Failure to innovate can lead to obsolescence

• The increasing reliance on digital platforms makes the industry vulnerable to cybersecurity threats. Protecting sensitive data and ensuring secure transactions are paramount.

• Economic fluctuations and slowdowns can impact advertising revenues and consumer spending on entertainment. The industry needs to be resilient and adaptable to economic changes.

• As the market becomes saturated with content, standing out and attracting viewers becomes more challenging. Content quality, innovation, and effective marketing strategies are crucial to overcoming this threat.

C. SEGMENT WISE PERFORMANCE

The segment wise performance has been shown elsewhere in the Annual Report.

D. OUTLOOK

The Indian media and entertainment (M&E) industry is diverse and dynamic, encompassing various segments such as television, film, digital media, print, music, radio, and live events.

Our main businesses are:

1. Creating original and diverse show content;

2. Exploring opportunities across channels, languages;

3. Building our marketing and distribution capabilities;

4. Creating newer show formats for television content;

5. Leveraging opportunities in regional markets by expanding network.

The Indian media and entertainment industry is undergoing a transformative phase, with digital media leading the growth trajectory. While traditional segments like television and print face challenges from digital disruption, they continue to hold significant value. The film and music industries are leveraging digital platforms to expand their reach, and live events are rebounding with hybrid formats. Overall, the industry is set for continued growth, driven by technological advancements, innovative content, and evolving consumer preferences. Addressing challenges such as piracy, regulatory changes, and monetization strategies will be crucial for sustained success.

E. RISK AND CONCERNS

The Indian media and entertainment (M&E) industry is a rapidly evolving sector with significant growth potential. However, it also faces several risks and concerns that could impact its progress.

Being a content driven entity, we are strengthening our intellectual property to ensure cost optimization at all levels. The four key pillars that continue to influence the digital Media and Entertainment space are infrastructure; mobility, government policy and digital technologies. We continue to have a readily available database of our IP, such as scripts, dialogues, clips and other content. The following risks and challenges are affecting our business:

1. Censorship and Content Standards: Stringent content regulations and censorship laws can limit creative freedom and affect the type of content produced. The lack of clear guidelines can lead to arbitrary decisions, impacting the industrys ability to innovate and address diverse audience interests.

2. OTT Regulation: The increasing scrutiny and potential regulation of OTT platforms could affect the flexibility and variety of content offered. New policies might impose restrictions on content types, age ratings, and advertisements, posing challenges for content creators and distributors.

3. Digital Piracy: Piracy remains a significant concern, especially with the easy availability of pirated content online. This not only affects revenue but also undermines the value of original content.

4. Data Breaches: Increasing digital consumption exposes the industry to cybersecurity threats, including data breaches and hacking. Ensuring robust cybersecurity measures is essential to protect sensitive content and consumer data.

5. IP Protection: Weak intellectual property enforcement can discourage investment in high-quality content production and impact the overall growth of the industry.

6. Impact on Advertising Revenue: Economic downturns can lead to reduced advertising budgets, impacting the primary revenue source for many media companies. This can lead to a contraction in spending on content production and innovation. While the Indian media and entertainment industry is poised for continued growth, it must navigate a landscape filled with regulatory, technological, economic, audience behavior, and operational risks. Addressing these challenges through strategic planning, innovation, and adaptive measures will be crucial for sustaining growth and maintaining competitiveness in this dynamic sector. Broadcasting companies pay transponder charges to satellite companies for transmission of their TV signals. The tax authorities contend that payments made towards transponder charges are in the nature of royalty.

India boasts a comprehensive data privacy law, the Digital Personal Data Protection Act (DPDPA) 2023, M&E companies stand at the threshold of a new compliance era. While the government is in the process of rolling out rules to operationalize DPDPA, M&E companies must grasp the impact and adapt swiftly to the evolving landscape of data privacy.

F. INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Companys internal control systems are commensurate with the nature of its business and the size and complexity of its operations. These are routinely tested and certified by Statutory as well as Internal Auditors and cover key business areas. Significant audit observations and follow up actions thereon are reported to the Audit Committee.

Your Companys Internal Control system is designed to:

• Safeguard the companys assets and to identify liabilities and managed it accordingly.

• Prevention and detection of Fraud and Errors

• Ensure that transactions are properly recorded and authorized.

• Ensure maintenance of proper records and processes that facilitates relevant and reliable information.

• Ensure compliance with applicable Laws and Regulations.

The Audit Committee of the Board of Directors is active in checks and balances that ensure the adequacy and effectiveness of the internal control systems. This committee suggests improvements to strengthen the internal controls and ensure their ongoing effectiveness.

The CMD/CFO Certification provided elsewhere in the report discusses about the adequacy of our internal control systems and procedures.

G. DISCUSSION ON FINANCIAL PERFORMANCE WITH RESPECT TO OPERATIONAL PERFORMANCE

The Company has prepared its standalone and consolidated audited financial statements as per Indian Accounting Standards (Ind AS) for the financial year 2023-24. The standalone and consolidated performance of the Company and its subsidiaries, for the year under review along with previous year figures are given blow:

(Rs in Lakhs)

Particulars	Standalone		Consolidated
	2023-24	2022-23	2023-24	2022-23
Total Income	3,672.68	3,559.61	13,357.99	11,231.68
Total Expenditure other than Financial Costs and Depreciation	2,969.43	2,955.24	11,031.66	9,901.55
Profit before Depreciation & Financial Charges	699.03	594.08	2,307.60	1,301.49
Financial Charges	378.18	366.96	1,005.84	932.90
EBIDTA	699.03	594.08	2,307.60	1,301.49
Depreciation and Amortisation Expense	173.55	225.64	478.33	523.51
Profit before Tax	147.30	1.48	823.43	(154.92)
Provision for Tax	46.71	39.15	165.02	22.83
Profit after Tax	100.59	(37.67)	658.41	(177.75)
Proposed Dividend	Nil	Nil	Nil	Nil

The details of the financial performance of the Company are appearing in the Balance Sheet, Profit & Loss Account and other financial statements appearing separately.

H. MATERIAL DEVELOPMENT IN HUMAN RESOURCES

BAG considers Human Resources to be one of the key elements to sustain competitive advantage in the News Media Sector. Media organizations are human driven; its growth depends upon the quality contribution made by the people in the organization. Therefore, your Company recognizes human resources as a key component for facilitating organizational growth.

BAG understands that the M&E industry is rapidly evolving and it is crucial to keep up with the latest trends and technologies to stay competitive. The Company provides regular training and development programs to its employees to ensure that they are equipped with the necessary skills and knowledge to perform their roles efficiently. These programs include on-the-job training, mentoring, coaching and leadership development programs.

BAG aims to recruit, nurture and retain quality professionals and provide them with a high performance environment. Knowledge and intellectual assets are being strategically shared across BAG. The Company has 23 permanent employees on the roll of the Company as on March 31, 2024. At BAG, we have understood the potential of the human resource and its contribution to the financial standing of your company. Therefore, the human asset is highly valued and regarded by your company.

We would like to thank all our employees for their contribution and we look forward to their continued support in maintaining our leadership position in the industry. We would also like to thank all our shareholders for continuing to trust and believe in the Company and look forward to your continued support as we scale new heights with BAG..

I. KEY FINANCIAL RATIO

As per the SEBI Listing Regulations, the company is required to give details of significant changes (i.e. 25% or compared to the immediately previous financial year in key-sector-specific financial ratio.The Company has no significant changes in any key financial ratio during FY 2022-23 and FY 2023-24.

Discussion on Standalone Financial Performance with respect to operational performance are hereunder:

(Rs. in Lakhs)

Particulars	2023-24	2022-23	Growth (in %)	Reason of Change
Revenue from Operation	3,595.08	3,531.71	1.79	Substantial increase in margin figures before and after tax is due to increase in content production expenses, which is shown as increase in the finished stock. This will be realisable in near future.
Gross Margin	0.26	0.25	3.73
EBIDTA	699.03	594.08	17.67
PBT	147.30	1.48	9872.94
PAT	100.59	(37.67)	367.01
Current Ratio	0.96	0.93	3.64
Net Profit Margins	2.92	(0.77)	476.00
Debt Equity Ratio	0.12	0.15	(18.58)
Interest Coverage Ratio	1.39	1.00	38.39
Return on Net Worth	0.93	0.90	3.18
Debtors Turnover	3.89	3.49	11.51
Inventory Turnover	1.03	1.17	(11.53)

Cautionary statement

Statements in the Management Discussion and Analysis and the annual report describing the Companys objectives, projections, estimates, expectations may be "forward-looking statements" within the meaning of applicable securities laws and regulations in India and other countries. Actual results could defer materially from those expressed or implied. Important factors that could make a difference to the Companys operations include economic conditions affecting the domestic market, in which the Company operates, changes in the Government regulations, tax laws and other statutes and other incidental factors and unforeseen circumstances.

(*Source of information: FICCI-EY-Report Indian M & E Sector, 2024)