Regional Print Media Revenue to Grow by 8-9% This Year, Says Crisil Ratings
New Delhi [India], July 28: Crisil Ratings has forecasted an 8-9% increase in total revenue for regional print media companies this fiscal year. This growth is driven by strong demand from key advertising sectors and a loyal subscriber base.
The rating agency also expects operating profitability to expand by 200 basis points to 20-22%, thanks to softening newsprint prices. This is in addition to the 400 basis points margin expansion achieved last fiscal year.
Advertising revenue, which contributes about two-thirds of the total revenue, is closely linked to economic sentiment and spending by corporates and governments. Manish Gupta, Senior Director and Deputy Chief Ratings Officer at Crisil Ratings, noted, “Economic sentiment remains positive, as reflected by growing budgetary spending on advertisement and marketing by corporates. Advertisement demand from key sectors such as automobiles, FMCG, education, e-commerce, real estate, and services is also buoyant.”
Subscription revenue, accounting for 25% of the sector’s revenue, continues to be strong. Regional players are now expanding their subscriber base to areas adjacent to their existing coverage.
Newsprint prices, a key raw material that makes up 35-40% of total operating costs, have been softening due to modest global demand and easing supply chain issues. Prices had surged by 41% in the financial year 2023 due to logistical disruptions from the Russia-Ukraine war but have since been declining.
Doubts Revealed
Crisil Ratings -: Crisil Ratings is a company that gives opinions about the financial health of other companies. They help people understand if a company is doing well or not.
Regional Print Media -: Regional Print Media refers to newspapers and magazines that are published in local languages and cater to specific areas or regions in India.
Revenue Growth -: Revenue Growth means the increase in the amount of money a company makes from selling its products or services over a period of time.
Fiscal Year -: A Fiscal Year is a 12-month period that companies use for accounting purposes. It may not always start in January and end in December.
Operating Profitability -: Operating Profitability is a measure of how much profit a company makes from its regular business activities, before paying interest and taxes.
Basis Points -: Basis Points are a way to describe small changes in percentages. One basis point is equal to 0.01%.
Newsprint Prices -: Newsprint Prices refer to the cost of the paper used to print newspapers. If these prices go down, it costs less to produce newspapers.
Advertising Revenue -: Advertising Revenue is the money that companies make from selling space in their newspapers or magazines for ads.
Economic Sentiment -: Economic Sentiment is how people feel about the economy. If people feel positive, they are more likely to spend money.
Subscription Revenue -: Subscription Revenue is the money that companies make from people who pay regularly to receive their newspapers or magazines.
