Sri Adhikari Brothers Television Network Ltd Management Discussions

The Company was admitted to the Corporate Insolvency Resolution Process ("CIRP") by the order of the Hon?ble National Company Law Tribunal ("NCLT"), Mumbai Bench, dated December 20, 2019 ("Insolvency Commencement Date"), under the provisions of the Insolvency and Bankruptcy Code, 2016 ("Code"). In connection with the CIRP, the Hon?ble NCLT, by its order dated December 08, 2023, approved the Resolution Plan submitted by the Resolution Applicants. Following this, the Board of Directors were reinstated on December 26, 2023.

In accordance with the Code and the NCLT order, the approved Resolution Plan is binding on the Company, its employees, members, creditors, including the Central Government, any State Government, or local authority to whom any dues are owed, as well as guarantors and other stakeholders involved in the Resolution Plan until the date of the approved order. The Company has focused on the swift implementation of the Resolution Plan, channelizing all its efforts towards restoring its financial stability and pursuing new-age media business activities to regain its former financial strength. Over the past nine years, since the unfortunate passing of Shri Gautam Adhikari, the Promoters have worked diligently to build the necessary competencies to fill the void he left. The significant growth in the digital media sector has also played a crucial role in this endeavor.

On May 27, 2025 our company completed the entire resolution plan one year in advance and paid off all the Financial Creditors and Operational Creditors as per the plan. This momentous feat could be achieved by the company only because of the unwavering support of our investors, shareholders, employees, bankers, clients, consultants and regulators.

Our strategic vision for the upcoming year is optimistic, focusing on expanding our digital media footprint and leveraging technological advancements to enhance production and distribution. Growth will be driven by strategic partnerships and a diversified content portfolio to capture a wider audience and increase revenue streams. Despite potential regulatory changes, we remain dedicated to compliance and proactive engagement with authorities to ensure sustainable growth and operational excellence.

Indian Macroeconomics scenario (Source: FICCI report on Media & Entertainment dated March 01,2025)

India?s media & entertainment sector is undergoing a transformative shift, driven by digital adoption, evolving consumer preferences, and innovative business models. Indian M&E sector grew by 3.3% in 2024, it grew by INR 81 billion to reach INR 2.5 trillion (US$ 29.4 billion), 30% above its pre-pandemic levels in 2019.

The M&E sector contributes 0.73% to India?s GDP Growth slowed down significantly in 2024, to just INR81 billion which was less than half the INR185 billion growth of 2023. New media (comprising digital media and online gaming) grew INR113 billion (12%) and now comprise 41% of the M&E sector?s revenues

Outside the home media (comprising filmed entertainment, live events and OOH media) grew at a combined 3%, and now contribute 14% of the total M&E sector

Media and Entertainment Industry:

(Source: FICCI report on Media & Entertainment dated March 2025)

India is a unique market where the M&E sector distinguishes itself through a harmonious fusion of tradition and innovation. Here, technology-enhanced entertainment channels, OTT platforms, AI-powered newsreaders, traditional print media, flagship films, and short-form content not only coexist but thrive together, showcasing the vibrant diversity and dynamic growth of our industry. The Government of India?s thrust on improving digital infrastructure in the country combined with our ambition to be at the forefront of the next big technological thrust in media and entertainment, our sector is primed for a massive transformation.

Key highlights:

Digital media is expected to grow to INR 1.1 trillion by 2027:

It is estimated that the digital segment will be the first M&E segment to cross INR1 trillion in 2026 and will grow to INR 1.1 trillion by 2027, at a 11% CAGR, reflecting the changes in consumption patterns being witnessed due to growth in connected televisions, mobile phones and affordable broadband connectivity.

A billion screens by 2030:

India is expected to have almost a billion active screens by 2030. Of these, around 240 million will be large (TV, laptop, PC), while the remaining will be small (mobile phones, phablets). Pay TV, Free TV, and Connected TV are expected to emerge as significant markets, each comprising between 60 to 80 million homes. The 3:1 ratio in favour of mobile phones will sustain the demand for short videos and social commerce.

Online gaming is expected to reach INR 316 billion by 2027:

The online gaming segment is projected to grow at a CAGR of 10.8% over the next three years, reaching INR316 billion by 2027. The segment will see growth across all its verticals, including esports, fantasy sports, casual gaming, and other games of skill to use INR Revenue growth will be led by mobile-based real-money gaming and casual gaming.

Market Dynamics:

According to FICCI report, The Indian Media and Entertainment sector to grow 7.2% in 2025 to reach INR 2.68 trillion (US$31.6 billion), then grow at a CAGR of 7% to reach INR 3.07 trillion (US$36.1 billion) by 2027.

However, Growth slowed down significantly in 2024, to just INR81 billion which was less than half the INR185 billion growth of 2023, Digital media, live events and OOH media led the growth in 2024.

Except for television, all M&E segments grew in 2023, but the share of core traditional media (television, print, filmed entertainment, live events, out of home, music, radio) stood at 41% of M&E sector revenues, down from 3% or INR 30 Billion.

On the other hand, new media (Digital media, Live Events, OOH, Radio) grew the most, grew at a combined 3%, and now contribute 14% of the total M&E sector.

Television: Linear television revenues fell for the second year in a row, despite viewership remaining largely flat. Advertising revenue fell 6% on the back of a corresponding fall in ad volumes and a 10%+ fall in advertisers on the medium. Subscription revenues fell 3% due to a reduction in six million Pay TV homes as both Free TV and Connected TV homes grew. Connected TVs (whose revenues are included under digital media) grew to around 30 million, up from 23 million in December 2023

Digital advertising: Digital advertising grew 17% to reach INR 700 billion, constituting 55% of total advertising revenues. This figure includes advertising by SME and long-tail advertisers totalling over INR 258 billion, and advertising earned by e-commerce advertising and social media amounting to INR 147 billion.

Digital subscription: Digital subscription grew 15% to reach INR 102 billion Paid video subscriptions grew by 11 million in 2024 to 111 million, across 47 million households in India. Paid music subscriptions grew from 7 million to 10.5 million as music streaming platforms disincentivized free usage, while news remained sub-scale at just 3.1 million paid subscriptions.

Government Initiatives

(Source: https://www.ey.com/content/dam/ey-unified-site/ey-com/en-in/insights/media-entertainment/documents/ey-a-studio-called- india-v1.pdf )

(Source: https://www.ibef.org/industry/media-entertainment-india )

India is currently going through a phase of digital transformation, M&E sector is also witnessing rapid shifts which is happening with the availability of online media content. Accessibility of content over the internet has come with the availability of fairly affordable smartphones and data across every nook and corner of the country. Speaking about digital infrastructure, he informed that India has 90 crore internet users, 60 crore+ smartphones and 4 crore+ connected TVs.

The Indian Media & Entertainment (M&E) sector is set for substantial growth, with a projected 10.2% increase, reaching INR 2.55 trillion (US$ 30.8 billion) by 2024 and a 10% CAGR, hitting INR 3.08 trillion (US$ 37.2 billion) by 2026. Advertising revenue in India is projected to reach INR 330 billion (US$ 3.98 billion) by 2024. The share of traditional media (television, print, filmed entertainment, OOH, music, radio) stood at 57% of the media and entertainment sector revenues in 2023.

The country?s entertainment and media industry is expected to see a growth of 9.7% annually in revenues to reach US$ 73.6 billion by 2027.

The Indian media and entertainment sector posted a robust 19.9% growth in 2022 and crossed the INR 2 trillion (US$ 24 billion) mark in annual revenue for the first time led by a sharp jump in the digital advertising mop-up.

Advertising revenue in India is projected to reach INR 330 billion (US$ 3.98 billion) by 2024.

Company Profile:

Sri Adhikari Brothers Television Network Limited (SABTNL) is a listed public-limited Company incorporated in 1994. The Company is a media company and operates in the field of content production and syndication of content to various broadcasters, aggregators and satellite networks.

Financial Performance - Overview

During the year under review, the Company incurred Loss before tax of Rs. Lakh 2,236.83 as against Loss before tax of Rs. 2,160.20 Lakh in the previous financial year. The Loss after tax was Rs. 2,236.83 Lakh during the FY 2024-25 as against Loss after tax of Rs. 2,160.20 Lakh in the previous financial year.

Critical accounting policies:

The principles of revenue recognition are as under:

Revenue from sale of program/content rights is recognized when the relevant program/content is delivered.

In respect of Interest Income, it is recognized on a time proportion basis taking into account the amount outstanding and the rate applicable.

Segment wise Performance

The Company is operating in single primary business segment i.e. Content Production and Syndication. Accordingly, no segment reporting as per Accounting Standard-17.

OPPORTUNITIES AND THREAT Opportunities:

Largest Industry: The Indian film industry is one of the largest globally with a history of steady growth. With films being the most popular form of mass entertainment in India, the film industry has witnessed robust double-digit growth over the past decade.

Learning Curve: The immense experience of the promoters in the media industry has proved to be an added advantage in understanding the taste of audience and producing differentiated contents.

Digitization and Convergence: Digital platforms like DTH, digital cable, IPTV and convergence media is expected to transform the landscape of the industry by enabling players to leverage on cross media synergies and attract a whole set of new viewers. Each platform is expected to create its own demand for audio and video content.

Challenges_and_Threats:

External Risk:

Competition from other players - Company operates in highly competitive environment across all its business segments that are subject to innovations, changes and varying levels of resources available to each player across segment. Failure to remain ahead of the curve or respond to competition may harm the business.

Differentiated Products: Due to increase in the number of production house, the project produced needs to be unique to attract viewers. Also, with a view to produce differentiated content, the production cost also increases.

Production cost: The risk of getting the production getting extended the projected date or the risk of over spending during production. It requires large outlays of money that cannot be recovered if the project fails at any stage. Delay in planned release also shoots the whole production cost high.

Piracy: Piracy continues to be one of the major issues affecting the Indian film industry with an annual loss of substantial revenues. Over time, movie piracy has shifted from CDs and DVDs to online platforms. The modus-operandi involves use of sophisticated smartphones and camcorders to record films in theatres and then publish them on websites. With increased penetration of smartphone devices and cheaper data charges, the situation is becoming worse each year.

Internal risk:

Change in Consumer Preference Risks:

The taste of the viewer is changing rapidly; accordingly the production has to match with the expectation of the audience. Many a times even after much work on the project, the project doesn?t appeal the target audience as the target audience preferences are bound to change. The level of creativity required for the audience targeted varies with the available options to the consumers.

Technological Risks:

Rapidly evolving technology and changing consumer preferences can make it difficult to attract and retain customers.

Regulatory Matters:

The business may have a positive or a negative impact on the revenues in future due to changes in the regulatory framework and tax laws as compared to the current scenario.

Consumer analytics has become indispensable: Analytics is being used extensively across the M & E now, as the organisations look to evolve their business models and address various challenges emerging in competitive markets. Analytics is being used to gauge the effectiveness of marketing efforts and thus helps in strategizing accordingly to achieve maximum Return on Marketing Investment (ROMI). With the evolution in technology, data availability increases and organisations need to invest significantly in gathering, analyzing and interpreting data to optimise customer engagement.

Artist attrition risk:

The reason for which the Company?s content is preferred by the audience includes artist attraction also. These artists are an important part for the content produced by the Company. The attrition of these artists could affect the consumer preferences.

Revenue Risks

The Company earns revenue either by selling commissioned programs or Syndication of various content to various broadcasters, aggregators and satellite networks.

The sustainability of the programs is mainly dependent on the concept, content and the technical expertise. Apart from this, Television

Rating Points (TRP) is one of the key indicators, which decide the popularity of the program as well as sustainability of the program. Internal Controls and Adequacy of those controls

Adequate systems of internal controls that commensurate with the size of operation and the nature of business of the Company have been implemented. Risks and controls are regularly viewed by senior and responsible officers of the company that assure strict adherence to budgets and effective use of resources. The internal control systems are implemented to safeguard Company?s assets from unauthorized use or disposition, to provide constant check on cost structure, to provide financial and accounting controls and implement accounting standards.

Human Resources

As on March 31,2025, the company has 2 permanent employees on its payroll.

Exports

The Company deals in the media contents and mainly in the domestic market thus having no exports.

Details of significant changes in key financial ratios:

Sri Adhikari Brothers Television Network Limited. (Standalone)

Interest Coverage Ratio: Loss for this financial year has increased which has resulted in the change of the ratio.

Debtors Turnover Ratio: The trade receivables has reduced as compared to last year due to which there is a change in ratio

Debt Equity Ratio: The borrowings of the Company has reduced as compared to last year due to which there is a change in ratio.

Operating Profit Margin: The loss of the Company has increased as compared to previous year due to which there is a change in ratio.

Return on Net Worth: The return on Networth is negative, due to loss in current year & previous year.

Note: Debt Equity Ratios has only long term loan from instructional as a debts.

Cautionary Statement

Statements in the Management Discussion and Analysis Report describing the Company?s objectives, projections, estimates, expectations may be "forward-looking statement" within the meaning of applicable securities laws and regulations. Actual results could differ materially from those expressed or implied. Important factors that could make a difference to the Company?s operations include economic conditions affecting demand/supply and price conditions in the domestic and overseas markets in which the Company operates, changes in the Government regulations, tax laws and other statutes and other incidental factors.