Enable Enlighten Entertain Network18 Media & Investments Limited ANNUAL REPORT 2014-15 NETWORKED TO YOUR Corporate Information BOARD OF DIRECTORS Mr. Adil Zainulbhai Independent Director & Chairman of the Board Ms. Nirupama Rao Independent Director Mr. Deepak Shantilal Parekh REGISTERED OFFICE Independent Director 503, 504 & 507, 5th Floor, Mr. Rajiv Krishan Luthra ‘Mercantile House’ Independent Director 15, K.G. Marg, New Delhi – 110 001 Mr. Dhruv Subodh Kaji Tel : +91 11 4981 2600 Independent Director Fax : +91 11 4150 6115 Mr. Raghav Bahl Website : www.network18online.com Non-Executive Director Email Id : [email protected] Mr. Rohit Bansal CORPORATE OFFICE Non-Executive Director Express Trade Tower, Mr. Vinay Chand Chhajlani Plot No. 15-16, Sector 16-A, Non-Executive Director Noida – 201 301 (U.P.) Tel : +91 120 434 1818 COMPANY SECRETARY Fax : +91 120 432 4110 Mr. Yug Samrat REGISTRAR & SHARE TRANSFER AGENT AUDITORS Karvy Computershare Private Limited Walker Chandiok & Co LLP, Chartered Accountants, New Delhi Karvy Selenium, Tower - B, (formerly known as M/s. Walker, Chandiok & Co.) Plot no. 31 & 32, Financial District, BANKERS Gachibowli, Nanakramguda, ICICI Bank Limited Hyderabad – 500 032 Yes Bank Limited Tel : +91 6716 2222 Email-id : [email protected] Website : www.karvycomputershare.com What’s 48 Directors’ Report 74 Corporate Governance Report inside... STANDALONE FINANCIAL STATEMENTS 96 Auditor’s Report 100 Balance Sheet 02 We live in a transforming world 101 Statement of Profit & Loss 04 Connected with life 102 Cash Flow Statement Keeping life networked to the Accounting Policies & Explanatory 08 104 best, always! Information 10 A refreshing mix to refresh life CONSOLIDATED FINANCIAL STATEMENTS 16 Networked to the future! 143 Auditor’s Report 18 Letter to shareholders 148 Balance Sheet 20 Financial highlights 149 Statement of Profit & Loss 22 Board of Directors 150 Cash Flow Statement Management Discussion Accounting Policies & Explanatory 26 152 & Analysis Information 201 Notice We live in a transforming world – a world that is continuously evolving to cascade an all-encompassing transformation across the media and entertainment industry. Corporate Overview Management Discussion & Analysis Directors’ Report Corporate Governance Report Financials Notice In the dynamically shifting realities of the new world, we are a media network that is From media to new age media, from the continuously metamorphosing to keep pace traditional to the digital, in the globally with changing aspirations. changing world of today, we are constantly expanding to align with evolving needs. A network that is committed to keeping viewers engaged and helping them stay With news that satiates thirst for ahead, even when they are on the go. information, with content that stimulates intellect, and with entertainment that thrills A network that is perpetually innovating to the heart, we are networked to lives, across refresh the mind and connect with the heart media platforms. Creating new forums for through an exciting mix of diverse content. experiential shopping and transactions, we are an entity that is connected to the myriad And a network that is consistently leading demands and desires of people across to deliver exceptional value to audiences geographies. and stakeholders alike. We are Network18! Networked to your life... Annual Report 03 2014-15 Connected A powerful with life, asset-led entity Network18 Media & Investments Limited (Network18) is a beyond information leading Indian media and entertainment company. The exciting world of Network18 encompasses a diversified & entertainment... portfolio across television, digital and print media, spanning interests in television, internet, filmed entertainment, digital commerce, magazines, mobile content and allied businesses. Network18 still provides news and Network18 also has allied investments in Colosceum, views, but its information platter extends Topper, 24×7 Learning, Yatra and Ubona. The Group, beyond the traditional newspaper and TV powered by a strong asset base, operates several headlines to deliver digitally empowered news channels through its subsidiary, TV18 media solutions to match the new-age Broadcast Limited, which added five expectations. It always had some of the new channels to its portfolio during FY15. most entertaining programmes across media platforms but it has now expanded communities but in fact to create new the horizon of its entertainment portfolio to ones. It has developed a unique niche that provide the ultimate offerings in music, films, connects with the hearts of its viewers entertainment and more! across genres and geographies. Network18’s vision is not limited by the As a continually transforming entity, conventional. Its platform agnostic approach Network18 has networked its to infotainment spans a holistic strategy business model to the lives of that seeks not merely to address existing its stakeholders to deliver value! Mapping the journey Corporate Overview 1996 2006 2006 Incorporated as a private Name changed from SGA Converted into a public limited company on Finance & Management limited company in February 16, 1996 Services Private Limited to November 2006 Network18 Fincap Private Management Discussion & Limited in April 2006 Analysis 2007 2007 2014 Listed on the Bombay Name changed from Ownership transferred to Stock Exchange and the Network18 Fincap Limited Independent Media Trust National Stock Exchange to Network18 Media & (IMT), of which Reliance in February 2007 Investments Limited in Industries Limited (RIL) Directors’ Report Corporate Governance Report Financials Notice December 2007 is the sole beneficiary, in July 2014 Catering to an average of 30 plus Mn TV channels 229 viewers across channels and across regions1 27.2 Mn 16 per cent 92 per cent unique digital Revenue growth visitors per year-on-year EBITDA growth month2 1 Source: TAM, CS 4+, 1st Apr ’14 – 31st Mar ’15, All Days, 24 Hrs 2 Source: comScore Worldwide|UVs for April 2014 | Network18 Annual Report 05 2014-15 A period of transition Currently in a transitional phase, Network18 was acquired by IMT, of which RIL is the sole beneficiary, during FY15, along with its subsidiary, TV18 Broadcast Limited (TV18). At the root of this strategic acquisition was the immense potential of Network18 to scale new frontiers of growth in the evolving media and entertainment industry. With the completion of this transaction, IMT and RIL became promoters of Network18 and TV18. The Company now has a new management to help it grow business and to lead the organisation’s transition into a bigger and better entity. Corporate Overview Management Discussion & A future-centric Analysis strategic approach Directors’ Report Corporate Governance Report Financials Notice Thought leadership Visionary management Platform agnostic Innovation-led strategy Extensive experience Synergistic networking Collaborative approach Creative excellence Market Value leadership for all Brand legacy Credible reputation Annual Report 07 2014-15 Keeping life networked to the best, always! Network18 has, over the past one year, changed in many ways, but there is one habit it is not ready to give up; it is the Company’s constant endeavour to sustain its leadership position across its business segments and genres with its impactful innovations. Network18’s business strategy is steered by its commitment to keep its viewers ahead in life, always. From being early adopters of the latest digital and other technologies, to the pioneering home shopping initiative, its ground-breaking innovations have charted a new course for the industry through the years. From the fastest news breaks and balanced opinions to the most enthralling entertainment and foot-tapping music, it continues to be several steps ahead of its peers. It’s not just the social media where Network18 likes to see others follow it; the Company loves to lead in every possible way. Corporate Overview Management Discussion & Directors’ Report Corporate Governance Report Financials Notice 09 Analysis 2014-15 Annual Report A refreshing mix to refresh It was an exciting year at Network18. With a new management at the helm, strategic reorganisation led to increased life momentum and vibrancy in the business. While television saw the addition of five new channels and rebranding of a few existing ones, digital became trendier and the print business witnessed some much-needed consolidation and restructuring. Corporate Overview What’s been keeping us busy! Management Discussion & TELEVISION BUSINESS Analysis Business News CNBC-TV18 & CNBC Prime HD CNBC Awaaz This is what’s kept the team at Network18 busy through the year... Broadcast business remained ahead of Directors’ Report Corporate Governance Report Financials Notice the industry curve, with overall growth of India’s No. 1 business news television India’s No. 1 Hindi business news television 17 per cent and ad sales going up 16 per channel in the English business news genre, channel in terms of viewership, leading with cent. The ETV entertainment piece shifted in terms of viewership1 60 per cent market share2 to Viacom18’s flagship Colors brand and Dominates the genre with market share of the regional entertainment channels were 54 per cent1 Popular programmes rebranded to Colors. Viewers continued to jig ‘Stock 20-20’- a pre markets opening show to the MTV channel. Kids’ channels were on 24×7 coverage of corporate news, a high as more and more children got onto financial markets, industry news