Music Broadcast Ltd Management Discussions.


The year gone by witnessed a slowing global economy on account of trade tensions, tight financial conditions, uncertainty surrounding Brexit and slowdown in China. India was able to absorb these shocks mainly due to strong fundamental and policy changes like amendment to insolvency and bankruptcy code, bank recapitalizations etc.

However, Indias economic growth moderated to around 6.8% towards the 2nd half of the fiscal year after post a strong growth of 8.2% in the 1st quarter. The moderation in growth was a result of advanced economies rationalizing their monetary policy leading to rerouting of investments, depreciation of Rupee, strengthening of Crude Prices and a liquidity crunch arising out of the NBFC crisis in the short term. Growth prospects in the medium term will hinge on how quickly the new government is able to kick start investments, improve infrastructure, create jobs and manage rural stress.

The 2019-20 interim budgets focussed on improving the condition of the farmers by announcing the direct cash transfer programme for farmers which could contribute a fiscal stimulus of 0.45% to the GDP. This will give a fillip to rural consumption and demand. Fiscal spending on infrastructure and the rural economy should continue to support domestic activity.

We believe that the Indian economy can grow at double digits for a long time on the strength of its available resources, large population base, entrepreneurial mindset and the current low penetration of products and services. It is important however for policies to address income related issues rather than the supply side to fuel consumption. We hope that a stable government will ensure that the Indian economy reverts to a higher pace of growth, sustained by the resilience of Indias citizens and supported by policy makers and becomes one of the top 3 economies in the world.


Indian media and entertainment industry grew over 13% from Rs.1.48 trillion to Rs.1.67 trillion. While television retained its position as the largest segment and absolute contributor to growth; Digital and Online gaming growth was exceptionally high at 42% and 59% respectively. With its current trajectory, we expect it to grow to Rs.2.35 trillion by 2021 (US$33.6 billion).

Television, the largest segment, grew at the near industry average of 12.1% on the back of a strong performance by regional brands, multiple sporting events and impact properties. TV Advertisement grew at 14% and subscription grew at 11% going forward due to Election and ICC world cup TV Advertising will grow at 10%. However impact of TRAI order on subscription may see a dip in Advertising growth.

Print grew at 0.7%; advertising revenues grew 0.4% in 2018 while subscription grew 1.2% on the back of circulation drives and some cover price increases. Print segment has benefited from the just concluded general elections, particularly on the back of the over 20% DAVP rate increase. In addition, the stabilization of newsprint prices will also protect margins in current financial year.

Digital media grew at 42% on the back of digital infrastructure growth and smart phone penetration Digital advertising grew at 34% and subscription grew at 262%. Advertising on Digital will reach 300 billion by 2021 & Subscription will cross 50 billion by 2021 Online gaming grew across real money gaming (including fantasy and e-Sports) as well as casual gaming, on the back of a 52% growth in online gamers who reached 278 million in 2018.

Live events continued to grow in scale and size on the back of weddings, sports, government spends and large format concerts and theatricals. The film segment crossed Rs.100 billion in domestic theatrical revenues, and was further supported by the growth in Indian film exports, particularly to China, and increasing values for digital rights


Radio grew 7.5% in 2018 to reach Rs. 31.3 billion, taking its share in total advertising to 4.2%. Growth was driven by a 3% ad volume growth, inventory growth from newly operationalized Phase-III stations and non-FCT revenues from digital, content production, events etc. Many radio companies are now providing integrated solutions to advertisers which are believed to be the growth driver of the future. There were over 10,467 advertisers on radio of which 4,262 advertisers were exclusive and did not advertise on TV or print. The local-national split of advertising generated was 40:60 and metro-non-metro split of advertising consumed was 60-40.

Radio easily transcends the barriers of literacy — allowing everyone to comprehend and absorb news and information. The cost of content production is lower than that incurred on audio -visual formats. This allows broadcasting through a plethora of languages, dialects and other creative forms inexpensively and quickly. Radio has also been the last man standing in times of calamity and disaster playing a stellar role in conveying information regarding the relief work, aid and recovery efforts when other mediums became inaccessible.

Most importantly, radio personalises the experience of listeners, driving them to use their imagination while deciphering what is unfolding. Radio is free and does not require data, however cheap that may be. The increasing reliance on radio and its RJs as key influencers for people on the go to get live, accurate and credible information and its ability to drive social change has ensured that the world over, radio has stood strong and it shall do so in India as well, by using access to local insights and local influencers, to create and tell powerful stories.


Indian media and entertainment (M&E) industry grew at a strong 13.4% in 2018, beating GDP growth rate, and reached Rs.1.67 trillion. Increasing disposable income and economic growth with India having second highest number of internet users after China with ~570 million internet subscribers, have worked in the favour of the industry in 2018, which is poised to reached Rs. 2.35 trillion by 2021.

Entertainment Industry is set to expand at a CAGR of 11.8 per cent over 2016–21, one of the highest rates globally. The Government of India has supported Media and Entertainment industrys growth by taking various initiatives such as digitising the cable distribution sector to attract greater institutional funding, increasing FDI limit from 74 per cent to 100 per cent in cable and DTH satellite platforms, and granting industry status to the film industry for easy access to institutional finance. Growth is expected in retail advertisement, on the back of factors such as several players entering the food and beverages segment, e-commerce gaining more popularity in the country, and domestic companies testing out the waters and in improvement in overall sentiment as well as economic activity.


Recognizing the leadership position of MBL, various distinguished bodies have bestowed 73 Awards during the year to the company as listed below;

Name of the Awards No of Awards
ACEF Awards 12
Golden Mikes 19
Goa Fest 1
Shield Awards 1
India Content Leadership Awards 1
New York Awards 8
Kyoorious 2
IRF Awards 20
Mcube 1
Radio Connex 2018 3
Driver of Digital Awards 1
Viketan Awards 1
Total 73


(i) Profit and Loss:

(Rs. in lakhs- rounded off)

Year ended March 2019 Percentage Year ended March 2018 Percentage
Revenue from operations 32,470.76 95.6 29,824.78 93.9
Other Income 578.53 1.7 1,289.79 4.0
Other gains and Losses 931.13 2.7 648.55 2.1
Total Income 33,980 .42 100 .0 31,763.12 100 .0
Licence fees 2,140.05 8.8 2,127.23 8.8
Employee benefit expense 6,894.63 28.2 6,889.26 28.4
Depreciation and amortisation expense 2,710.79 11.1 2,626.92 10.8
Other expenses 12,118.18 49.6 11,099.40 45.8
Finance cost 564.11 2.3 1,497.86 6.2
Total Expenses 24,427.76 100.0 24,240.67 100.0
Profit before exceptional items and tax 9,552.66 7,522.45
Exceptional items - -
Profit before tax 9,552.66 7,522.45
Income tax
-current tax 2,033.20 1,648.07
-Deferred tax 1,357.63 702.68
Profit for the year 6,161.83 5,171.70
Other comprehensive income(net of tax) (3.97) 3.60
Total comprehensive income for the year 6,157.86 5,175.30


Total Income: Our total Income increased by 6.98% from Rs. 31,763.12 lakhs in fiscal 2018 to Rs. 33,980.42 lakhs in fiscal 2019, primarily due to an increase in our revenue from operations by Rs. 2,645.98 lakhs. Other income has decreased by Rs. 428.68 lakhs during this period.

Revenue from operations: Revenues from operations representing Advertisement Revenue increased by 8.87% from Rs. 29,824.78 lakhs in Fiscal 2018 to Rs. 32,470.76 lakhs in Fiscal 2019 primarily due to increase in advertising volumes in Phase III markets and rate hike in Top 12 large markets.

Other income: The other income has decreased from Rs. 1,289.79 lakhs in Fiscal 2018 to Rs. 578.53 lakhs in Fiscal 2019 primarily due to redemption of fixed deposits in March 2018 for repayment of debentures.

Other Gains: This represents net fair value gain on financial assets mandatorily measured at fair value through profit and loss account, net gain on sale of investments and other miscellaneous income. Net gain on investment has increased by Rs. 268.42 lakhs from Rs. 628.10 lakhs in Fiscal 2018 to Rs. 896.52 lakhs in Fiscal 2019.


Total Expenditure: Our total expenses increased marginally by 0.77% from Rs. 24,240.67 lakhs in Fiscal year 2018 to Rs. 24,427.76 lakhs in Fiscal year 2019.

License Fees: Amounts paid towards license fees increased by 0.60% from Rs. 2,127.23 lakhs in Fiscal 2018 to Rs. 2,140.05 lakhs in Fiscal 2019.

Employee benefits expense: Employee benefit expenses were flat at 0.08% from Rs. 6,889.26 lakhs in Fiscal 2018 to Rs. 6,894.63 lakhs in Fiscal 2019.

Depreciation and amortisation expense: Depreciation and amortisation expense increased by 3.19% from Rs. 2,626.92 lakhs in Fiscal 2018 to Rs. 2,710.79 lakhs in Fiscal 2019.

Finance costs: Decrease in finance cost by 62.34% from Rs.1,497.86 lakhs in Fiscal 2018 to Rs. 564.11 lakhs in Fiscal 2019 is because of repayment of borrowings in last year out of IPO proceeds.

Other expenses: Increase in other expenses by 9.18% from Rs.11,099.40 lakhs in Fiscal 2018 to Rs.12,118.18 lakhs in Fiscal 2019 was primarily due to increase in marketing and advertisement expenses by Rs.1,041.31 from Rs. 2,745.41 lakhs in fiscal 2018 to Rs. 3,786.72 lakhs in fiscal 2019 and general inflationary increase in cost offset by savings in provision for doubtful debts and advances due to focus collection mandate during the year.

Net Profits for the year increased by 19.15 % Rs. 5,171.70 lakhs in Fiscal 2018 to Rs. 6,161.83 lakhs in Fiscal 2019 due to above.

Adjusting for the items that will not be reclassified to profit and loss account, total comprehensive income for the year was Rs. 6,157.86 lakhs as against Rs. 5,175.30 lakhs in fiscal 2018.

(ii) Balance Sheet:

(Rs. in Lakhs)
2018-19 2017-18
Total Equity 60,331.89 59,986.14
Total Non-current Liabilities 1,984.48 5,351.42
Total Current Liabilities 10,734.64 4,522.09
Total Equity and 73,051.01 69,859.65
Total Non-current Assets 33,433.50 49,014.05
Total Current Assets 39,617.51 20,845.60
Total Assets: 73,051.01 69,859.65

Total equity comprises of Paid up equity share capital, reserves and surplus and other reserves. The equity capital has reduced in current year due to buyback of 17,45,079 equity shares at an average price of Rs. 326.61 per equity share amounting to Rs. 5699.60 lakhs. The increase in Reserves and surplus is due to the total comprehensive income for the year.

Non-current liabilities represent long term borrowings and employee benefit obligations expected to be settled after one year. During the current year, same has reduced due to (i) re-classification of outstanding Rs. 5,000 lakhs Non- convertible debentures (NCD) to current liabilities as same is payable within 12 months and (ii) increase by Rs.1,563.04 lakhs term loan taken for purchase of Head Office premises in Mumbai.

Current liabilities consist of short term borrowings, trade payables, other current financial liabilities and other current liabilities. The increase in other current financial liabilities is due to re-classification of (i) NCD Rs. 5,000 lakhs due within 12 months in March 2020 and (ii) term loan (Head Office premises in Mumbai) repayment of Rs. 815.50 lakhs due within next 12 months. Trade payable has increased due to advertisement & promotion related liability.

Non- Current Assets comprise tangible and intangible assets, long-term investments, financial assets, deferred tax assets, non- current tax assets and other non- current assets expected to be realizable after one year.

Tangible assets have increased during the current fiscal due to purchase of Head Office premises in Mumbai and other additions. Intangible assets have reduced due to amortisation cost for the current fiscal.

During current fiscal, the Company has redeemed certain existing investments to fund buyback.

Decrease in deferred tax assets is partly due to reversal of impact on account of timing difference of depreciation and amortisation charge and partly due to utilization of unused tax credit (MAT) against tax liability.

Current Assets consists of short-term investments, trade receivables, cash and cash equivalents, other bank balances, other financial and current assets expected to be realized within next twelve months. Current investments have been generated out of current year surplus and reclassification of non-current investment.