Ent.Network

Entertainment Network (India) Limited reported a domestic revenue of Rs.526 crores for FY25, marking a 9.4% year-on-year growth, primarily driven by its digital and non-FCT segments. The core business, excluding digital, grew 2.6% YoY to Rs.465 crores. The company is actively transitioning from a traditional radio company to a diversified multimedia entertainment enterprise, with digital's contribution to total radio revenues increasing from 15% last year to 26% in FY25, and from 24% to 32% in Q4 FY25.

The digital segment demonstrated stellar growth, with revenue reaching Rs.61 crores in FY25, a 122% year-on-year increase, largely attributed to Gaana. Gaana's FY25 revenue was Rs.46.2 crores, significantly up from Rs.12.78 crores last year, with Q4 FY25 revenue at Rs.14.6 crores. Management highlighted a 28% increase in Gaana's subscriber base since its takeover and a successful price increase from Rs.299 to Rs.599. The company is committed to achieving profitability for Gaana within the next 5 to 6 quarters, supported by a 15% sequential drop in digital cash burn in Q4 FY25.

The non-FCT segment maintained strong momentum, growing 20% year-on-year to Rs.151 crores in FY25 and achieving a healthy EBITDA margin of 33%. This growth was primarily driven by successful solution-based initiatives and key on-ground events. Management expressed high confidence in the continued strong performance and growth of both the non-FCT and event businesses for the upcoming year, with the event business growing almost 80% in Q4 FY25.

The radio industry faced significant headwinds during Q4 FY25, exacerbated by a high base from the previous year's extraordinary government and political ad spending. Despite these challenges, the company maintained a healthy 26% volume share and over 30% value share in the radio segment. However, effective ad rates remain approximately 25% below pre-COVID levels, and volume growth saw a 4% decline year-on-year.

For Q4 FY25, EBITDA (excluding digital) stood at Rs.37.4 crores with a 27.5% margin, and PAT increased 21% year-on-year to Rs.21.4 crores. Full-year FY25 EBITDA (excluding digital) was Rs.118.8 crores with a 25.5% margin, and PAT was Rs.48.1 crores. The company maintains a strong balance sheet with a cash balance of Rs.368 crores as of March 31st, 2025. The Board recommended a dividend of Rs.2 per share, an increase from Rs.1.5 per share last year.

Management acknowledged a muted ad environment but anticipates growth in the second half of FY26 due to base effects and improving macroeconomic conditions. In the digital music space, while direct market share comparison with freemium models like YouTube and Spotify is challenging, Gaana claims a 'very healthy share' in the paid music streaming market. The company sees massive headroom for growth in the paid subscriber base, noting 200 million free music subscribers versus only 15 million paid users in India.