D B Corp Ltd Directors Report.

To

The Members, D. B. Corp Limited

Your Directors have pleasure in presenting to you the 23rd Annual Report together with the Balance Sheet and Statement of Profit and Loss for the year ended March 31, 2019.

Financial Highlights (Standalone Results) Rs. in Mn.
Particulars 2018-19 2017-18
Revenue from operations 24,627 23,112
Other Income 166 238
Total Revenue 24,793 23,350
Operating expenditure 19,584 17,472
EBITDA 5,209 5,878
EBITDA Margin 21.0% 25.2%
Finance Cost 85 67
Depreciation & Amortisation 986 922
Total Expenditure 20,655 18,461
Profit Before Tax 4,138 4,889
Provision for Tax 1,399 1,645
Profit After Tax (PAT) 2,739 3,244
PAT Margin 11.0% 13.9%

Financial Highlights (Consolidated Results)

Rs. in Mn.
Particulars 2018-19 2017-18
Revenue from operations 24,627 23,112
Other Income 166 237
Total Revenue 24,793 23,349
Operating expenditure 19,585 17,474
EBITDA 5,209 5,875
EBITDA Margin 21.0% 25.2%
Finance Cost 85 67
Depreciation & Amortisation 986 924
Total Expenditure 20,656 18,465
Profit Before Tax 4,137 4,885
Provision for Tax 1,399 1,645
Profit After Tax (PAT) 2,738 3,240
PAT Margin 11.0% 13.9%
Dividend as % of face value per share 100% 10%

Review of Performance, Operational Highlights and Future Outlook

India has been the growth leader amongst major economies including Emerging Markets and Developing Economies (EMDEs) over the last five years. According to International Monetary Fund World Economic Outlook (October-2018) - GDP (nominal) of India in 2018, India is now the seventh largest economy of the world. It is behind sixth ranked France and fifth ranked United Kingdom and is expected to overtake them in 2019 when India’s economy is expected to reach US$ 2,958 billion. India will be ranked third in 2019 on the basis of purchasing power parity (PPP).

The Indian economy started the fiscal year 2018-19 with a healthy 8.2% growth in the first quarter on the back of domestic resilience. However, growth declined in every subsequent quarter bringing the annual growth to 6.8% compared to 7.2% in FY 2017-18. The decline in growth has been attributed to a combination of global and domestic factors including rising global financial volatility, normalised monetary policy in advanced economies, externalities from trade disputes, investment rerouting and a slowdown in domestic consumption and investment impulses.

D. B. Corp Limited’s (DBCL) performance for the fiscal year 2018-19 needs to be viewed in the context of aforesaid economic and market environment forces. DBCL delivered another year of resilient performance aided by market development strategies, establishment of long term customer relationships and well planned execution of on-ground marketing efforts.

Your Company maintained its focus on editorial strategy which has led to significant improvement in quality of editorial content, greater readership delight and growth.

As per the Indian Readership Survey (IRS) 2019 Q1, the Dainik Bhaskar Group has maintained its leadership as the Largest Newspaper Group of Urban India. The Dainik Bhaskar newspaper continues to hold the No. 1 position as the largest read newspaper of NCCS A, NCCS B and NCCS AB. The Dainik Bhaskar Group stands as the torch bearer of readership growth, adding 63.55 Lakh new readers. This translates into a growth of 13.7%, majorly in the legacy markets of Madhya Pradesh - Chhattisgarh, Rajasthan, Haryana, Punjab, Gujarat and in the new market of Bihar.

The other key highlights of the abovesaid survey are:

Dainik Bhaskar is Urban India’s No.1 Newspaper (IRS 2019 Q1 : AIR – Urban : Main + Variant)

Dainik Bhaskar Group is Urban India’s No.1 Newspaper Group

(IRS 2019 Q1 : AIR – Urban : Main + Variant : excluding financial dailies)

Dainik Bhaskar is Urban India’s No. 1 Newspaper in NCCS A, NCCS B & NCCS AB segment

(IRS 2019 Q1 : AIR – Urban : Main + Variant)

Dainik Bhaskar has added 8.93 Lakh readers, grows by 18% in Rajasthan, based on AIR – Urban + Rural

Dainik Bhaskar grows by 16%, adds 2.03 Lakh new readers in Bihar, as per AIR – Urban + Rural

As per ABC circulation reported data for July - December, 2018, the Company continues to maintain No.1 circulated newspaper of India as well as leadership in Madhya Pradesh-Chhattisgarh, Rajasthan, Gujarat, Haryana, Chandigarh, Punjab (4 urban Cities), besides maintaining close No. 2 formidable position in other markets.

Dainik Bhaskar successfully added 76,212 (average per day) copies in Rajasthan over the past one year, complemented by the increase in readership in the same state, with the growth of 18% in AIR (Urban + Rural).

As part of other significant developments, the following are noteworthy:

A focused and well-executed circulation expansion strategy has delivered excellent readership results which are recently published. Dainik Bhaskar Group stands as Torch bearer of Readership growth. As per recent IRS Survey, all Hindi Newspapers added 93.27 Lakh new readers whereas Dainik Bhaskar added 63.55 Lakh new readers, a growth of 13.7% majorly in legacy markets of Madhya Pradesh-Chhattisgarh, Rajasthan, Haryana, Punjab, Gujarat and in newer market of Bihar.

MY FM is maintaining leadership position in Chandigarh, Haryana, Punjab, Rajasthan, Madhya Pradesh and Chhattisgarh and continues to be the largest player in Rest of Maharashtra. Phase III stations’ bottom line is now positive on the back of strong inventory management, programme profile, strong cost efficiencies and growing popularity.

As a part of DBCL’s digital business,www.dainikbhaskar.com, the largest Hindi News website, continues to secure the No. 1 spot in Hindi News and www.divyabhaskar.com continues to remain No. 1 Gujarati website.

Digital business intensified its focus to further strengthen loyal user base and potential monetisation of the platform. It adapted new strategy for user acquisition by moving away from social journalism to serious knowledge-based news journalism, a key to our brand, to build a higher loyal customer base.

Performance highlights of the Company during the year under consideration are as follows:

Standalone revenue from operations and other income was Rs. 24,793 Million witnessing a growth of 6.2% as compared to Rs. 23,350 Million in the previous year.

Standalone advertising revenue grew by 7.4% to Rs. 17,625 Million which includes revenue from print, radio, digital and event business.

Circulation revenue grew by 5.1% to Rs. 5,237 Million from Rs. 4,981 Million largely driven by increase in copies. Circulation revenue has witnessed CAGR growth of around 10% for past 10 years driven by increase in copies and rate growth.

The consolidated gross revenue increased by 6.2% to Rs. 24,793 Million as compared to Rs. 23,349 Million in the previous year.

EBITDA margin of matured business stands at 25.1%.

Major Campaigns / Events during the year

Launched new readers’ engagement scheme ‘Run Banao Karodon Ke Inaam Paao’ to encash the ensuing cricket season - starting from India-Australia series, followed by IPL and then ICC World Cup. Shikhar Dhawan was roped in as an ambassador to garner interest among non-readers, which duly reflected in the circulation number.

Launched ‘Mahabharat 2019’ an exclusive drive at Pan-India level on Lok Sabha election with the introduction of special election jacket and special election pages. The initiative continues to gather huge readership appeal through various special properties on election with the aim to bring extensive ground coverage and in-depth analysis for its readers.

MY FM concluded a massive 360-degree campaign ‘Aapki Marzi’ for its listeners in Maharashtra in order to keep the content in sync with the listeners’ expectations. Marathi content was expanded across the stations in the state, basis the feedback received. MY FM launched this new show to infuse fun, positive and light-hearted listening during the late evening time featuring the non-clich on-air friend ‘Dev’.

Launched ‘Paison ka Ped’ in 11 cities - India’s First Radio Reality Show where people from various walks of life are selected through a series of auditions and interviews.

Final 30 go through a series of tasks holding the branch of a tree to win cash prize of Rs.3 Lakh / 5 Lakh.

‘MY FM Jashn’ concluded in Jaipur and Indore. Events were starred by two mega artist Vipul Goel (Stand-up Comedian) and Kavi Sammelan Kumar Vishwas and Team which was attended by over 10,000 audiences in both the cities.

‘Rangrezz’ Season 5 - MY FM concluded the largest painting competition in Tier II and III markets with a participation of ~2.7 Lakh kids.

Print Business

The Print Business of DBCL has delivered top of the industry results with 7.3% advertising growth over last year and circulation growth of 5.1% over last year. The circulation expansion strategy has yielded better than expected results with Dainik Bhaskar becoming No.1 newspaper of Rajasthan.

The Hansa Research Group undertook a commissioned Bihar Readership Research in July, 2018 to gauge the readership of various Hindi Newspapers, their readership profile, key product consumptions, readers’ engagement and brand satisfaction. As per this readership report, Dainik Bhaskar was at No. 2 position with an Average Issue Readership (AIR) of 9.11 Lakh, while the legacy player had an AIR of 9.98 Lakh readers.

Emerging Editions / Business

In order to analyse the performance of the Company, its divisions / editions are segmented into emerging and matured editions / business as any new edition / business launched takes long for stabilisation and for earnings.

Disclosure on Compliance with all Secretarial Standards

All the applicable Secretarial Standards are complied with by the Company during FY 2018-19.

Significant and Material Orders passed by the Regulators

There were no significant and material orders passed by the Regulators / Courts / Tribunals which would impact on the going concern status of the Company and its future operations.

Policy Regarding Prevention of Sexual Harrassment at Work Place

The Company has constituted an Internal Complaints Committee (‘ICC’) which looks into complaints of sexual harassment. The victim or a person on victim’s behalf may lodge a formal complaint through a dedicated toll-free Hotline, Website, Email or Post.

During the year under review, only one complaint was received by the Company which was attended to and closed on priority. No. of complaints received during the year: 1 No. of complaints disposed off: 1 No. of complaints pending at the end of the year: Nil

Human Resources and Industrial Relations

Your Company has the reputation for having one of the best HR Departments in the media and allied industries. It has conceptualised and implemented various Human Resource Policies towards betterment of its 9,700+ employees. It maintains a continuous focus on attracting, developing and retaining talent, with the belief that people are its most important differentiator. To ensure sustainable growth and prepare for the future, the Company has been strengthening its talent management, performance management and employee engagement processes.

During the year, it continued to build a high-trust, high-performance culture while endeavouring to build a strong talent pipeline by engaging and hiring talent from renowned campuses, building capabilities. Internal talent grooming is at the core of the organisation. Since a few years, your Company has been implementing structured programme for identification and grooming of high potential people.

Your Company fosters a culture of employee and their family well-being by offering various types of policies and employee benefits. Two unique employee-connect initiatives launched during the year under review were scholarship for meritorious children of employees and Sukanya Samridhi Yojana. These were launched in the memory of the Company’s beloved Chairman Shri Ramesh Chandra Agarwal.

The Company also continues to connect with employees through its trend-setting policies for their welfare like Aapaat Nidhi (a critical medical exigency fund), Saubhagyawati Bhav (assisting employees financially for their daughters’ marriages), Shubh Laxmi (welcoming the birth of girl child), Sparsh (gift on the occasion of the birth of a male child), option to take leave on special occasions (on the anniversaries of employees, family members’ birthdays, paternity & bereavement, etc.).

The HR Culture in the Company has evolved over last 8 years or so from a primitive looking Human Resource function using excel sheets to store employee data, manual payroll processes, no formal assessment procedures to one of the best software using HR function.

General

Your Directors state that no disclosure is required in respect of the following matters as there were no transactions during the year under review, in relation to:

1. Issue of Equity Shares with differential rights as to dividend, voting or otherwise.

2. Issue of Sweat Equity Shares.

3. Non-exercise of voting rights directly by the employees in respect of shares purchased under a scheme pursuant to Section 67(3) of the Act read with Rule 16(4) of Companies (Share Capital and Debentures) Rules, 2014.

Acknowledgements

Your Directors take this opportunity to express their thankfulness and profound gratitude to the Shareholders, Banks, Financial Institutions, Clienteles, Vendors, Central / State Governments and other governing authorities, for their support, continued backing, co-operation and guidance.

For and on behalf of the Board of Directors of
D. B. Corp Limited
Sudhir Agarwal Pawan Agarwal
Managing Director Dy. Managing Director
DIN: 00051407 DIN: 00465092
Place: Mumbai
Date: July 18, 2019
Encl.: Annexure A to E