Key takeaways of the company

The present market conditions continue to be challenging on the back of weak consumer demand and a general economic slowdown. However, the innovative knowledge-driven product strategies and well implemented circulation expansion drive is yielding results.

Dainik Bhaskar newspaper DB works to gain market share in Bihar, Gujarat, Rajasthan and Punjab besides maintaining dominance in remaining markets. According to latest readership survey, DB has strengthened its readership base in Bihar by adding 1.82 lakh readers, Similarly in Rajasthan, DB has increased its lead in Urban Rajasthan to 10% from 4% in last quarter and in Jaipur to 47% from 37% in the previous quarter. In Gujarat DB's lead has widened to 30% against earlier 19% lead in key market of Ahmedabad.

On the revenue front, growth continues to be challenging for the industry, however, softening newsprint prices is a silver lining. This coupled with cost-rationalization measures has enabled it to improve profit margins.

The advertisement revenue both print and radio together was down by 12%yoy to Rs 425 crore in Q3FY20 and down 9%yoy to Rs 1233.8 crore in 9mFY20. Q3FY19 had the benefit of election in the states of MP, Chhattisgarh and Rajasthan in Q3FY19.

Circulation revenue was up by 2%yoy to Rs 132.1 crore in Q3FY20 and down 1% to Rs 392.1 crore in 9mFY20. The growth in circulation revenue for Q3FY20 was largely due to increase in cover price in select markets especially Madhya Pradesh rather than increase in circulation volume. The circulation volume for the quarter was maintained or almost equal at about 56.4 lakh copies in Q3FY20compared to 56.58 lakh copies in Q3FY19.

Increase in cover price in MP is to the tune of about Rs 6-8 per month.

The newsprint prices in Q3FY20 at Rs 38158/ MT was down by 16%yoy from RS 45390/MT in corresponding previous period. Softening trend in newsprint prices are expected to continue in Q4FY20 as well.

The company expects the news print price in Q4FY20 to go down by atleast 3% from Q3FY20 number.

Radio stations are operating on 60% inventory. If lifestyle and auto comes back there will be strong growth. The focus is on combination of local and national. The company is working on lifestyle and auto to come back to radio with the company is working on certain product where these players will get value.

The earlier GOI permission of taking news from AIR is not working for FM radios and the players has to be allowed to create and experiment their own news content.

In 9mFY20 – The share of government in advertisement revenue is about 18%. Education, automobile, real estate and governments roughly about 65%. While advertisement revenue on overall basis was down by 9%, the print advt revenue was down by 7%. Government advertisement revenue was down by 15%, automobile advt revenue was down by 8-10%. While Education has maintained, surprisingly the real estate category stayed flat.

Government advertisement especially the Central Government advertisement has come down sharply. While the state government advertisements have stayed on the drag of government advertisement happed due to sharp fall in Central Government advertisement. Sharp fall in Central Government advertisement is largely due to absence of any new schemes, which the government wants to promote. So the fall in central government advertisement pie is largely due to lack of reason to exhaust the advertisement budget and not on account of any diversion of revenue to other medium considering the fall in government advertisement in Radio and Television. Overall government advertisement revenue is down by 15% in 9mFY20.

Radio - If DIPP advt is removed the fall is in low double digit.

Some relief measure announcement is expected as far as newsprint duty is concerned in coming Union Budget. The government has been meeting stakeholders from the industry and hope that these interactions manifest in support in the upcoming budget.

Dainik Bhaskar newspaper continues to garner market share in its newer markets while maintaining leadership position in its existing markets. Further, the company is proud that Dainik Bhaskar is the only Indian news daily to feature amongst the world's top 3 most circulated newspapers, in 2019, as per WAN IFRA.

Going forward, the company is optimistic about revival in consumer spending and better revenue scenario.

Consumer-centric focus of the company coupled with strong on-ground execution enabled it to build a position of strength that will help it to capitalise on forthcoming opportunities.

The company is striving hard to improve circulation in crucial markets.

The mix between corporate and retail in advertisement revenue is about 65:35. While the central government is clubbed with corporate, the state government advertisement was clubbed with retail.