Concall AI

Radiowalla Network Limited — Q2 FY26 earnings call

Call held 12 Nov 2025

Management summary

Radiowalla Network Limited reported a stable H1 FY26 with total income of INR10.39 crores, driven by a 20% YoY growth in advertising revenue. Profit after tax, excluding ESOP costs, surged over 50% YoY. The company expanded its in-store audio network, digital signage, and DOH verticals, and is progressing with international expansion, including a Dubai subsidiary. Management expects strong H2 growth and aims for over 10% net margin within two years.

Highlights

Total income for H1 FY26 was INR10.39 crores, reflecting stability amidst industry headwinds.
Advertising revenue grew by an impressive 20% year-on-year, highlighting strong traction in audio advertising and in-store engagement platforms.
Profit after tax (excluding notional ESOP cost) grew by over 50% year-on-year, demonstrating underlying business strength and execution capabilities.
Expanded in-store audio network by adding nearly 2,000 new stores and onboarding 74 new brands.
Advanced international presence with plans to establish a subsidiary in Dubai before December end, and successful entry into Africa.

Concerns

Experienced temporary disruption in the advertising ecosystem due to GST-related changes, impacting H1 growth.
A notional ESOP cost of INR17-18 lakhs impacted the P&L in H1 FY26, which was not present in the previous year.
Identified potential risk from competitors 'undercutting in terms of pricing' in the market.

Key financials

01 Total Income ₹10.39 Cr
02 Advertising Revenue Growth 20% +20%YoY
03 PAT Growth (ex-ESOP) 50% +50%YoY
04 ESOP Cost Hit ₹0.175 Cr

What they filed

Q2 FY26: revenue up 36.3%, net profit down 57.9% against the same quarter last year.

₹ Cr · quarterly

Line item	Q4 FY23	Q2 FY24	Q4 FY24	Q2 FY25	Q4 FY25	Q2 FY26
Revenue	8	7	8	10	11 +39%	10 +36%
Expenses	7	6	7	9	10	9
EBITDA	0	1	1	1	1 +229%	1 −40%
Margin	4%	17%	10%	8%	9%	7%
Other income	0	0	0	0	0	0
Interest	0	0	0	0	0	0
Depreciation	0	0	0	0	0	0
Profit before tax	0	1	1	1	1 +2550%	1 −40%
Tax rate	150%	0%	-13%	34%	68%	32%
Net profit	-0	1	1	0	0 +1800%	0 −58%
EPS	-0.47	22.54	1.16	0.50	0.48	0.57

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.

Capital allocation

medium confidence

Capex Capex disclosed
- Digital screens for retail stores
- Technology tools development
Our majority of the capex would come into a form of digital screens, which we need to install in the retail stores and on the technology tools which we are building up.
M&A Dubai Subsidiary Acquisition · Announced

To expand further when you have a local player, target more clients, and upsell additional services in the Middle East and Africa regions.

We have already informed the exchange that we are opening up the subsidiary. So, as I said, the paperwork is on. So, we should be setting it up within the next 45 days or so.

Guidance & targets

Profitability

Net Margin Profitability · next two years or so · Medium confidence north of 10%

We have to be at a net margin level. We should be north of 10% in the next two years or so.

— Harvinderjit Singh Bhatia

Revenue

International Revenue Contribution Revenue · next 12 to 18 months · Medium confidence 15% to 20%

As we expand our international operations, I expect it to be maybe in the range of 15% to 20% in the next 12 to 18 months kind of thing.

— Harvinderjit Singh Bhatia

Capacity

Digital Signage Screens Managed Capacity · by '27 · High confidence 5,000-plus

Well, we are on track to get to that number within -- by '27, definitely.

— Harvinderjit Singh Bhatia

Expansion

Dubai Subsidiary Operationalization Expansion · before December end · High confidence opened

No, no. It will be opened up before December end. ... So, we should be setting it up within the next 45 days or so.

— Harvinderjit Singh Bhatia

What to watch in Q3 FY26

Dubai Subsidiary Operationalization

before December end

Current Paperwork in progress

Target Opened and operational

Why it matters

Successful establishment of the Dubai subsidiary is key for international expansion and client acquisition in the Middle East and Africa.

No, no. It will be opened up before December end. ... So, we should be setting it up within the next 45 days or so.

Risks & concerns

Temporary disruption in advertising ecosystem
medium

Due to GST-related changes, leading to brands holding back expenses in September.

Management acknowledged
Competitive pricing / Undercutting by competitors
medium

The biggest risk is competitors undercutting on pricing, but Radiowalla mitigates this by offering combined audio and digital services and superior service standards.

Management acknowledged
Impact of notional ESOP cost on P&L
low

A notional ESOP cost of INR17-18 lakhs hit the P&L in H1 FY26, which was an accounting timing issue not present in the prior year.

Management acknowledged

Q&A highlights

8 direct

Other current assets and cash flow impact Direct

So, primarily, we have, you know, GST and income tax are related, you know, credits which are there, which are part of the current assets as well. And the second question you had asked about was cash flow? ... Yes, as I said, one is on the income tax credit, tax credit, what we have as well, which gets accumulated at our end. And other than that, we have some advances to our vendors, which are there.

Clarified the nature of a significant line item (INR4 crores) in the balance sheet and its increase in cash flow.

Asked by Sanket Gupta

H2 growth recovery post GST impact Direct

Definitely, I'll request Harpreet to add-on. But we are very confident because in our business, typically H2 is much higher than H1 revenue being in Media business because it's all festive season starting from October, November. We'll see that more and more brands are spending.

Provided confidence in H2 performance, attributing it to the festive season and a return to normal ad spending after GST-related disruptions.

Asked by Sanket Gupta

Plan for margin improvement and net margin target Direct

So, margins will definitely improve because even today, if you see our cost segment, our major cost is primarily employee cost because that's where the business is all being given by. We have a specialist music team, technology team, backend ops. So, now we are investing in further AI and tech tools to automate the processes at the backend, which means that we don't have to hire more people now as the business expands. ... We have to be at a net margin level. We should be north of 10% in the next two years or so.

Outlined the strategy for margin expansion through automation and set a specific net margin target for the medium term.

Asked by Parth Doshi

Rationale for establishing a subsidiary in Dubai Direct

So we have been doing business with some clients in the Middle East for some time. But what we have noticed is that this being a local company over there has many advantages as compared to working with the overseas companies. ... it also gives an opportunity to expand further when you have a local player. ... Middle East or Dubai region is kind of the gateway for a lot of companies which have operations in Africa.

Explained the strategic benefits of a local presence in Dubai for client acquisition, upsell opportunities, and expansion into the broader African market.

Asked by Parth Doshi

Monetization strategy for in-store radio and scaling Direct

So, as you know, our business primarily concerns from or originates primarily from in-store Radio services, wherein -- which means as we add on more clients, they pay us per month per store as subscription fee. So, that's for the audio services. And now, for the same clients, we are upselling other services like digital screens, where again, they pay us for the content management on a monthly subscription basis. ... we generate ad revenue as well from the stores.

Detailed the multi-pronged monetization model for in-store radio, including subscription, upselling digital services, and third-party advertising.

Asked by Jatin Shah

Plan to reach 5,000+ digital signage screens Direct

Yes. Our majority of the capex would come into a form of digital screens, which we need to install in the retail stores and on the technology tools which we are building up. ... Well, we are on track to get to that number within -- by '27, definitely.

Confirmed the company's commitment and progress towards a significant expansion target for its digital signage network.

Asked by Mayuri Shah

Biggest risks to the business Direct

Yes. Like any other business, the biggest risks are in terms of somebody else undercutting in terms of pricing. However, what we are trying to do is to establish service standards which are superior and which can compete on the price terms. ... we mitigate it when we are combining audio services and digital services together for the client. There is no other company which is in India, which is providing these set of services.

Identified competitive pricing as a key risk and explained the company's strategy to mitigate it through integrated service offerings and superior standards.

Asked by Mayuri Shah

AI-generated music library and client experience Direct

Now, there are instances where clients require customized sounds for their brands. ... So we use Al tools to create music which is kind of customized or which is within specific genres. It is used to enhance our existing library of music, right. ... it offers us a lot of flexibility in terms of catering to client requirements or catering to clients who have very specialized requirements. And at the same time it gives clients the flexibility to choose from a much larger variety of music which will play in their locations.

Explained how AI is being leveraged to enhance content customization and expand the music library, improving client satisfaction and service flexibility.

Asked by Jatin Shah

2 min read 5 chapters

Detailed narrative

H1 FY26 Performance Overview

Radiowalla Network Limited reported a total income of INR10.39 crores for H1 FY26, demonstrating stability despite a challenging macro environment and temporary disruption from GST-related changes. Advertising revenue showed robust growth of 20% year-on-year. Excluding a notional ESOP cost of INR17-18 lakhs, profit after tax grew by over 50% year-on-year, reinforcing the underlying strength of the business model.

Strategic Expansion: In-store Network and International Markets

The company continued its strategic expansion by adding nearly 2,000 new stores and onboarding 74 brands to its in-store audio network. Internationally, Radiowalla made notable progress, expanding its presence in Africa and advancing plans to establish a subsidiary in Dubai, which is expected to be operational before December end. This local presence is anticipated to enhance client acquisition and upsell opportunities in the Middle East and Africa.

Profitability and Margin Improvement Focus

Management is focused on improving profitability, targeting a net margin of 'north of 10%' within the next two years. This improvement is expected to be driven by operational discipline, cost optimization, and investment in AI and technology tools to automate backend processes, reducing reliance on hiring more people as the business scales. The company noted that margins have already improved, but the notional ESOP cost impacted the reported P&L for H1 FY26.

Digital Signage and DOH Verticals Momentum

The digital signage and Digital Out-of-Home (DOH) verticals gained further momentum, with over 800 screens now under content management and 15 digital hoardings operational across key states like Gujarat and UP. The company is on track to achieve its goal of managing 5,000-plus digital signage screens by FY27, with capex primarily directed towards installing these screens and developing technology tools.

Restaurant Segment Strategy and AI Music Library

Radiowalla is actively targeting the restaurant category, beyond large chains, by partnering with FHRAI and developing a platform to automate music duration, expected to launch in H2. The company is also leveraging AI tools to create customized music, enhancing its existing library and offering greater flexibility to clients with specialized requirements. This AI-generated music library is a win-win for both customers and the company, providing a larger variety of music options.

This is an AI-generated summary of a publicly available earnings call transcript.

View original transcript