Saregama India Ltd Q3 2025 Earnings Call Transcript

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

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Yeah, thanks for the opportunity, a few questions from my side. So firstly, if I dissect the revenue vertical, right, so what I observe is that a pure Music Licensing revenue. So that is excluding Carvaan or the Artist Management has grown by just 12% on a year-on-year basis. So considering the views that we have on YouTube and the plays on the OTT platform, doesn't this growth seem to be a tad lower? So essentially, what I'm trying to understand here, is it a case wherein the catalog music is not growing so much maybe in single digits. If you would help us understand.

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Okay. So if you could, kind of call out, approximately what rate is the catalog music growing at? REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 10, 2025 / 10:30AM, SARE.NS - Q3 2025 Saregama India Ltd Earnings Call

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Got it. Any number you would like to quantify as to what would be the impact of the closure of the Wynk App?

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Okay. Secondly, on the video segment, right, so if I look at the absolute EBIT for the nine months of FY25, it's still negative. So I understand that this quarter there was a bit of write-off that you have done on a conservative basis, but how should one look at the profitability of this division, if you could give a ballpark range of the margin one should expect on an annual basis, not a quarterly basis.

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : So single-digit EBITDA or EBIT?

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Okay. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 10, 2025 / 10:30AM, SARE.NS - Q3 2025 Saregama India Ltd Earnings Call

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Correct? Got it. And lastly one clarification, so the show that we are doing in collaboration with Viraj Ghelani, who is one of our artists, so, the revenue is booked within the Live Events vertical or within Artist Management?

Question: Harssh K Shah - Dalal & Broacha Stock Broking Pvt Ltd - Analyst : Live Events, okay. Got it. That's it from my side. I'll be back in the queue.

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : Hello, can you hear me okay?

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : Just be interested in, when you're talking about the aggressive '25, '26, '27 investment, just how you're thinking in terms of return on capital on that, and if you could just explain a little bit the kind of the sequencing of the P&L, how that comes through. I'm fully supportive of kind of investing for growth, but I just want to understand how the impact of that and how you see in terms of value generation.

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : When you say a five-year payback, could you just clarify how you're calculating 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. FEBRUARY 10, 2025 / 10:30AM, SARE.NS - Q3 2025 Saregama India Ltd Earnings Call

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : Okay, and so given the aggression of your investment at the moment, you're effectively, your write-off through the P&L are just exceeding the marginal gains on the kind of the P&L benefit side in during that kind of period, but then they're expected to inflect back the other direction. Is that correct?

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : So when you're -- as you're accelerating your investments, as you're going through the accelerated investment phase, then the P&L kind of dilute of effect of the upfront write-offs exceeds the benefit temporarily, is that correct?

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : Yeah, understood. And could I just ask about the kind of the impact you're expecting from the exits of free platforms? So you talked about the two which are already shut up shop. Does that impact you kind of temporarily in terms of any kind of monetization you're putting through those platforms and how do you see that shaking out?

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : That's really helpful. Thanks very much.

Question: Jyoti Singh - Arihant Capital Markets Limited - Analyst : (technical difficulty)

Question: Jyoti Singh - Arihant Capital Markets Limited - Analyst : Yeah, I'm using my handset only. So, thank you for the opportunity. My question is on the Event side business. Like, we have done very good in this quarter. So what are the expectation going forward, we are expecting similar kind of performance and also how much margin we are expecting going forward or the -- if we are seeing similar kind of trend, so it will going to impact on the margin?

Question: Jyoti Singh - Arihant Capital Markets Limited - Analyst : Okay. Thank you so much, sir. And sir, on the margin side, basically, margin is the main concern with Saregama compared to our competitor. So when we going to see the stable or good margin?

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : Thank you so much.

Question: Pulkit Chawla - Emkay Global Financial Services - Analyst : Yeah, thanks for repeating my question. So the first part, I think, do you, somehow feel that with the growing popularity of the shorts format, does something like a YouTube shorts cannibalize your long-term format? Given that today at this point of time, monetization is slightly better on the long format as compared to the short format. Does that make monetization slightly more different, difficult. And second, if you could just help me, it's been a year since you've now acquired Pocket Aces, where we are on the path to profitability. So last year was slightly weaker on the revenue growth front also. So if you could just highlight what steps have you taken, for Pocket Aces.

Question: Pulkit Chawla - Emkay Global Financial Services - Analyst : The Pocket Aces profitability part on the trajectories.

Question: Pulkit Chawla - Emkay Global Financial Services - Analyst : Thanks again. That's super helpful. Thank you.

Question: Rucheeta Kadge - i-Wealth - Analyst : Hello, sir. A very good evening. So my question was on the Events business. So, what are the kind of events that are lined up for the next year, if you, can you give me a sense on that?

Question: Rucheeta Kadge - i-Wealth - Analyst : Okay. So sir, my question was in the direction that in the last 9 months or 12 months if I see. On an average, our growth has been very massive. So going ahead, obviously, the base is going to be higher. So with that growth taper down you see direction it should grow in maybe 50%, 60%.

Question: Rucheeta Kadge - i-Wealth - Analyst : Got it. And so just one last question. Sorry if I'm repeating it, but just wanted to understand, get a sense on the content cost which is amortized. So if you could give an example of a 100-piece content we are acquiring, how much of it are we amortizing, how much of it is marketing and going ahead then how do we amortize that?

Question: Rucheeta Kadge - i-Wealth - Analyst : So from second year, would it become lower and lower, like 20% in your one, so then maybe 10%.

Question: Rucheeta Kadge - i-Wealth - Analyst : Okay. Understood. Yeah, that was it from my side. Thank you so much.

Question: Swapnil Potdukhe - JM Financial - Analyst : Hi, thanks for the opportunity. My question is with respect to your guidance at the start of the year, wherein we had said that Music Licensing plus Artist Management will grow around 25% to 26%. Now, if I were to look at your numbers still nine in, it appears that we are somewhere in between 17%18%. So we are quite far away from our original guidance for this particular year. So any thoughts around, how -- REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 10, 2025 / 10:30AM, SARE.NS - Q3 2025 Saregama India Ltd Earnings Call

Question: Swapnil Potdukhe - JM Financial - Analyst : Okay, and secondly, on your cost side, if you look at your employee, expenses, there has been some volatility in terms of how much employee cost have been the quarter-on-quarter basis. So you started with roughly around INR26 crore in 1Q. Then it went up to INR30 crore. Now it's down to INR27 crore. Just wanted to get the, I mean, what's bringing such (multiple speakers)

Question: Swapnil Potdukhe - JM Financial - Analyst : Understood. And just the last one if you can squeeze in, so we have been talking about our Carvaan business, some we're taking some efficiency efforts over there, right, trying to bump up the margins on that said. Anything that you can call out as to where are we in terms of that effort, any improvement in the market the business?

Question: Swapnil Potdukhe - JM Financial - Analyst : Got it. Thanks a lot for the opportunity and all the best.

Question: Abhishek Kumar - Sanctum Wealth PMS - Analyst : Hi, good evening. So my question, I guess most of it is answered. I had this question on the hip-hop folio. So I just --

Question: Abhishek Kumar - Sanctum Wealth PMS - Analyst : My question was on the hip-hop folio which we had made this quarter. And our partnership with Hustle 4 and where we have acquired the songs and plus the artist. So just wanted to know the thought process behind it and how our strategy would be going ahead in this.

Question: Abhishek Kumar - Sanctum Wealth PMS - Analyst : Oh thanks a lot for our detailed and it's really good to know that we are moving towards the more younger audience of 14 to 26 which you mentioned. So that is something which I guess really appreciated. And last question, I know these previous participants have asked about live events. So this is a bit different aspect given that we have sent kind of set a benchmark with respect to Diljit concert this year and which was a success. So how do we kind of move ahead from this one? So the benchmark which you have said is really high and how do you think about the artists which they will have for this year? Indian artists, Punjabi artist, Hindi, or maybe if you think of any Western artist. So it's kind of --

Question: Robert Marshall-Lee - Cusana Capital LLP - Analyst : Okay, got it. Thanks a lot, Vikram, and to everyone. Thank you. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. FEBRUARY 10, 2025 / 10:30AM, SARE.NS - Q3 2025 Saregama India Ltd Earnings Call

Question: Pura Brati - RBA Finance and Investment - Analyst : Hi, sir. Good evening. Congratulations on the record set of numbers. So, my question would be on a more of a -- you see how Live Events are getting traction from, as you said, the younger audiences, would want to know if Saregama would be open to touring art, like how we send Diljit Dosanjh abroad. Would we be seeing artists abroad such as the Taylor Swift or a Coldplay who just backed Bombay, Saregama touring them and producing shows with them.

Question: Pura Brati - RBA Finance and Investment - Analyst : Saregama does have scope of touring Diljit abroad, but also getting artists abroad.

Question: Pura Brati - RBA Finance and Investment - Analyst : Sir, one last question. As you said, so for live events sponsorship, just curious, we had toured Dil Luminati tour in USA and Canada. Why were the ticketing revenues of those shows not counted for in our books?

Question: Pura Brati - RBA Finance and Investment - Analyst : Oh yeah, thank you. That answers my question.