Concall AI

Tips Music — Q4 FY26 earnings call

Call held 23 Apr 2026

Management summary

Tips Music delivered a strong Q4 FY26, with significant YoY growth in revenue, EBITDA, and PAT, driven by its digital and catalogue performance. The company maintained a cautious yet opportunistic approach to content acquisition, while setting a 20% top-line and bottom-line growth target for FY27. Management also highlighted the substantial growth potential in the public performance market.

Highlights

Q4 FY26 Revenue grew 32% YoY to ₹103.9 crores, driven by strong performance in both digital and non-digital segments.
Operating EBITDA for Q4 FY26 increased by 106% YoY to ₹76.9 crores, reflecting significant operational leverage.
PAT for Q4 FY26 rose 93% YoY to ₹59 crores, indicating robust profitability.
For the full year FY26, revenue grew 21% to ₹375.5 crores and PAT increased 30% to ₹216.6 crores.
The company distributed a total dividend of ₹166 crores to shareholders in FY26, demonstrating strong cash generation.

Concerns

Employee costs increased 78% YoY in Q4 FY26 due to provisions for annual increments, though management clarified this is not a new run rate.
Content cost as a percentage of revenue was lower than the 18% target due to the postponement of a key movie's music release to Q1 FY27.
YouTube Shorts views declined, but management stated no material impact on revenue or upcoming deal renewal.

Key financials

3 periods

Headline

Revenue
₹103.9 Cr
YoY +32%
Operating EBITDA
₹76.9 Cr
YoY +106%
PAT
₹59 Cr
YoY +93%

Q4 FY26

Employee Cost YoY Growth
78%

FY26

Revenue
₹375.5 Cr
YoY +21%
PAT
₹216.6 Cr
YoY +30%

What they filed

Q1 FY27: revenue up 21.6%, net profit down 4.3% against the same quarter last year.

₹ Cr · quarterly

Line item	Q2 FY25	Q3 FY25	Q4 FY25	Q1 FY26	Q2 FY26	Q3 FY26	Q4 FY26	Q1 FY27
Revenue	81	78	78	88	89 +10%	94 +21%	104 +33%	107 +22%
Expenses	21	22	41	32	21	20	27	53
EBITDA	59	56	37	57	68 +15%	75 +34%	77 +108%	54 −5%
Margin	74%	72%	48%	64%	76%	79%	74%	50%
Other income	6	4	5	6	5	5	4	6
Interest	0	0	0	0	0	0	0	0
Depreciation	1	1	1	1	1	1	1	1
Profit before tax	64	59	41	62	72 +13%	79 +34%	80 +95%	58 −6%
Tax rate	25%	25%	26%	26%	26%	25%	26%	25%
Net profit	48	44	31	46	53 +10%	59 +34%	59 +90%	44 −4%
EPS	3.77	3.46	2.39	3.59	4.16	4.59	4.62	3.42

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

high confidence

Capex ₹80 Cr

I feel and our budget is more than that. I think we want to spend around INR80 crores, INR90 crores this year. We are trying for that and hopefully we will achieve that.
Returns FYTD ₹166 Cr
M&A Gujarati Kutchchi channel (Kutchchi Music) Acquisition · Closed

Acquired 4,000 songs, expanding regional music catalogue.

We have acquired one Gujarati kutchchi channel, kutchchi Music, Gujarati music and where we got 4,000 songs. So we have acquired that. ... Second quarter, let's say, somewhere in July-August.

Guidance & targets

Growth

Top-line Growth Growth · FY27 · Medium confidence 20%

For next year performance, we expect it is too early, but our target is to achieve same number 20% on top-line growth and 20% bottom-line growth. That is our target and we will try and achieve that.

— Kumar Taurani
Bottom-line Growth Growth · FY27 · Medium confidence 20%

— Kumar Taurani

Content Spend

Content Spend Content Spend · FY27 · Medium confidence ₹80-90 crores

I feel and our budget is more than that. I think we want to spend around INR80 crores, INR90 crores this year. We are trying for that and hopefully we will achieve that.

— Kumar Taurani
Content Spend as % of Top-line Content Spend · FY27 · High confidence 20-25%

Understood. So as a percent of top-line we could range somewhere between 20% to 25%? Is that the right number to work with? Yes, absolutely.

— Kumar Taurani

Market Growth

Public Performance Market CAGR Market Growth · Next 3 years · High confidence 50%+

So, we are very excited about the public performance market growing at more than 50% CAGR.

— Sushant Dalmia

Market Size

Public Performance Market Size Market Size · Next 3 years · High confidence ₹3,000 crores

Currently let's say the industry size is roughly around INR500 crores. We expect at least to grow in next 3 years at least to INR3,000 crores, purely basis on compliance.

— Sushant Dalmia

Revenue Mix

Paid Subscription Revenue as % of Digital Revenue Revenue Mix · Current · High confidence 10-15%

Raviji, paid subscription would be in the range of 10% to 15% of the digital revenue.

— Sushant Dalmia

What to watch in Q1 FY27

Content Cost as % of Revenue

Next quarter (Q1 FY27)

Current 15.8% in Q4 FY26

Target Expected to increase towards 20-25% target

Why it matters

This will indicate if content spend returns to target levels following movie postponements and its impact on profitability.

See, there is a one movie called Hai Jawani Toh Ishq Hona Hai, which was actually was supposed to release in February/March theatrical and music was supposed to release in January, that got postponed to June. So that was the hit we have, otherwise we could have reached our target.

Risks & concerns

Competitive content acquisition market and overvaluation
medium

Management is cautious about content acquisitions due to high valuations and the need to ensure quality and timely money recovery.

Management acknowledged
Decline in YouTube Shorts views
low

While YouTube Shorts views declined, management stated no material impact on revenue or the upcoming deal renewal, citing healthy underlying views.

Analyst downplayed

Q&A highlights

7 direct

Sustainability of Q4 FY26 growth and presence of one-off revenues Direct

I don't think so. Sushant, is there anything like that? Nothing Kavish, no one off is there..

Management confirmed the strong Q4 growth was organic and not due to one-off items, reinforcing the underlying business strength.

Asked by Kavish Parekh

Impact of declining YouTube Shorts views on negotiating power for deal renewal Direct

Kavish, we don't see any material impact of this declining views. And as we have said earlier, it happens in one quarter or half a year, one of the Shorts goes viral and the views increase multi-fold. But underlying whatever views currently also are there are on a healthy run rate for us. So we don't see any impact of this decline on view on our YouTube Shorts renewal deal.

Addresses a potential concern regarding a key digital revenue stream and its future prospects, with management reassuring no negative impact.

Asked by Kavish Parekh

Conservative nature of FY27 growth targets (20% top-line, 20% bottom-line) given past performance Partial

I want to achieve that target. But for the comfort of the people like you, our investors, I don't want to over-promise. So let's keep the target at present 20-20%. Let one, two quarters pass and then we will again tell you where we are moving this year.

Suggests potential for higher growth than officially guided, but management prefers a cautious approach to guidance, indicating possible future upgrades.

Asked by Rohit Singh

Reason for content cost as % of revenue falling to 15.8% from 23% last year, below 18% target Direct

See, there is a one movie called Hai Jawani Toh Ishq Hona Hai, which was actually was supposed to release in February/March theatrical and music was supposed to release in January, that got postponed to June. So that was the hit we have, otherwise we could have reached our target. And this happens in our business, sometimes content goes here and there.

Clarifies a significant shift in a key cost metric, attributing it to a movie postponement and indicating that content costs will be recognized in the next quarter.

Asked by Akshay Kolekar

What limits incremental investment in content acquisitions despite strong cash generation and shareholder returns Direct

We are really looking for more content that we should acquire. And we can convince people like you that we can have a maybe less PAT, but actually we are not getting content. I have to match the quality and the price of the content. So if I pay say tomorrow INR40 crores to some producer and acquire six-seven songs of his film and suddenly it is doing business of only INR2 crores, INR3 crores. And there is no future in that content INR38 crores, INR37 crores going directly in the drain. So with our experience in the business, we don't want to do that. It's better that we should all take dividend and we should have money to place somewhere else. So that is our main worry and we are very cautious and careful about that.

Provides deep insight into the company's disciplined capital allocation strategy for content, emphasizing quality, price, and return on investment over aggressive acquisition.

Asked by Vansh

Impact of Warner Chappell Music setting up a publishing arm in India on Tips Music Direct

It would be positive, Vishal. They are setting up a business in India, it's a huge positive for us. We won't be able to divulge more details, but it's a good positive.

Addresses a potential competitive development, with management framing it as a positive for the industry and the company, suggesting potential collaboration or market growth.

Asked by Vishal Mehta

Potential for public performance market to reach ₹10,000-20,000 crores in 5-10 years and government support Direct

No. Actually, I told you that it can happen. But that then depend upon the government support, people are taking our content. You know we have around in India 100,000 restaurants. Only 1,000 restaurants take our license. So we have to really reach that figure and it is possible, it's possible. In 10 years time we can achieve that much. UK does billion pound business every year. So you can imagine.

Highlights a significant long-term growth opportunity for the company, contingent on regulatory support and increased compliance, providing a vision for future market expansion.

Asked by Yash Maheshwari

Why Tips Music's growth (20-25%) is significantly higher than the industry average (8%) Direct

So Yash, let's say at the end of the day it all depends on the catalogue and what we have said earlier also, we have one of the best catalogue in the industry.

Explains the company's outperformance by attributing it to the strength and quality of its music catalogue, a key competitive advantage.

Asked by Yashowardhan Agarwal

3 min read 8 chapters

Detailed narrative

Strong Q4 FY26 Performance Driven by Digital and Catalogue

Tips Music reported robust Q4 FY26 results with revenue growing 32% YoY to ₹103.9 crores and PAT increasing 93% YoY to ₹59 crores. Operating EBITDA saw a significant 106% YoY growth, reaching ₹76.9 crores. This strong performance was attributed to both digital and non-digital segments, with the company's 90s repertoire performing exceptionally well across platforms, contributing to the overall growth.

FY26 Full Year Highlights and Shareholder Returns

For the full fiscal year 2026, Tips Music achieved a revenue of ₹375.5 crores, marking a 21% growth, and a PAT of ₹216.6 crores, a 30% YoY increase. The company demonstrated its commitment to shareholder returns by distributing a total dividend of ₹166 crores to its shareholders during FY26, reflecting strong cash generation and profitability.

Content Strategy and Upcoming Releases

The company released 66 new songs in Q4 FY26, comprising 47 film songs and 19 non-film songs, prioritizing quality over quantity. Two key movies, 'Hai Jawani Toh Ishq Hona Hai' and 'Main Wapas Aaunga,' with music releases on May 22nd and June 12th respectively, are slated for Q1 FY27, with their content costs to be accounted for in that quarter. Management aims to spend ₹80-90 crores on content in FY27, targeting 20-25% of top-line.

Digital Platform Engagement and Subscriber Growth

Tips Music continues to see strong engagement on digital platforms, with its YouTube subscriber base growing to 153 million. Key songs like 'Tu Jaane Hai Kahan' garnered over 10 million views, while Instagram saw catalogue songs like 'Deewana Mujhe Kar Gaya' and 'Daiya Daiya Re' achieve 3 billion and 1.5 billion views, respectively. Paid subscription revenue currently accounts for 10-15% of digital revenue, growing at a CAGR of 30-40%.

Outlook and Growth Targets for FY27

For FY27, Tips Music has set a target of 20% top-line growth and 20% bottom-line growth, which management considers a conservative estimate with potential for higher achievement. The company anticipates the public performance market, currently around ₹500 crores, to grow to ₹3,000 crores in the next three years at a CAGR exceeding 50%, driven by increased compliance and online licensing.

Capital Allocation and Content Acquisition Philosophy

While the company has strong cash generation, it maintains a cautious approach to content acquisitions due to the competitive and potentially overvalued market. Management prioritizes projects that offer a clear path to money recovery and fit their quality and price criteria, opting for dividends or alternative investments if suitable content is not found. The company acquired a Gujarati music channel with 4,000 songs in Q2 FY26.

Employee Costs and Operational Efficiency

Employee benefit expenses in Q4 FY26 increased by 78% YoY due to provisions for annual increments. Management clarified that this is a one-time Q4 adjustment and not indicative of a new run rate. The overall employee count has reduced from 105 to 98, suggesting underlying operational efficiency and a focus on managing costs effectively.

Digital Revenue Mix and Subscription Trends

Digital revenue constituted approximately 70% of the total revenue for FY26. Paid subscription revenue currently accounts for 10-15% of digital revenue, up from 10-12% last year, and is growing at a CAGR of 30-40%. Management noted that while YouTube Shorts views declined, the growth in long video content continues to drive digital revenue, ensuring a healthy underlying performance.

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

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