Balaji Telefilms Limited — Q2 FY26 earnings call

Call held 14 Nov 2025

Management summary

Balaji Telefilms reported a challenging Q2 FY26 with significant revenue decline to INR48.8 crores and a loss after tax of INR4.9 crores, primarily due to the conclusion of mature TV series and softness in broadcaster budgets. However, the company demonstrated sequential EBITDA improvement, maintained strong cash reserves of INR137 crores, and built a robust digital B2B order book of INR300 crores. Strategic initiatives like new app launches (Kutingg, AstroVani) and a strong movie pipeline are expected to drive future growth, with significant tax benefits from mergers also providing a long-term advantage.

Highlights

  • EBITDA improved sequentially from negative INR8.8 crores (Q4 FY25) to negative INR4.3 crores (Q2 FY26).

  • Strong cash reserves of INR137 crores provide comfortable liquidity for growth plans.

  • Digital B2B order book stands at approximately INR300 crores with various leading OTT platforms.

  • INR117 crores of GST input credit available post-merger, helping conserve cash.

  • Over INR100 crores of brought forward losses will result in no tax incidence for 4-5 years, improving PBT and PAT.

Concerns

  • Q2 FY26 Revenue declined to INR48.8 crores from INR144 crores in the same quarter last year.

  • Q2 FY26 Loss after tax was INR4.9 crores, and EPS was negative INR0.40.

  • Mature TV series ending led to a dip in programming hours and continued pressure on TV episodic revenue (INR24-25 lakhs per hour).

  • High churn rate of 65-70% on SVOD platform.

Key financials

  1. Revenue ₹48.8 Cr -66.1%YoY
  2. Loss Before Tax ₹-6.6 Cr
  3. Loss After Tax ₹-4.9 Cr
  4. EPS ₹-0.4
  5. EBITDA ₹-4.3 Cr +51.1%QoQ
  6. Cash Reserves ₹137 Cr

What they filed

Q1 FY27: revenue up 228.8%, net profit up 420.0% against the same quarter last year.

₹ Cr · quarterly
Line itemQ2 FY25Q3 FY25Q4 FY25Q1 FY26Q2 FY26Q3 FY26Q4 FY26Q1 FY27
Revenue139 93 66 73 49 −65%42 −55%48 −27%240 +229%
EBITDA23 -10 -19 -9 -7 −130%-30 −200%-16 +16%20 +322%
Net profit18 -11 93 -5 -4 −122%-23 −109%-13 −114%16 +420%
How to read this

₹ crore, as filed. The percentage beside a figure is the change against the same quarter a year earlier — never the quarter before, which would make every seasonal business look like it collapses and booms each year.

Segment breakdown

  • Q2 FY26 Revenue Contribution
    77% Commission Segment13% Digital Business10% Film
  • H1 FY26 Revenue Contribution
    68% Commission Contract Segment27% Digital B2C5% Film

Capital allocation

high confidence
  • Capex Capex disclosed
    • Motion Pictures ₹150 Cr
    • Motion Pictures ₹175 Cr
    • Digital Space (working capital) ₹20 Cr
    • Digital Space (working capital) ₹25 Cr
    The total capital, if you ask me, INR150 crores to INR175 crores will be into Motion Pictures. Television doesn't need any capital, so it is totally funded through internal accrual. On digital space, close to INR20 crores to INR25 crores working capital is needed for us.
  • Liquidity Cash ₹137 Cr Strong cash reserves provide comfortable liquidity for growth plans. Funds raised last year amounting to INR131 crores are yet to be utilized.
    Our cash reserves remain strong at INR137 crores, providing comfortable liquidity for our growth plans. The funds raised last year amounting to INR131 crores will be deployed towards strengthening our movie and digital businesses. As of now, we have not used a single rupee from this fund.

Guidance & targets

Movie Releases

  • Number of movie releases Movie Releases · next financial year · High confidence minimum 4
    We will have close to 4 movie releases minimum in next financial year and all are big budget movies.

    — Sanjay Dwivedi

Business Contribution

  • Motion Pictures as biggest contributor Business Contribution · 3-year space · High confidence biggest contributor
    So as I see going forward, I think Motion Pictures will be the biggest contributor to the revenue and profitability followed by digital and then TV. But this is saying -- I am saying in 3-year space.

    — Sanjay Dwivedi

  • TV contribution to revenue and profitability Business Contribution · end of 3 years · High confidence 25%
    But by end of 3 years, I think TV will be the 25% contribution to the revenue and the profitability.

    — Sanjay Dwivedi

Digital Product Revenue

  • AstroVani app top line Digital Product Revenue · first full year · High confidence INR5 crores
    From -- for the first full year, the kind of projections we have with respect to this app is that we anticipate this app to accrue a top line of somewhere INR5 crores.

    — Dhaval Sheth

Overall Performance

  • FY26 performance Overall Performance · this year · Medium confidence remain in same zone as Q1/Q2
    But what I can tell you is whatever you have seen in quarter 1 and quarter 2, I think we will remain more or less in the same zone when we end this year.

    — Sanjay Dwivedi

Digital Product Subscribers

  • Kutingg app active subscribers Digital Product Subscribers · Q3 · High confidence 40,000 to 50,000
    And quarter 3 will be the period in which you will see the similar range would be around 40,000 to 50,000 active subs at any given point of time.

    — Sanjay Dwivedi

What to watch in Q3 FY26

Upside from movie releases

Next financial year (starting April 2026)
Current First big release in April next year
Target Upside in all segments from April next year

Why it matters

Movie business is expected to be the biggest contributor to future revenue and profitability, crucial for overall turnaround.

So our first big release happens in April of next year. So quarter from that quarter onward, you will see an upside into all the segments, okay?

Risks & concerns

  • Decline in revenue and profitability due to mature TV series ending

    high

    The stress in the results is largely due to the mature TV series coming to an end, 3 shows ended during the quarter. This situation occurs once in every 3 to 5 years, and we are currently rebuilding the pipeline for the future.

    Management acknowledged

  • Pressure on TV business episodic revenue due to broadcasters cutting costs

    medium

    TV business episodic revenue will continue to be under a little pressure because broadcast is also looking at cutting cost and the content cost has been reduced drastically by the leading broadcast. So unless somebody comes up and take the punt of kind of investing heavily into this content, we will continue to be in the range of INR24 lakhs, INR25 lakhs per hour episodic revenue.

    Management acknowledged

  • High churn rate on SVOD platforms

    medium

    The churn rate is still pretty high from 65% to 70% churn rate happens on SVOD platform. Management states this is common and requires continuous content engagement.

    Management acknowledged

  • App ban by MIB impacting subscriber base

    low

    The ALTT app was banned by the MIB for 45-60 days, leading to a reset for the new Kutingg app, with subscribers now migrating to the new platform.

    Management explained

Q&A highlights

7 direct
Impact of AI on content creation and cost reduction Direct
So AI is enabling information technology advancement, which we have seen over a period of years. So this is one of those many things which will help us in creating good content, save some cost and maybe speed up the process of creating content. So for us, it is a plus.

Addresses a key technological trend in media and how the company is leveraging it for efficiency, specifically mentioning AI-created content on Kutingg.

Asked by Harshit Khadka

Reasons for profitability and revenue dip, and future strategy Direct
No. So ma'am, if we recollect when we have done the last conference call, we had clearly stated that this year is a year where we are working on creating pipeline for the Motion Pictures business. So our first big release happens in April of next year. So quarter from that quarter onward, you will see an upside into all the segments, okay?

Directly addresses the core financial concerns and outlines the strategy for recovery, emphasizing the movie pipeline and its timing.

Asked by Sneha

Capital allocation between content creation and new digital product launches Direct
So in terms of capital outlay, first, I will answer it. So whatever new initiatives we have taken, apart from maintenance capex, we don't expect anything huge capital outlay into this space. The total capital, if you ask me, INR150 crores to INR175 crores will be into Motion Pictures. Television doesn't need any capital, so it is totally funded through internal accrual. On digital space, close to INR20 crores to INR25 crores working capital is needed for us.

Provides specific figures for capital allocation across different business segments, clarifying investment priorities.

Asked by Sana M

Inventory increase of INR55 crores between September and March Direct
So basically, if you see the way Indian accounting standard permits, the moment you sign an artist or talent or for any other purposes if you do a movie, it goes as advance. Moves into inventory when you go on a floor or when you start the shoot, then the inventory -- all these advances moves into inventory, okay?

Explains the accounting treatment for movie production costs, clarifying the nature of the inventory build-up.

Asked by Parth Chauhan

Outlook for the TV business and industry as a whole Direct
So the linear TV continues to be a decline, okay? That you can see even from the broadcast, which are listed like everybody. Decline is quite visible. I'm not saying TV is going to die. But connected TV will be a play. So there will be -- for us, for us who are content creators, it doesn't make much of difference because whether I'm giving content on a linear TV or whether I'm giving on a connected TV.

Provides management's view on the future of traditional TV, acknowledging its decline but highlighting the company's adaptability to connected TV.

Asked by Nimish Pandya

Utilization plans for cash reserves and tangible impact of recent mergers Direct
Okay. So we raised INR131 crores and the purpose for those utilization proceeds are clearly out there in the list which we have published to the stock exchanges. So primarily INR65 crores will go into Motion Pictures, INR33 crores will go into music rights, movie distribution, digital content space and general corporate purposes is INR32.5 crores. As of now, we have not used a single rupee from this fund.

Details the specific allocation of the INR131 crores raised and clarifies the financial benefits of the merger, including tax advantages.

Asked by Muskaan Malhotra

Kutingg app's primary target audience and long-term vision Direct
Kutingg is primarily for a content which is sought by the masses. It is not meant for ultra it's not for Netflix audiences. So it is meant for masses, and it has all the genre and kind of content and the method in which they want to watch.

Clarifies the strategic positioning of the new Kutingg app, distinguishing it from premium OTT platforms and targeting a mass audience.

Asked by Yashika

2 min read 6 chapters

Detailed narrative

Q2 FY26 Financial Performance Overview

Balaji Telefilms reported a significant decline in Q2 FY26 revenue to INR48.8 crores, down from INR144 crores in the prior year, resulting in a loss after tax of INR4.9 crores and negative EPS of INR0.40. For H1 FY26, revenue stood at INR121 crores, with a loss after tax of INR10 crores. Management attributed this performance primarily to the conclusion of several mature TV series and softness in broadcaster budgets.

Sequential EBITDA Improvement and Cash Position

Despite the challenging top-line performance, the company demonstrated sequential EBITDA improvement, moving from a negative INR8.8 crores in Q4 FY25 to a negative INR4.3 crores in Q2 FY26. Balaji Telefilms maintains a strong liquidity position with INR137 crores in cash reserves, providing comfortable capital for future growth initiatives. The INR131 crores raised last year are yet to be fully utilized.

Strategic Shift Towards Movies and Digital

The company is strategically rebalancing its portfolio, with Motion Pictures and Digital segments expected to drive future growth. INR150-175 crores are allocated for movie production, and INR20-25 crores for digital working capital. The movie pipeline includes 'Vrusshabha' (global release in December), 'Bhoot Bangla' (post-production), and 'Vvan' (under production), with a minimum of four big-budget, presold releases planned for the next financial year.

Digital Segment Expansion and New App Launches

The digital segment continues to be a key focus, contributing 13% to Q2 revenue and 27% to H1 revenue. The company launched Kutingg, a family-friendly short-form content app, and AstroVani, a premium astrology app, in November. Kutingg aims for 40,000-50,000 active subscribers by Q3 FY26, while AstroVani is projected to generate INR5 crores in top line in its first full year. The digital B2B order book stands at approximately INR300 crores.

TV Business Challenges and Future Outlook

The TV segment, while a creative anchor, faces pressure due to the conclusion of long-running shows and broadcasters' cost-cutting. Episodic revenue is expected to remain around INR24-25 lakhs per hour. Management acknowledges the decline of linear TV but sees opportunities in connected TV, aiming for TV to contribute 25% to revenue and profitability within three years.

Benefits of Merger and Tax Efficiency

The merger of ALTT and Marinating Films into Balaji Telefilms is yielding operational efficiencies and significant tax advantages. The company has INR117 crores of GST input credit available and over INR100 crores in brought forward losses, which are expected to result in no tax incidence for the next 4-5 years, thereby conserving cash and improving profitability.

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