‘M&E sector to see 27% revenue growth in FY22’

THE PRINT SEGMENT, WHICH CONTRIBUTES A FIFTH OF THE M&E SECTOR TOPLINE, IS RECOVERING, THOUGH AT A MUCH SLOWER PACE

NEW DELHI: Indian media and entertainment (M&E) sector is expected to witness a strong 27% growth in revenue to around ₹1.37 lakh crore in 2021-22, after contracting 26% this fiscal, according to ratings agency Crisil. Segments such as digital and television (TV) will have relatively shorter time to bounceback to pre-pandemic levels while print, films, outdoor, and radio would take longer.

Crisil Ratings Ltd director Nitesh Jain said advertisement and subscription revenues contribute nearly equally to the overall M&E sector’s topline, but since the former correlates strongly with economic growth, the pandemic has had a bigger impact on it. “Next fiscal, with strong economic rebound on the cards, ad revenue should grow 31% year-on-year and subscription revenue around 24%,” Jain added.

The TV segment—contributing around half of the sector’s topline—has recovered fully and will report healthy growth next fiscal. Ad revenue saw a sharp contraction initially, but recovered swiftly thereafter, aided by airing of new content, sports events such as the Indian Premier League and a buoyant festive season, Crisil Ratings Ltd said in a statement.

“As for subscriptions, TV was resilient even during the peak of pandemic as people remained indoors,” it added.

The print segment, which contributes a fifth of the M&E sector topline, is recovering, though at a much slower pace, and should be able to rebound fully only by the end of next fiscal, it added.

“Print is losing share in ad revenue mainly to the digital segment. Circulation too, especially for English language, could see a loss of 8-10%, because of increased preference for e-papers in metros. However, print companies are rebooting their cost structure and accelerating digital adoption to stay relevant,” the ratings agency added.

Stating that digital has emerged as the medium of choice, Crisil Ratings Ltd Associate Director Rakshit Kachhal said the pandemic accelerated adoption of over-the-top (OTT) platforms, online gaming, e-commerce, e-learning, e-papers and online news platforms. “This has meant the focus of advertisers has shifted from traditional to digital media. We expect the digital segment revenue to grow 14-16% annually over the medium term. Its share of M&E sector revenue is expected to double to around 20 per cent by fiscal 2024 compared with last fiscal,” Kachhal added.