Radaan Mediaworks (I) Ltd Management Discussions

Jul 22, 2024|12:00:00 AM

Radaan Mediaworks (I) Ltd Share Price Management Discussions

Certain statements made in the management discussion and analysis relating to Companys objectives, projections, estimations and expectations, may constitute ‘forward looking statements within the meaning of applicable laws and regulations. Actual resul ts, performance or achievements may differ from such expectations whether expressed or implied. The important factors, which could have an impact on the companys operations, include pandemic, climatic and economic conditions affecting demand and supply, changes in government regulations and taxation, and other incidental factors over which the Company does not have control. The company assumes no responsibility to publicly amend modify or revise any forward looking statements, on the basis of any subsequent developments, information or events.

Global Overview:

Global real GDP is forecasted to grow by 2.7 percent in 2023, down from 3.3 percent in 2022. The expectation is further slowing to 2.4 percent in 2024. Economic growth is moderating under the weight of still high inflation and monetary policy tightening. Rather than a global recession, expect a relatively subdued economic outlook. Growth is generally strongest in emerging Asian economies and weakest in Europe and the US.

Rapid monetary policy tightening over the last year or so led to weakening in global housing, bank lending, and the industrial sector. However, this weakness has been more than offset by strength in other sectors, most notably service-sector activities, which is visible in labour markets. Strong consumer spending and the fading impact of shocks of recent years have been difficult to assess, leading to ongoing forecast revisions. Nonetheless, recent data point to moderation of these positive trends, leading to slower global growth in the second half of 2023 and early 2024.

Two key risks stand out regarding the global economic outlook. The first relates to inflation. While headline inflation has peaked in most economies, core inflation (excluding volatile items such as food and energy) has proven stickier and has not decisively peaked in many economies. Price Pressures in goods and industrial sectors have receded, and if history is any guide, services prices should likewise moderate over the next quarters. However, the speed of this disinflationary process is hard to assess and will depend on a number of factors including weakening demand and pricing power of firms, labour market dynamics, and pass through from past input price increases. The second risk relates to financial market stability. Central banks tightened monetary policy rapidly and this exposed weaknesses in the banking sector, and financial markets in general. While most indicators point to relative stability in global financial markets, long and variable lags in the pass through of monetary policy mean more financial turmoil could be on the horizon.

Apart from country-specific deviations, such as a possible rebound in US GDP in 2015, business would do well to prepare for a slowing global economic growth environment over the next decade. Relatively slow growth of about 2.5 percent for 2023-24 for the global economy reflects the ongoing pivot to a more modest global GDP growth environment for the next decade, which is estimated at around 2.6 percent, down from an average annual pace of 3.3 percent in the decade leading up to the pandemic.

The 10-year economic outlook signals a prolonged period of disruptions and uncertainties for businesses, but there are also opportunities. Global growth will return to its slowing trajectory with mature markets making smaller contributions to global GDP over the next decade. Nonetheless, there are still opportunities for firms to invest in both mature markets - given their wealth and need for innovation to compensate for shrinking labour forces - and emerging markets - given their need for both physical and digital infrastructure to support their sizable and young labour forces. Keys to ensuring growth over the longer term include developing new lines of business; strengthening corporate culture; embracing digital transformation and automation; recruiting for talent with new skills not currently represented in the company; and maximizing the hybrid work model where it makes sense, as reported by ‘The conference Board.

Indian Economy:

The year began with the anticipation that runaway inflation, aggressive policy rate hikes, and high commodity prices might topple a few major economies into recession in 2023. Now, halfway past 2023 and, while the world is still in the woods, the probability of a recession this year has trimmed. Labour markets in several advanced countries remain tight, while the largest economy, the United States, is seeing a rebound in consumer confidence and spending. Risk spreads are declining on both sides of the Atlantic after the recent banking crisis in the United States. India, meanwhile, enjoys a Goldilocks moment as it sees its economic activity gaining momentum amid continuing global uncertainties. The last quarters GDP data was pleasantly surprising but not completely unexpected. The GDP growth in the fourth quarter has pushed up the full-year GDP growth of FY2022-23 to 7.2%, 200 basis points (bps) higher than the earlier estimate. The recently released Annual Economic Review for the month of May 2023 highlighted that the post pandemic quarterly trajectories of consumption and investment have crossed pre-pandemic levels.

Evidently, economists and analysts are bullish about the Indian economy. Our growth forecasts for FY2023-24 remain similar to our April forecast, although higher-than-expected growth in FY2022-23 has raised our base for comparison. This has raised our lower limit of the range given the buoyancy of the economy. India expects to grow between 6% and 6.3% in FY2023-24 and have a stronger outlook thereafter. In fact, if global uncertainties recede, the expected growth to surpass 7% over the next two years. There are multiple downside risks to our forecasts, but find the uncertainties around the actions of the central banks of major economies and the oil price movements this past quarter particularly interesting.

India grew by 6.1% in the last quarter, which is approximately ~100 bps higher than what the market had anticipated. While the overall growth was broad-based, many sectors such as construction and agriculture experienced more-than-expected growth. In fact, strong growth in manufacturing proved to be a reassuring development as modest growth in the sector in previous quarters had been a concern for policymakers. On the expenditure side, exports performed well despite global headwinds, while imports recorded their slowest growth since December 2020, primarily because of easing crude oil prices bringing down Indias import bills. Private consumption, the largest component of Indias final demand, with a modest growth of 7.5% in FY2022-23, emerged as the weakest link in overall growth. The share of private consumption in GDP fell in the last quarter and was the lowest in the past seven quarters, dragged down by weak rural demand. Urban demand conditions have remained resilient, as evidenced by the sales of mid- to high-end segments of automobiles, the number of UPI transactions, and domestic air passenger traffic data. Rural demand, which was lagging, has also been rising lately, as seen in the sales of tractors, IIP nondurable goods, and Mahatma Gandhi National Rural Employment Guarantee Act data.

Overall, the first-quarter data of FY2024 instils confidence in the improving health of the economy. Inflation in the first quarter was 4.5%, the lowest since the quarter of September 2019. Goods and Services Tax collections remain strong, suggesting that revenue buoyancy will aid in improving the budgeted fiscal deficit ratio to GDP. At the same time, Indias external account h as been improving, thanks to the falling import bills as oil prices ease. Interestingly, the credit-deposit ratio has continued to improve strongly from the lows of the pandemic despite the rising interest rates. A deeper dive reveals that most of the lending is happening in the industry and services sector. This point to improving investment, it means that the supply sides are gearing up to meet the rising demand.

A moderation in the rate hikes by the United States after a spree of rate hikes since February 2022 is a positive news for India. It has reduced the pressures on the RBI to maintain an interest differential needed for the currency carry trade (leveraging the interest-rate arbitrage) and to attract foreign investment (which has declined due to tighter global liquidity conditions).

Global crude oil prices have been trending down over the past few weeks owing to increased oil flows from Russia into the global markets, rising US production, and concerns over oil demand amid a weak economic outlook this year. This is despite the two cuts in oil production by the Organization of the Petroleum Exporting Countries (OPEC) nations since October 2022. Crude prices have been shed more than 40% as of June 2023 since the Russian invasion of Ukraine in February 2022. While WTI fell below US$70 per barrel this week (US$67.1 per barrel on June 12) before going up again, Brent prices have hovered around US$75 per barrel. Since India is a heavy importer of oil and oil products, lower oil prices will reduce import bills and aid in decreasing input costs for products that depend on crude oil or its derivatives, thereby reducing inflationary pressures.

The first-quarter data points to further building on the positive momentum in the economic data. However, it continue to remain optimistic about the economy this year and expect India to grow between 6.0% and 6.3% during FY2023-24 in the baseline scenario, followed by 6.6% and 7.2% over the next two years as the global economy turns buoyant. If downside risks weigh on the economic fundamentals and outlook, may see a substantial economic slowdown.

The worry regarding inflation persists. Despite the recent easing of prices, core prices have not moderated yet. Besides, below- normal monsoon can bring back the pressure on food prices, expectation in the fall in prices to be short-lived as demand picks up along with food prices and the uncertainties around prices remain high (hence, the broad range for forecasts over the next 1.5 years). However, the supply side will probably improve and may help the rebounding economy keep prices under check in the long run (with greater certainties). In any case, inflation expected to remain in the upper range of the RBIs inflation target band over the entire forecast period. The Indian economy will likely to grow steadily over FY2023-24, but uncertainties around the activities of central banks globally and oil price movements pose downside risks is as reported in Deloitte Insights.

Media & Entertainment Industry:

As per the latest report by the EY, Indias Media and entertainment Industry is expected to reach Rs. 2.34 trillion (US$ 29.2 billion), then grow at a CAGR of 10% to reach Rs. 2.83 trillion (US$ 35.4 billion) by 2025. Advertising revenue in India is projected to reach Rs. 394 billion (US$ 5.42 billion) by 2024. The share of traditional media (television, print, filmed entertainment, OOH, music, radio) stood at 58% of the media and entertainment sector revenues in 2022. Indian digital industry is expected to grow at 29% to reach a market size of Rs. 35,809 crore (US$ 4.35 billion) by the end of 2023. It is expected to contribute 38% to the overall advertising industry in India, on par with television. The OTT segment is likely to grow at a remarkable CAGR of 14.1% to reach Rs. 21,032 crore (US$ 2.55 billion) in 2026. Subscription services, which accounted for 90.5% of revenue in 2021, are projected to account for 95% of revenue by 2026.

Within the M&E sector, Animation, Visual Effects, Gaming and Comic (AVGC) sector is growing at a rate of ~29%, while the audio-visual sector and services is rising at the rate ~25%; is recognised as of one of the champion sectors by the Government of India. The AVGC sector is estimated to grow at ~9% to reach ~Rs. 3 lakh crore (US$ 43.93 billion) by 2024. The Indian OTT audience universe currently stands at 424 million people, according to The Ormax OTT Audience Sizing Report 2022. Of these, 119 million are active paid OTT subscriptions in India. Indias SVOD subscriptions reached 130.2 million in 2022 compared to 110.5 million in 2021. As per GroupMs TYNY report 2023, India was ranked 8th by global ad spend, and will continue as the fastest growing market among the top 10 ad markets in 2023. Advertising revenue in India is projected to reach Rs. 394 billion (US$ 5.42 billion) by 2024. Indias subscription revenue is projected to grow at a CAGR of 2% and reach Rs. 432 billion (US$ 4.94 billion). Key growth drivers included rising demand for content among users and affordable subscription packages. The Indian mobile gaming market is growing at a pace in tandem with the global trend and is expected to reach US$ 7 billion in 2025. The online gaming market in India is projected to reach US$ 2.81 billion by 2025, from Rs. 76 billion (US$ 1.08 billion) in 2020, due to rapid increase in consumption. The music industry is expected to reach US$ 400 million by 2025 from US$ 199 million in 2019. About 1 million music streams were played every 3 minutes in FY23, totalling 460 million streams per day, according to a report by Redseer Strategy Consultants. Growth of the sector is attributable to the trend of platform such as YouTube that continues to offer recent and video content-linked music for free, which is expected to drive the paid OTT music sector reaching ~5 million end-users by 2023, generating revenue of ~Rs. 2 billion (US$ 27 million).

By 2025, the number of connected smart televisions is expected to reach ~40-50 million. 30% of the content viewed on these screens will be gaming, social media, short video and content items produced exclusively for this audience by television, print and radio brands. In the third quarter of 2022, smart TV shipments from India increased by 38% YoY, due to rising expansion activities adopted by original equipment manufacturers (OEMs) for their smart TV portfolios. By 2025, ~600-650 million Indians, will consume short-form videos, with active users spending up to 55 to 60 minutes per day. According to the FICCI-EY media and entertainment industry survey, those who watch online videos through bundled packages (online video services bundled with mobile and broadband connections) will account for half of all online video viewers (399 million) by 2023, up from 284 million in 2020. As of 2022, India registered ~527 million online video viewers, including streaming services and videos on free platforms such as YouTube. Mobile video viewers stood at 356 million in 2020, driven by rising number of users preferring video content over the last few years. OTT video services market (video-on-demand and live) in India is likely to post a CAGR of 29.52% to reach US$ 5.12 billion by FY26, driven by rapid developments in online platforms and increased demand for quality content among users.

Company Overview:

The Company and its subsidiary are primarily into television content production, majorly operating in southern regional languages and also engaged in content for OTT platforms. Being in the business for more than two decades, people look upon us for top notch content. We have made history by providing some of the best and most loved shows in all southern languages. Over the years, we have garnered numerous appreciation and awards for our productions, which are the testimonial of our hard work and dedication.

We have long history of telling stories that seek to influence and inspire the consumers, for customers such as our Broadcasters. We generate ratings and viewership on a consistent basis, for talent we offer the ability to become household names and pursue their ambitions.

Radaan presently operates commissioned model of content production though Company prefers sponsorship model, thereby retaining the IP rights for future exploitation in other platforms. The Broadcasters business model is operating almost on funded basis. The opportunity hitherto available on exploitation of IP rights is now completely closed due to the change in the business model. This has hampered our digital footing on a daily basis. Company turned its concentration to produce more on OTT and to create its own space as like in TV sector. Over-the-top players are now more interested to invest for future growth, Company has pipelined original programs for digital streaming through various leading OTT players.

Television Program telecast during 2022-23:

Program Name and Language Broadcasting Channel Category
Chithi2 - Tamil # Sun TV Daily Series
Jameela - Tamil @ Colors TV Daily Series
Ponni C/o Rani - Tamil Kalaignar TV Daily Series
Vani Rani - Tamil - Repeat telecast Kalaignar TV Daily Series

# telecast ended during the financial year @ commenced and concluded during the financial year

Human Resources

The Company fosters a performance oriented work culture and offers amongst the best opportunities in the industry for professional as well as personal growth of its employees. Over the years, the company has built up a strong human resource structure. The Company has qualified and experienced team of professionals in creative, production, finance, legal & secretarial and HR & admin. The Company usually outsources talents and technicians for the project based on the project need and expectation outcome of the content.


Radaan has own post production facilities to meet its own demand on execution of projects. These facilities comprise of seven edit suites including one film competent edit, five voice studios including one RR & FX and one exclusively for Final Mastering. The hardware and software have been sourced to meet quality demands from time to time. The companys state of the art non linear editing suites from Matrix and Discreet Logic run on powerful SGI and IBM workstations connected by a sophisticated broadband network.

Financial Overview:

The discussion and analysis given below relate to the audited financial statements of the Company and should be read in conjunction with them and related notes for the financial year ended 31st March 2023.

The financials of the only subsidiary company viz., M/s.Radaan Media Ventures Pte. Ltd., Singapore did not have any business / operational activities and audit is pending. However, the same has been considered for the consolidated financial statements and also included for the discussion and analysis.

Financial Position:

Property, Plant & Equipment

During the year, after depreciation property, plant & equipment stood at Rs.52.49 lakhs and additions to gross block of fixed assets after adjusting for withdrawals was Rs.0.54 Lakhs. The Company added Rs.96.84 Lakhs on standalone basis, to its gross block of fixed assets, being borrowing cost capitalized for acquiring Land & Building (Commercial Apartment Under-Construction). The Companys net block of fixed assets was Rs.1,800.66 Lakhs (Previous year Rs.1,710.06 Lakhs) on standalone basis. The subsidiary company doesnt have any fixed assets and the consolidated position of fixed assets was sa me as of standalone figures.

Non-current Investments

Investments in Subsidiaries and Associates: - During the year 2022-23 and previous year 2021-22, there is no diminution in the carrying value of investment in Radaan Media Ventures Pte. Ltd. Consequently, the carrying value of those investments remains at Rs.9.35 Lakhs.

Other Investments: - The carrying value of other investment as at end of current financial year was Rs.72.33 Lakhs (previous year end Rs.72.32 Lakhs) both on standalone and consolidated basis. The impairment test has not been carried out for non-current investments.

Non-current Loans and Advances

The carrying value of long term loans and advances as at the end of current financial year was stood at Rs. 22 Lakhs on standalone basis as same in the previous year. The consolidated sum of long term loans and advances were same as of the standalone figures.

Other Non-current Financial Assets

The carrying value of other non-current financial assets representing Gratuity and Leave Encashment Plans as at end of current financial year was Rs.43.62 Lakhs (previous year end Rs.51.82 Lakhs) both on standalone and consolidated basis.

Other Non-current Assets

Other non-current assets, comprising of prepaid taxes, statutory and other deposits stood at Rs.451.65 lakhs for the current year as compared to Rs.445.19 lakhs of the previous year. The consolidated sum of other non-current current assets was same as of the standalone figures.

Deferred Tax Assets

Net deferred tax assets resulted from timing difference of depreciation on fixed assets and provision on reversal of FCT, on standalone basis was Rs.41.79 lakhs as at the current balance sheet date against Rs.38.79 lakhs as at the previous balance sheet date. The subsidiary company has not recognized any deferred tax assets / liabilities and the consolidated sum was same as of the standalone figures.


Inventories on standalone basis, representing work in progress were increased from Rs.82.74 lakhs to Rs.806.30 lakhs, and consolidated inventories were same as of the standalone figures.

Trade Receivables

All the debtors are generally considered good and realizable and necessary provision has been made for debts considered to be bad and doubtful. As at the end of current financial year debtors on standalone basis were decreased to Rs. 103.77 lakhs from Rs.202.21 lakhs, of which, debts outstanding for more than six months were at Rs.25.56 lakhs (net of provisions and written-off) and other debts were decreased from Rs.144.92 lakhs to Rs.78.21 lakhs. The consolidated balance of trade receivables of current financial year were same as of the standalone figures.

Cash and Cash Equivalents

As at the current balance sheet date, the cash and bank balances were increased, on standalone basis to Rs.20.54 lakhs from Rs.13.35 lakhs, and on consolidated basis, the same stood increased at Rs.20.56 lakhs for the current year from Rs. 13.43 lakhs of the previous year.

Short-term Loans and Advances

Short term loans and advances as at the end of current financial year on standalone basis stood at Rs.25.41 lakhs as against Rs.25.68 lakhs of the previous year and on consolidated basis decreased from Rs.7.22 lakhs to Rs.6.95 lakhs.

Other Current Assets

Other Current Assets of current financial year on standalone basis increased and stood at Rs.15.52 lakhs from Rs.6.96 lakhs and the consolidated figures remain as same as standalone figures.

Share Capital

There was no change in share capital of the Company during the financial year 2022-23.

Securities Premium

The securities premium was remained unchanged at Rs.753.65 lakhs, both in standalone and consolidated statements.

Retained Earnings:

The retained earnings at the end of current financial year on standalone basis was stood at (-) Rs.2,988.21 lakhs as against (-) Rs.2,818.47 lakhs of previous year, resulting from current year operating losses. On consolidated basis the retained earnings at the end of current financial year was stood at (-) Rs.3,018 lakhs as against (-) Rs. 2,849.12 lakhs of previous year balance sheet date.

Other Reserves:

The foreign currency translation reserve in the consolidated statements was stood at (-) Rs.4.51 lakhs as against previous financial year of (-) Rs.3.00 lakhs at the current balance sheet date.

Capital reserve in the consolidated statements was increased from Rs.1.85 lakhs as at end of previous financial year to Rs.3.00 lakhs at the current balance sheet date.

Non-current Borrowings

The non-current borrowings as on 31st March 2023 were increased from Rs.2,234.25 lakhs (including current maturities of long term borrowings to Rs.2,744.00 lakhs, including increase in unsecured loans of Rs.380.31 lakhs from directors and Rs. 44.88 lakhs from other corporate. The consolidated non-current borrowings were same as of the standalone position after adjusting intercompany transactions.

Other Non-current Financial Liabilities

Other long term financial liabilities, comprising of customer advances and deposits were increased on standalone basis from Rs.75.93 lakhs to Rs.322.32 lakhs and the consolidated position was same as of standalone, since the subsidiary had no such liabilities.

Current Borrowings

The current borrowings secured loan towards working capital requirement was decreased from Rs.705.19 lakhs as on previous year end to Rs.661.58 lakhs as on 31st March 2023. Since the subsidiary company doesnt have any working capital borrowings other than loan from holding company, which was adjusted for inter-company transaction, the consolidated current borrowings were same as of standalone position.

Trade payables

The trade payables comprising of sundry creditors as at 31st March 2023, on standalone basis increased from Rs. 490.66 lakhs to Rs.609.06 lakhs, and on consolidate basis increased from Rs.494.73 lakhs to Rs.612.55 lakhs.

Other Current Financial Liabilities

Other current financial liabilities comprising of salary payable, taxes and PF/ESI payable was increased on standalone basis from Rs. 109.54 lakhs as on previous balance sheet date to Rs. 179.58 lakhs as on current balance sheet date. The consolidated position of other current liabilities was same as of standalone position.

Financial Performance:


The total income for the current financial year was increased to Rs.1244.48 lakhs as against Rs.1117.20 lakhs of the previous year on standalone. On consolidation for the current financial year was increased to Rs.1245.42 lakhs as against Rs.1117.20 of the previous year. The standalone income from operation for the financial year was Rs.1243.37 lakhs as against Rs.989.35 lakhs, and other income was stood at Rs.1.11 lakhs for the current year as against Rs.127.85 lakhs of the previous year. The other income of the previous year was mainly on account of interest on income tax refund received. As there was no change in the operational income on consolidation, the other income was stood at Rs.2.05 lakhs for the current year as against Rs.127.85 lakhs of the previous year.


The operating expenses both in standalone and consolidated basis were decreased during the year, from Rs. 1064.25 lakhs to Rs.808.13 lakhs. The administration expenses incurred was increased from Rs.263.24 lakhs to Rs.359.25 lakhs and on consolidation of the subsidiary company, the administration expenses was Rs.264.40 lakhs during the previous financial year as against Rs.359.26 lakhs for the current financial year.

The current finance cost for the year was stood at Rs.242.80 lakhs as against Rs.196.10 lakhs of the previous year, for the standalone and on consolidated basis it stood at Rs. 242.86 as against Rs. 196.18 lakhs of the previous year.

Depreciation and amortization expense for the year was decreased on standalone basis from Rs.25.59 lakhs to Rs.7.11 lakhs. As the subsidiary company has no fixed assets, the impact on consolidation of depreciation and amortization expenses was nil and reflects the same figures.


During the year, on standalone basis, Operating Loss before Interest, Depreciation, Tax and Exceptional Items (EBITDA) was decreased to (Rs.77.10 Lakhs), from the operating loss (EBITDA) of (Rs.210.29 Lakhs) of the previous year, and on consolidated basis, the operating losses (EBITDA) during the year was decreased and stood at (Rs.78.04 Lakhs) from the operating loss (EBITDA) of (Rs.211.44 Lakhs) of the previous year.

Net Loss after Tax (PAT) of the Company for the year on standalone basis was Rs.169.81 Lakhs, as against net loss (PAT) of Rs.432.93 Lakhs of the previous year, and on consolidated basis, the Net Loss (PAT) during the current year was stood at Rs. 168.93 Lakhs as against net loss (PAT) of Rs.434.16 Lakhs of the previous year.

Basic and Diluted Earnings / (Loss) Per Share [EPS] computed based on number of equity shares outstanding, as on the Balance Sheet date, is a Loss of Rs.0.31 per share [Previous year: Loss of Rs.0.80 per share] both on standalone and consolidated basis.

Cash Flow

Cash flows from operating activities

In the current financial year the company on standalone basis utilized net cash of Rs.147.95 lakhs in operating activities, as against utilization of Rs. 175.24 lakhs in previous financial year. On consolidated basis the net cash utilisation in operating activity was Rs. 147.92 lakhs as against cash utilisation of Rs. 175.78 lakhs. Other components are provided in cash flow statement.

Cash flows from investing activities

The company has made both on standalone and consolidated basis, a net cash outflow of Rs.68.21 lakh during the year against Rs. 147.92 lakh during the previous year on investing activities. Other components are provided in cash flow statement.

Cash flows from financing activities

The net cash inflow on standalone basis from financing activities during the current financial year was Rs.223.35 lakhs as against Rs. 313.70 lakhs during the previous year. On consolidated basis the net cash inflow from financing activities was Rs.223.28 lakhs against Rs. 313.62 lakhs. Other components are provided in cash flow statement.

Key Financial Ratios - The detailed financial ratio be referred to in Note no: 48 E in the notes on account of Standalone financials together with basis and reasoning in the case of 25% variation between previous year and current year ratio.

SCOT Analysis

Strengths Challenges:
a. Good HR, among others highly talented Creative Team a. Controlling cost of production
b. State of the art infrastructure b. Augmentation of customer base
c. Successful Track Record in Tele-serials c. Dependence on limited talents for creative content
d. Brand Value d. Retention of talent
e. Fully integrated operations e. Changing tastes of the viewers / audience
Threats: Opportunities:
a. Non-availability of adequate skilled Technicians a. Emerging OTT platforms
b. Non-availability of fully reliable viewership rating system b. Expansion of new media trend and usage
c. Low entry barriers c. Increased no of TV content viewers across various platforms
d. Changing government policies d. Increasing Indian Diaspora across the world
e. Piracy e. Improved technology thereby increased access

Internal Control

The Company has strong internal control system commensurating with its size and nature of operation which provide reliable financial and operational information, compliance of applicable statutes, safeguarding of assets, executing transactions with proper authorizations and ensuring compliance of corporate policies. Highest standard of internal control is ensured by regular audit by the internal auditors. The significant observations made in the internal audit reports on internal control measures, if any, are implemented based on the recommendation of Audit Committee of the Board. The statutory auditors of the Company have issued an attestation report on the internal control over financial reporting as stated under section 143 of the Companies Act, 2013.

Risks and concerns

The company depends on deliverables of standard content and exploitation. Relationship with broadcasting channel and any difference of understanding could have material adverse effect on production and telecast of programs.

Company generates revenues from production and assignment of content on a funded basis, which slashes away IP rights of content and thereby denying exploitation of content in all means. Popularity and maintain / attracting viewership is a key for success and any failure could harm business or prevent from growing, which either directly or indirectly could have a material adverse effect on the business prospects, financial condition and results of operations. The viewership rating may also dependant on measurement methodologies which is an external factor to the company.

The companys business depends in part on the adequacy, enforceability and maintenance of intellectual property rights in the entertainment products and services. Piracy of the Companys content, products and intellectual property could result in a reduction of the revenues that the Company receives from the legitimate sale, licensing and distribution of its content and products. The Company devotes substantial efforts to protecting its content, products and intellectual property, but there can be no assurance that the Companys efforts to enforce its rights and combat piracy will be successful.

The substantial revenues for content is generated from the sale of advertising spots by the channel, subscribers for OTT platforms and a decrease in advertising expenditures and drastic fall in subscribers could reduce the demand for the Content, as a cascading effect. Declines in consumer spending due to weak economic conditions could also indirectly negatively impact the advertising revenues by causing downward pricing pressure on advertising because advertisers may not perceive as much value from advertising if consumers are purchasing fewer of their products or services.

The Companys businesses are subject to a variety of laws and regulations. The Company could incur substantial costs to comply with new laws, regulations or policies or substantial penalties or other liabilities if it fails to comply with them. In addition, if there are changes in laws that provide protections that the Company relies on in conducting its business, it would subject the Company to greater risk of liability and could increase its costs of compliance.

Date : 14th August, 2023 For and on behalf of Board of Directors
Place: Chennai Sd/- Sd/-
V.Selvaraj R.Radikaa Sarathkumar
(DIN : 00052444) (DIN : 00238371)
Non-Executive Chairman Managing Director

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