Universal Arts Ltd Management Discussions

1. INDIAN ECONOMY AND BUSINESS ENVIRONMENT

The Indian economy continues to be one of the fastest growing in the world. For FY 2025-26, the Reserve Bank of India has projected GDP growth of around 6.5%, supported by strong domestic demand, government reforms, and improving global linkages.

With rising incomes, rapid urbanization, and the widespread adoption of mobile and digital platforms, Indias long-term economic outlook remains robust. This growth is also fueling demand in the entertainment space, where consumption of films and digital content is rising rapidly.

2. MEDIA AND ENTERTAINMENT SECTOR OVERVIEW

The Indian Media & Entertainment (M&E) sector has reached a size of approximately INR 2.5 trillion in 2024 and is expected to grow by about 7% in 2025, crossing INR 2.7 trillion. The industry is undergoing a major transformation — digital media has now overtaken television as the largest segment.

However, the subscription-based revenues are under pressure due to changing audience preferences and availability of low-cost or bundled content. In addition, increased competition, changing technology, and rising content costs have created significant challenges for companies operating in this space.

Despite these challenges, the sector holds strong promise as India continues its digital revolution. Companies that can adapt quickly, strengthen their digital presence, and create innovative content are likely to capture long-term growth, although achieving this will also require significant investments in technology, content, and distribution.

3. INDIAN TELEVISION & FILM INDUSTRY

Television, Print and Films are the largest segments constituting nearly 80% of the M&E market. The trajectory for the countrys digital revolution is expected to reach more than a billion users by 2028.

India produces over a thousand films every year, making it one of the largest movie producers in the world. While Indian cinema is popular globally for its drama and colour, OTT platforms with over 547 million users in 2024 are now reshaping audience behaviour, as viewers prefer flexible, on-demand access to entertainment.

The movies released in theatres come on the OTT platforms in hardly two months time period. The OTT platforms are taking over the Indian Television and Film Industry with the presence of giants such as Amazon, Netflix, JioHotstar, etc. in the Indian Entertainment Industry. The merger of Disney+ Hotstar and JioCinema into JioHotstar in 2025 marks a new phase of consolidation and aggressive content expansion in the industry and it has further intensified competition, creating even bigger players in the market and raising the scale of content expansion across the industry.

Your Company is primarily engaged in the buying and selling of film rights, which continues to be a highly competitive and resource-intensive segment. The industry is witnessing shorter theatrical-to-OTT release windows, increasing demand for diverse content libraries, and rising acquisition costs. Coupled with limited financial resources, this has posed significant challenges for the Company in scaling operations at par with larger players.