Saregama India Ltd Q1 2026 Earnings Call Transcript

The following is excerpted from the question-and-answer section of the transcript.

Question: Harssh Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Thanks for the opportunity. A few questions from my side. So firstly, if you could kind of help us understand what challenges or headwinds the overall industry is kind of facing other than certain music apps kind of shutting shops. So basically, my question is coming from the point of view of YouTube. So I acknowledge that you mentioned that Q1 had some challenges. But in general, are we seeing, say, lower ad spends or lower number of advertisement run on music videos, which kind of impacts our monetization or is it something extremely temporary? Some thoughts on that? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 01, 2025 / 6:00AM, SARE.NS - Q1 2026 Saregama India Ltd Earnings Call

Question: Harssh Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Got it. Okay. And also, on the Media segment, so you (technical difficulty)

Question: Harssh Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Is this better?

Question: Harssh Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Yeah. So my question is on the Video segment. So I acknowledge that you mentioned that this year, we will start making profits. So, you're talking about the exit run rate or maybe on the full year, we will see profits? And what steps are you taking?

Question: Harssh Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Got it. And a related question, sir, any specific reason why the capital employed within the video vertical has gone up by almost 25% on a year-on-year basis?

Question: Harssh Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Got it. And lastly, any update on the profitability status of, say, Pocket Aces? And maybe if you could quantify the amount of losses we may have faced in Pocket Aces this quarter? And when do we think in terms of profitability, we'll end up be positive, yes.

Question: Lokesh Manik - Vallum Capital - Analyst : My question was just continuing on the Video segment. It's been now more than eight quarters that we've not seen significant profitability there. Does Pocket Aces get classified under the Video segment or there is a split between Video and Music? How do we look into this area?

Question: Lokesh Manik - Vallum Capital - Analyst : Okay. So the video is then driven by Pocket Aces now.

Question: Lokesh Manik - Vallum Capital - Analyst : Great. Vikram, my second question was more a clarification. Do we -- on a per stream basis, do we make more in YouTube versus audio platforms? That was the understanding we got from some channel checks.

Question: Lokesh Manik - Vallum Capital - Analyst : No, I don't need the number, just if it is higher or lower.

Question: Lokesh Manik - Vallum Capital - Analyst : No, Vikram, I'll just tell you where I'm coming from is more from the distribution network that we are creating. It shouldn't be the case that we create this distribution network. And when the audience comes back to us to listen to the music, it comes to a platform that is giving us a lower realization versus a platform which is giving us a higher realization. That was my only clarification I needed. Is that the case happening? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 01, 2025 / 6:00AM, SARE.NS - Q1 2026 Saregama India Ltd Earnings Call

Question: Lokesh Manik - Vallum Capital - Analyst : Okay. And in the short format, they were not able to compensate for the loss that we have seen from minimum guarantees from these platforms, which are shut down. They would be too small today. Is that a fair assessment?

Question: Lokesh Manik - Vallum Capital - Analyst : Fair enough. And the advertising budget that we see in the industry that is sort of at the macro level, if you see it is fixed. Now for that budget, there are different forms of content that are competing. Do you see music as seeing a threat in the form of a content from different forms of content that are emerging, which is playing down the growth in the music industry at 10% versus digital advertising growing like you mentioned, at 15%.

Question: Govindarajan Chellappa - CSIM - Analyst : Hi. Thanks for the opportunity. A couple of questions. First, we've been talking about the shift to subscribers in the music space for the last two years now. Relative to what you had expected, how has been the pace of the shift? Just looking from the numbers, it doesn't look like it's moved as fast as you would have anticipated two years back. And if that's the case, what is holding it back?

Question: Govindarajan Chellappa - CSIM - Analyst : I mean, if you can give some numbers at the industry level, what proportion of, let's say, consumers are now paid OTT plus YouTube together or just OTT?

Question: Govindarajan Chellappa - CSIM - Analyst : Okay. My second question is on videos. I mean, I know the amounts are small, but it does take a lot of management time and bandwidth in running a business like this. We've been doing this for the last many years from mid-2010. At what point do you take a call that it is working or not? It's no longer an experiment, right? It's been a pretty long time.

Question: Govindarajan Chellappa - CSIM - Analyst : Okay. And last question was on working capital. There's almost a INR210 crore increase in working capital during the quarter, and it's across all items. I mean, inventory has gone up a lot, receivables have gone up and payables have fallen. I know there is some quarterly fluctuation, but this just does seem to be a lot more than what you normally see from one quarter to another. Any particular reason for that?

Question: Anand Bhaskaran - Ksema Wealth Private Limited - Analyst : Yeah, good morning. Can you hear me?

Question: Anand Bhaskaran - Ksema Wealth Private Limited - Analyst : Yeah. I just want to know that -- I just want to know a clear indication of the way things are going in the segment revenue -- right now, I guess Music is contributing a 69% and Artist Management 11%, Video in 17%. So I just want to know like overall breakup what you see going forward for FY26 and FY27. What would be the main driver for the revenue out of these four segments?

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : Sir, you mentioned a few big players like Google used our song in their advertisement. How much revenue we earned whether it is more than INR5 crore in a year?

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : Okay. No problem, sir. Nowadays, how is content cost you find because a lot of Bollywood movies are lesser. So are you finding difficult to acquire content cost at comparatively low rates?

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : Okay. And sir, have you been valued our library of songs of film or other films we have made, any parameter to evaluate this valuation?

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : Sir, we have so many songs like 150,000 or films which we have made. Any parameter to value this content?

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : One thing is there in our mind, what is the valuation of our company? It is almost INR10,000 crore. So I would like to find whether our content cost is more than INR10,000 crore or less. That is in my mind.

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : I'm very novice in this music industry. So just asking you to whether any barometer is there to evaluate. That is my point.

Question: Ravi Naredi - Naredi Investment Private Limited - Analyst : Okay. And last, sir, almost INR700 crore, we will spend on content cost in financial year '26, '27. Thereafter, what will be our plan?

Question: Rahul Picha - Multi-Act PMS - Analyst : Thansk for the opportunity. have two questions. First one is on minimum guarantee on Spotify and JioSaavn. So what we understand is Spotify and JioSaavn has done away with minimum guarantee across the music labels. So just wanted to know when that minimum guarantee was taken away by the Spotify and JioSaavn? And what was the impact of it in our Q1 numbers?

Question: Rahul Picha - Multi-Act PMS - Analyst : Okay. And second question is on YouTube. So YouTube has changed monetization policy towards user-generated content. So has that impacted us in Q1? The growth has been impacted negatively in Q1 because of that?

Question: Pallavi Deshpande - Sameeksha Capital - Analyst : Yes, sir. Can you hear me?

Question: Pallavi Deshpande - Sameeksha Capital - Analyst : Yeah. Just wanted to understand on this recent movie released Saiyaara, where Yash Raj Films has kept it to themselves. Is that a new competitor in the market, or are we likely to see more such cases going ahead that they don't have a music label, I believe?

Question: Pallavi Deshpande - Sameeksha Capital - Analyst : Right. Sir, my second question would be that in terms of the comps, they become more difficult for us from 3Q, I guess, or 2Q because of three, two, last year bumping up the music licensing revenues. So, on the music licensing, if you could give some more color of any new big budget things that we have lined up, I mean, coming up in terms of the music rights we have acquired in Hindi big budget.

Question: Pallavi Deshpande - Sameeksha Capital - Analyst : Right, sir. And sir, my last question would be on this recent T-Series signed up with this artist of Saiyaara, the Kashmiri guy. So were we also in talks with this -- for this artist, anything on that?

Question: Pallavi Deshpande - Sameeksha Capital - Analyst : Right, sir. Sir, my last question, if I may. On this payback for the Haryanvi catalog that we've purchased, would that fit in that five-year period? And if you could share the cost of that acquisition? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 01, 2025 / 6:00AM, SARE.NS - Q1 2026 Saregama India Ltd Earnings Call

Question: Lokesh Manik - Vallum Capital - Analyst : Yeah, hi. Thank you again for the opportunity. Vikram, my follow-on question was we are seeing a trend in brand-sponsored podcasts. Do we have any play out there? What is your view going forward? How can Pocket Aces help us out there?

Question: Lokesh Manik - Vallum Capital - Analyst : Understood. And this quarter, we've seen a drop in advertising expense, whereas the content cost has remained the same. So what has driven this fall in advertising?

Question: Lokesh Manik - Vallum Capital - Analyst : Correct.

Question: Lokesh Manik - Vallum Capital - Analyst : Great. And lastly, if I --

Question: Lokesh Manik - Vallum Capital - Analyst : No, I can connect with your comment on new releases were not there this quarter. So maybe that is what has driven the expenses.

Question: Lokesh Manik - Vallum Capital - Analyst : Yeah. So, Vikram, just the last one was if you see ad rates in the industry going down and advertising revenue going down, does this then delay the payback period that you have to monetize your content? Does it impact that?