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    D B Corp

    DBCORPGood
    Media, Entertainment & Publication·16 Jan 2025
    Management Summary

    D. B. Corp reported a robust nine-month performance for FY25, achieving its highest-ever revenue and profits despite a high base from the previous year's election revenue. While Q3 FY25 saw a slight revenue dip due to this high base, the company maintained an impressive 29% EBITDA margin. The Radio segment demonstrated strong growth, and the Digital business continued its expansion, reaching 19 million monthly active users. Management expressed confidence in future growth driven by cost controls, stable newsprint prices, and strategic initiatives to boost circulation and digital engagement.

    Highlights

    8

    • 9M FY25 Total Revenue: INR 18,544 million, up 1% YoY.

    • 9M FY25 EBITDA: INR 5,252 million, up 4% YoY.

    • 9M FY25 Net Profit: INR 3,187 million, up 5% YoY.

    • Q3 FY25 Total Revenue: INR 6,556 million, down from INR 6,648 million in Q3 FY24 due to high election base.

    • Q3 FY25 EBITDA Margin: 29%.

    • Radio business 9M FY25 Ad Revenue: INR 1,287 million, up 9% YoY.

    • Digital MAUs: 19 million as of October 2024, with a target to grow 5% QoQ.

    • Company launched an INR 14 crore readers' scheme to boost circulation, targeting 5 lakh new copies in the next year.

    What Changed1

    vs Q1 FY26

    Guidance items10 → 3 (-7)
    Key financials

    Metrics

    6

    Periods

    2

    Q3 FY25

    2
    • Total Revenue
      6,556 Mn
      YoY-1.4%
    • EBITDA Margin
      29%

    9M

    4
    • FY25 Total Revenue
      18,544 Mn
      YoY+1%
    • FY25 Advertising Revenue
      13,058 Mn
    • FY25 EBITDA
      5,252 Mn
      YoY+4%
    • FY25 Net Profit
      3,187 Mn
      YoY+5%

    Segment breakdown

    • Radio Business (9M FY25)1,287 Mn72.3%
    • Radio Business (Q3 FY25)492 Mn27.7%
    Donut· Share of Advertising Revenue

    Guidance & targets

    3
    CategoryTargetPriority
    Newsprint
    Newsprint price stability
    Stable
    		Medium
    Digital
    Monthly Active Users (MAU) growth
    5%
    		High
    Circulation
    Copies gained
    5 lakh
    		High

    Risks & concerns

    6
    RiskSeverity

    Newsprint price volatility

    Analyst questioned if rising newsprint prices could lead to a fall in circulation if prices are raised. Management stated they don't want to burden readers and are exploring forward contracts. — Analyst acknowledged

    medium

    Digital business profitability

    Analyst noted other digital players struggle with profitability; management responded by pointing to overall EBITDA and stating 'prudent business moves' without specific digital P&L. — Analyst downplayed

    medium

    Circulation volume decline

    Management stated they 'certainly have lost some copies' and are implementing an INR 14 crore scheme to regain circulation, attributing some difficulty to distribution in smaller markets. — Management acknowledged

    medium

    Impact of GDP slowdown on ad revenue

    Analyst questioned potential decline in ad revenue categories given 6.4% GDP forecast. Management acknowledged it was a 'downer' but expressed hope for improvement based on government statements. — Analyst acknowledged

    medium

    Areas of Evasion(2)

    • Specific profitability metrics for the digital business
    • Conversion rate for a subscription-based model

    Q&A highlights

    3

    “So, if you really take the government billing out, which was an election impact, I think in this quarter, we are at a mid-single-digit growth. And if I look at the nine months number without the election impact, then we are in the almost double-digit growth.”

    Clarifies the underlying business growth excluding one-off election revenue, providing a clearer picture of core performance.

    asked by Rakesh from Nine Rivers Capital

    2 min read7 chapters

    Detailed Narrative

    01

    Strong Nine-Month Performance Despite High Base

    D. B. Corp reported its highest-ever nine-month performance for FY25, with total revenue growing 1% to INR 18,544 million and EBITDA increasing 4% to INR 5,252 million. Net profit also saw a 5% rise to INR 3,187 million. This growth was achieved despite a high base in the previous year due to election-related advertising revenue, demonstrating underlying business resilience and effective cost control measures.

    02

    Q3 FY25 Performance and Margin Resilience

    For Q3 FY25, total revenue was INR 6,556 million, a slight decline from INR 6,648 million in Q3 FY24, primarily attributed to the high election-filled base of the prior year. Despite this, the company maintained a strong EBITDA margin of 29% for the quarter, with EBITDA at INR 1,902 million. Net profit for Q3 FY25 stood at INR 1,182 million, reflecting the impact of the high base.

    03

    Radio Segment Outperforms

    The Radio business showed robust growth, with advertising revenue up 9% year-on-year to INR 1,287 million for the nine months of FY25. EBITDA for the segment grew 11% year-on-year to INR 451 million over the same period. In Q3 FY25, Radio advertising revenue increased 6% to INR 492 million, and EBITDA grew 2% to INR 187 million, leading industry growth.

    04

    Digital Business Expansion and User Growth Targets

    The company's Digital business continues its growth strategy, with Monthly Active Users (MAUs) reaching approximately 19 million as of October 2024. Management aims to grow MAUs by at least 5% quarter-on-quarter, expanding its outreach to 14 states, including Uttar Pradesh and Uttarakhand. While specific profitability numbers for the digital segment were not disclosed, management affirmed a 'prudent business move' approach.

    05

    Circulation Initiatives and Newsprint Stability

    Acknowledging a slight decline in circulation copies, D. B. Corp has launched a significant INR 14 crore readers' scheme in January 2025 to motivate readers and regain circulation, targeting 5 lakh new copies in the next year. The average cover price remains stable at INR 4.89. Management expects newsprint prices to remain stable in Q4 FY25 and is exploring forward contracts with suppliers to mitigate future price volatility, without passing costs to readers.

    06

    Diverse Advertising Portfolio and Sectoral Trends

    Excluding election-related revenue, the company reported mid-single-digit ad revenue growth in Q3 FY25 and almost double-digit growth for the nine months. Key growth drivers for 9M FY25 included Automobile (26%), Real Estate (22%), and Jewellery (11%). However, Lifestyle (18% decline) and Entertainment & Cinema (47% decline) experienced significant setbacks, indicating a mixed performance across advertising sectors.

    07

    Capital Allocation and Shareholder Returns

    The company has maintained a strong dividend payout, with 67% of profits distributed as dividends over the nine months. Management explicitly stated that the company is not looking for any acquisitions and intends to distribute excess cash to shareholders in the form of dividends, underscoring a commitment to shareholder returns.

    This is an AI-generated summary of a publicly available earnings call transcript. It is for informational purposes only and does not constitute investment advice, a recommendation, or an endorsement. inve.money is not a SEBI-registered investment advisor. Please consult a qualified financial advisor before making any investment decisions.