Highlights of the call

• The Consolidated debt of the Company stood at Rs 195 crore which was entirely in the Radio business. The interest cost for FY09 would be about Rs 9 crore.

• Cash in books stood at Rs 40 crore in OOH business and Rs 85 crore in Radio business.

• The marketing costs will remain stable going forward.

• The radio business grew 35% at Rs 225.22 crore for FY08, which was inline with the expectations of the Company. The Private FM sector grew by 55% in FY08 to a size of Rs 500-510 crore with the overall Radio market at Rs 700 crore. As per the company, the share of Radio in the advertising industry grew to 4% from 3% last year and the Company expects it to increase to 7-8% in the next 3-4 years.

• The market share of "Radio Mirchi" was at 47-48% against 49-50% in the last year thereby maintaining its share.

• For FY08, the EBITDA of the legacy 10 stations improved to 31% from 27% in the last year. The new stations (22 new stations launched in FY’08) performed better than expectations in Q4FY08 reporting revenues of Rs 16 crore with EBITDA of 6%.

• As per listenership data of RAM, Radio Mirchi is the overall leader in the Metros i.e. Delhi, Mumbai and Bangalore. In Delhi, Radio Mirchi leads by 50% over its competitor and in Bangalore, it leads by 60-65% whereas in Mumbai, it is second but the difference is insignificant.

• The utilization in Metro for Q4FY08 was 85% against 85-100% in Q3FY08. For all 32 stations taken together, the utilization stood at 33%.

• In February – March 2008, the Company took a raise in pricing which hit its volumes. There would be some softness in volumes in April and May as well but it will increase from June onwards.

• In metro, the pricing was at the same level or 5% lower in Q4FY08 as compared to Q4FY07. The management believes that the bottom is hit and the prices would move up with higher utilizations of the competitors as well. The Company expects pricing to increase 15-20% in the next 12 months.

• The Company is changing its focus to more local market rather than national advertising. Currently, national advertising is about 65-70% against 70-756% earlier and the Company expects it to go down to 20-40% in next 3-4 years.

• The 3^rd Phase of Policy has seen progress in the last 3 months. The Company expects 200 new towns to come up for bidding with about 600 frequencies to be released. The Company does not expect any spectrum to be released in the existing markets atleast in the next 3-4 years.

• The Company expects Radio market to grow at more than 30-35% going forward.

Event Management business

• Event Management business reported revenues of Rs 60 crore up 42% over last year with EBITDA break even. For Q4FY08, EBITDA margins stood at 4%. The Company believes that once Rs 100 crore are crossed the EBITDA margins would be 15-20%. The Company launched a new property "Teen Diva" in the quarter.

Out of Home business (OOH)

• The Out of Home business (OOH) reported revenues of Rs 46 crore in the quarter with EBITDA loss of Rs 2.8 crore. For FY08, the revenues stood at Rs 134 crore up from Rs 32 crore in the previous year with EBITDA loss at Rs 21.9 crore.

• The Company has around 16000 displays with 16 PRT screens in Delhi. The employees have also increased to 100 from 46 earlier.

• The properties in 2006-07 are profitable but those added in 2007-08 are not profitable. Any contract would break even between 6 months to 2 years.

• During Q4 FY’08, the company acquired many properties particularly Bus shelters in Banglore, Hyderabad and Chandigarh.

• Till date the investment in OOH business is Rs 230 crore and the Company plans to invest another Rs 250 crore in the next 2-3 years. During FY’09, the company has planned a capex of Rs 125 crore.

• The market share of the Company in OOH business is 11%.

• The management expects the OOH market to grow at 20%.

• The airport contracts contributed Rs 77 crore for FY08 evenly between the two airports. The Mumbai Airport contract was profitable whereas the Delhi contract was not profitable. On a steady state, the airport contracts would have EBIDTA of 15-20%. The license fees on both the airports would total to Rs 11-11.5 crore per month.

• In the Delhi contract, the Company has not received all the sites on account of renovation. There might be re-negotiation on the contract and the Company might see extension in the contract period. Also in the contract, license fees are higher in the first year as compared to second year.

• The occupancy at Delhi airport was 89% and Mumbai 75% for Q4FY08. The rates were flat at Delhi and improved for Mumbai. Over Q1FY08 to Q4FY08, the rates have increased by 30%. Of the maximum sites possible, for Delhi the Company currently has 50-60% sites and Mumbai 80-85% sites.

• Non-airport contracts (whose revenues stood at Rs 57 crore) are profitable with 35-50% EBITDA on steady state.