Mumbai: Entertainment Network India Ltd., India’s top operator of radio stations, is exploring markets like the Middle East and U.S. for growth as a slowing economy and the coronavirus pandemic dents prospects at home.
Enil, which runs 73 FM stations under the ‘Mirchi’ brand, has won a radio license from Bahrain’s information ministry, Chief Executive Officer Prashant Panday said on an earnings call this week. For the year ended March, the company earned $1 million in revenue from its U.S. app, which mainly plays Bollywood music in New York and New Jersey.
“We will be able to launch Mirchi in Bahrain and operate for five years,” Panday said. It would be cheaper than operating in India as the government doesn’t require a license fee and provides studio facilities, he added.
Enil aims to cut costs by 40% in the financial year started April 1 — including reduced salary and jobs — to improve margins as a slowing economy hurts advertising revenue. Its shares have lost 37% in 2020, set for a fourth straight annual decline.
“Covid-19 is having a savage impact,” analysts Yogesh Kirve and Sidhant Mattha at Mumbai-based B&K Securities Ltd. wrote in a note. They have a hold rating on the stock and expect Enil to just about break even next year.
Bennett Coleman and Company Ltd., the owner of the Times of India group of publications, holds a 71.2% stake in Enil. Panday said advertisements by India’s federal government have dried in the past year, which is one of the reasons radio stations are seeing a bigger decline in advertising volumes compared with television.- Bloomberg
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