Ladies and gentlemen, good day, and welcome to Entertainment India Network Limited Q1 FY 2027 earnings call. As a reminder, all participant lines will be in listen-only mode, and there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during this conference call, please signal an operator by pressing star then zero on your touchtone phone. Please note that this conference is being recorded. I now hand the call over to Ms. Sneha Salian from EY Investor Relations. Thank you, and over to you, ma'am.
Thank you, Atharva. A warm welcome to all the participants to the Entertainment Network India Limited Q1 FY 2027 earnings call. The investor presentation and the financial results are available on the company's website and on the stock exchanges. Please note, anything said on this call, which reflects our outlook for the future, or which can be construed as a forward-looking statement, must be viewed in conjunction with the risks that the company faces.
This conference call is being recorded, and the transcript, along with the order of the same, will be made available on the website of the company as well as on the exchanges. Please also note that the audio of the conference call is a copyright material of Entertainment Network India Limited, and it cannot be copied, rebroadcasted, or attributed in press or media without specific and written consent of the company. To give you a brief business update and to take you through the results from the management team, we have Mr. Yatish Mehrishi, Chief Executive Officer, and Mr. Sanjay Ballabh, Chief Financial Officer. I would now request Mr. Yatish to provide you with a brief update on the quarter. Over to you, sir.
Thanks, Sneha. Good morning, everyone. On behalf of ENIL, I extend a very warm welcome to all participants joining us for our Q1 FY 2027 earnings call. We announced our results yesterday, and I hope you had a chance to review them. I will now take this opportunity to walk you through our performance. During the quarter, we recorded domestic revenue of INR 111 crores, marginal degrowth of 1.9% year-on-year. Performance was affected by the geopolitical conflict and related uncertainties, which led to our event cancellations, curtailed travel activities of artists, and consequently lower business volume during the quarter. EBITDA for the quarter grew by 42% to INR 8.7 crores. This was achieved through the successful execution of several strategic cost rationalization measures we have undertaken during the year.
Encouraging to note that despite prevailing macro headwinds, the non-digital business improved profitability, delivering EBITDA growth of 7.4% and PAT growth of 85% during the quarter. Our international operations, though impacted by the West Asia conflict, contributed INR 3 crores in revenue. The company continues to maintain a robust balance sheet with a cash balance of INR 389 crores as of June 30, 2026. Turning now on the performance of our key segments. Let me start with radio. The Radio City advertising segment delivered reported revenues of INR 62.2 crores on the back of ongoing macroeconomic scenario.
The challenging conditions witnessed in FY 2026 extended into Q1 FY 2027, with advertiser demand remaining soft due to the uncertainties. This is affecting not only radio segment, but the overall media industry. Despite the headwinds, we maintain our leadership position, showing resilience of our business model. Coming to our non-RCT segment. The non-RCT segment stood at INR 17.5 crores, impacted by event cancellations and artist travel disruptions across markets weighed on our business activity.
Moving to our digital business. In this quarter, digital revenue stood at INR 31.1 crores, up 43.3% year-on-year, contributing to 30.2% of our total revenue, up from last year of 23%. This growth was largely powered by Gaana's strong user traction and consumer engagement on the platform. I am happy to report that investment in digital business declined to INR 8.3 crores from INR 9.8 crores in the same quarter last year, reflecting the results of our ongoing operational efforts. We have been reiterating that digital business will be the key driver of our growth, and Q1 FY 2027 results were yet another quarter to showcase exactly the same. With this, I will hand over the call to the moderator and look forward to your questions. Thank you.
Thank you very much. We will now begin with the question-and-answer session. Anyone who wishes to ask a question may press star and one on their touchtone phone. If you wish to remove yourself from the questions queue, you may press star and two. Participants are requested to use handsets while asking a question. Ladies and gentlemen, we wait for a moment while the questions queue assembles. The first question comes from the line of Suresh from Burmans Financials . Please go ahead.
Hello? Hello?
Please go ahead.
Good morning, sir. Thank you for the opportunity. Sir, actually, so many quarters in our radio business will suffer from advertising. Is it only for West Asia issues reasons or any other issues? My second question, you will search for radio and digital business. You go for any other ventures and revise your company and go for any other businesses. You try to any other businesses, sir.
Okay, Suresh. Thank you, Suresh. See on overall, yes, the West Asia crisis and overall economy situation did have an impact on media. Media, as I have been telling in other earnings calls also, is going through a major transition phase where the subscription numbers or advertising revenues are under pressure, where there is a lot of content available. There is media fragmentation happening and which is leading to pressure on overall the advertising landscape.
It is not just radio, but be it television, be it print, be it outdoor, all forms of mainline advertising are under pressure. In addition to that, with the geopolitical crisis and uncertainties lead to a much bigger impact. That is the reason the radio degrowth you are seeing across the board, not just us, but I would say across traditional mediums, there has been a softness in the industry.
To your second question, we have three businesses we put as verticals. One is radio, the second is digital, which you rightly said. The third is our event business which has been growing really quarter on quarter every quarter. This quarter has been marred by a lot of cancellations because of artists couldn't travel. We had to cancel a couple of activities due to the uncertainties, and that is the reason we have not been able to do that. Otherwise, our three major businesses remain radio, events, and digital.
Okay, sir. Actually, this business verticals, all verticals will be some media side. It is not good for growth. Any other you will try to, any other diversification you can, any planning?
Suresh, so far we have concentrated on the media business, but with new tech of AI and all, we do delve on that and we keep experimenting on and do internal investments on usage of AI. But largely our overall sector will remain media.
Only for media. You will go for media. Okay. Actually, I am the long shareholder in entertainment network. Investor-wise, you will not grow any company. Sir, any buyback you can plan? The cash is available in the company registers. Any buyback plan you can tell?
That's a board discussion. We keep discussing. As and when it comes, I think we'll come back.
You can take feedback.
Yes, Suresh.
Yes. Bye bye.
Yeah.
Okay. Thank you.
Thank you, Suresh.
Thanks.
Thank you. Ladies and gentlemen, before we take the next question, a reminder to all the participants. To ask a question, please press star and one. I repeat. To ask a question, please press star and one. The next question comes from the line of Ronak Shah from Equirus Securities. Please go ahead.
Yeah, thanks for the opportunity. My first question is on the point you highlighted about the event business, that there are a few cancellations. Is there a possibility to roll over those business into the quarter or the event got canceled is a permanent dent kind of thing? I am just asking from a one-off order, it bumped into the events revenue from the subsequent quarters.
Ronak, what happens is you are right. A couple of times, such a few events get canceled because they are strategic to that quarter. But for us, a couple of events have moved to the quarter two. There are a couple of international artist concerts we wanted to do which are happening in quarter two. But largely sometimes it does happen, that the events are planned for that month, and if that gets canceled, then you lose the event.
Having said that, event business has always been H2 heavy. Q1 and Q2 are always subdued. Other than media is like 45, 55, H1, H2, events is almost 35, 65, if not more. That is the way it looks like. We remain very positive on our event business and we believe our quarter two onwards, the business will remain in good shape only.
Understood. Secondly, from the buyer perspective, we have increased our subscription pack. Now what percentage of our subscribers are on that pack? Have we seen some dip just because of the increase into the subscription price?
Yeah. Overall, it remains healthy. As I said, we have always been very prudent about looking at profitable subscribers and not just gun for subscriber growth. The overall thing for us has always been to look at profitable growth. The way we look at the profitable margin subscribers is about 70% now for us. There were a little low-end subscribers, which we keep churning out and keep a balance of subscriber numbers and profitability.
Okay. Directionally, though not a specific number, how you are likely to see FY 2027 shaping up, both in terms of your radio plus non-ad city business? From the profitability front, how the trajectory will look like?
We believe this year, the traditional mediums of radio, TV, print will remain subdued, the pure radio advertising. Even business will grow exponentially as been growing across the board, and we continue to be bullish about it. To compensate and to work on our radio muted growth or traditional media growth, we have taken certain very strong corrective actions on our operational cost models. You have seen some results in quarter one. It will flow into all quarters over a period of time. We've just over last one quarter and little more, we have started taking those actions, which will flow into the entire year also. The whole idea is to look at the broadcast model, starting afresh, and see how we can look at operating costs are really efficient about it.
Okay. Can you elaborate on that part? Because one of your peer also highlighted they have restructured the operating cost model and the numbers are quite visible in their profitability. Which are the line of item which we are looking in terms of the cost saving or what can be the quantum of the saving which we can expect?
I will not be able to put you the number to it right now, but to give a perspective, yes, there are networking of stations, usage of new tech of AI, usage of new broadcasting tools, helps us minimize the cost of broadcasting really drastically. That helps a lot. Which impacts line items across the cost base. You know, radio has always been a fixed cost model, so earlier it was difficult, but with new tech available and networking, it helps us to look at line items across cost structures to make it more efficient. You would have seen even quarter one for us, even with the subdued revenue, the profitability has improved over last few terms. As I said, it is just a quarter we believe, over a full year it will be much better.
Understood. On the profitability front, any directional thing which you can highlight compared to FY 2026 or based on the current trend date?
Generally, Ronak, we do not provide any guidance on this.
Correct.
I will leave that to it right now for that.
No issues. That's it from my side. Thank you.
Thank you.
Thank you. A reminder to all the participants, to ask a question, please press star and one. I repeat, to ask a question, please press star and one. The next question comes from the line of Tanushi, an individual investor. Please go ahead.
Good morning, sir. I have few questions I would like to ask. Could you share only Gaana revenue and profitability for this quarter and YoY growth?
Gaana revenues have been, just give me one sec. For INR 21.4 crore against last year of INR 17.5 crore, with a growth of almost 19%.
Okay. What was the SCT and non-SCT split for this quarter?
Percentage would be, as I said, we are now digital is about 30%. It is almost equal for us in terms of 45% radio, 30% digital and balance is non-SCT.
Okay. Can you share the details on the inventory utilization?
Inventory utilization has gone down by about 8%, but the price has improved by almost 5%.
Okay. What was the volume growth that you have achieved in this quarter?
I said the volume utilization has gone down by 8%, ma'am.
Okay. What was the effective rate?
We don't disclose the rate, but as I said, the rates have improved by about 5%.
Okay. What was the overall market share?
Market share on volume has been about 26%-27%.
Okay, sir. Thank you.
Thank you. The next question comes from the line of Chandramouli Jagannathan , an individual investor. Please go ahead.
You said that the Gaana revenue is about INR 21 crores. What is the EBITDA? What is the profitability? What is the plan in the future, and when it comes to Gaana?
Chandramouli, can you just repeat? Your voice was a little feeble. I could not gather everything.
I am asking about Gaana. You said that the quarterly revenue run rate is about INR 21 crores.
Yeah.
What is the EBITDA and what is the plan for the future, sir? How is it shaping up?
So, if you look at.
What is the plan going forward?
Our revenues on Gaana have gone up by 20%. The losses have reduced by about 14% compared to last year. Last year, our losses were about INR 9.8 crore. This year it has gone INR 8.35. Our endeavor is to make it profitable this year on Gaana to get it breakeven. There are certain headwinds and certain issues which keeps coming on from the market sides, which we keep fighting it out type of stuff. But right now, the endeavor is to get it breakeven stage as soon as possible. We have been consistent on reducing our investment on digital quarter on quarter.
Hypothetically speaking, assuming that the Gaana breakeven, what would be the profitability of the whole business, sir?
Can you repeat?
No. Hypothetically, the question is, assuming that Gaana breaks even overall, what would be the profit from the other business?
Our radio margins have always been in the range of 30%, 35% to 40%. Events have been in the range of 25% to 10% EBITDA margins. You can look at in those lines as the profitability margin numbers.
You are saying that Gaana can be EBITDA positive year-end. That means from the INR 8.3, to make it EBITDA positive, the top line has to go 35%, 30% growth, right? Am I right? Is my understanding.
It is a mix of both. What happens is in Gaana, because the subscribers are at different price points, it is not like a telecom structure where you change price for everybody. Your price keeps changing because the customer has committed a price. When he turns out to a new price, it improves your top line also. It is a function of both. The important part is to look at revenue growth. We have increased our price to INR 799, and it is a balance what we keep creating. As I said, our endeavor for us is to make it break even as soon as possible and not gun for unnecessary subscriber growth, which comes at a lower cost or a lower LTV.
Okay. This is happening as per your plan?
Yeah, it is happening as per plan. There can be a couple of quarters here and there because everybody is looking at the same consumer. Sometimes the CAC goes up, so you have to balance it out. As you see in the market today, there are short-form dramas. Gaining a stop, but everybody is trying to acquire the similar customer. There are 100 million or 150 million Indians who are the main subscriber market, or even in music, if you look at, there are 150 million people who stream music.
If those are the people everybody is gunning for, sometimes your CAC goes up, and that puts pressure on your marketing spend. You have to keep a balance on it. That what we keep. Maybe sometimes it could be one quarter here and there, but the endeavor is to keep reducing our investment and make it break even as soon as possible and that is what we have been achieving quarter on quarter to reduce it.
The earlier person also alluded, maybe you have a cash balance of about INR 390 crores. Maybe instead of a dividend, maybe you can think of giving a buyback because it is tax-effective now. Maybe at a promoter level also, it is taxless for you. It is my humble request to you.
No, I take your feedback. Normally, it is a board discussion we keep discussing. We also keep evaluating strategic initiatives.
Because your market cap of the company is only about INR 500 crore right now, so maybe you can consider.
Yes, I will take your feedback.
Yeah.
Thank you.
Thank you. That is all from me.
Thank you.
Thank you. Ladies and gentlemen, if you wish to ask a question, please press star and one. I repeat, to ask a question, please press star and one. The next question comes from the line of Ronak Shah from Equirus Securities. Please go ahead.
Yeah, thanks for the follow-up. Sir, my question is on Gaana again. We have seen some good double-digit sort of subscription paper at industry level, just because two things. First, the competitors have tweaking the pricing, and secondly, just because of the macro headwinds, have we seen some moderation to the industry-level subscriber growth in last four months? Secondly, from the competitive pricing perspective, if we see the scheduling, how are we likely to position ourselves compared to the current pricing?
Okay. So, see, Ronak, let me answer one by one. The pricing front, we still have a headroom compared to our competitors on an annual pack. But on a monthly pack, we are almost at the similar levels. Almost at similar levels, like we would be at about 10% lower than competition. But important point, when you look at the subscription market, we are the only subscription service, a pure subscription service available in the country.
Rather other services have free medium also and a premium. So they are largely freemium. We are only a premium model. Having said that, if you have looked at certain reports and lot of labels have also started looking at subscription is the way to go. If you look at Amazon Music has relaunched, has also put a price on subscription and looking at a pure subscription service also.
Spotify has globally also two days back, they have also announced in terms of putting restrictions on free model and looking at subscription. In fact, the biggest initiative has come from Universal as a label, where they have recently announced that their new music for 72 hours, first 72 hours will be only available to premium subscribers. So the entire industry and all streaming players believe that for music industry to grow, it is only way is going to be through subscription, which we have been doing for last two years. We believe on subscription economy only, and that's what we continue to believe. As I say, I've always been saying it's a willingness to pay for music rather than ability to pay.
Since it's available free sometimes, Indians are always value-conscious consumers, it takes time to change the behavior. But over a period of time, if you look at EY, KPMG reports, EY report or a KPMG report, the numbers have been very heartening. They've been growing, and we have also grown our subscriber numbers in line with that. It's a slow burn, but it has a bright future in terms of moving towards subscription. In the past also, people have paid for music. It's just that in the middle of last 10 years, music has been available free, and that's the reason people are not putting value to it. But as people start putting restrictions on the free tier, people will look into a behavior change of moving to a music subscription also.
Got it. That is from my side. Thanks.
Thanks, Ronak.
Thank you. A reminder to all the participants, to ask a question, please press star and one. I repeat, to ask a question, please press star and one. The next question comes from the line of Suresh Baramsetti from Burmans Financials. Please go ahead.
Yes, sir. Sir, once again, you give the opportunity. Thank you, sir. Sir, actually, ENIL, Entertainment Network YouTube channel is available, sir?
Yes.
Sir, you have these programs in generally health awareness, organic food side. Some events you have taken, that type of OTT, YouTube channel, Instagram. That type of events you can increase the market share. I will just suggest it, sir. I know little bit, but I will suggest it.
No, thank you. Thank you, Suresh, for the feedback. To give you a perspective, we do a lot of events on the health side also. We do a lot of marathons across the board and also on sustainability, also, we do a lot of events. So it is not just on entertainment side, but on the health and sustainability side also, we do a lot of events. We almost do 25 to 30 marathons in a year. We do tree plantation drives across the boards. So a lot of activities we do which are non-entertainment also, depending on how the opportunities lie.
Okay, sir. Thank you.
Thank you, Suresh.
Thank you.
Thank you. Participants who wish to ask a question, may press star and one. I repeat, participants who wish to ask a question, may press star and one. As there are no further questions, I would now like to hand the conference over to the management for closing comments. Thank you, and over to you.
Thank you. Thank you, ladies and gentlemen. It's a pleasure to have you all. We remain committed to driving our profitable growth and creating long-term value for our shareholders. Thank you once again for joining this call. Have a good day.
Thank you. On behalf of Entertainment Network India Limited, that concludes this conference. Thank you for joining us, and you may now disconnect your lines.