THE THE BUSINESS TRUTH OF OF TRUTH BUSINESS ZEE MEDIA CORPORATION LIMITED ANNUAL REPORT 2018-19 Truth does not have colours. It does not come in different shades like half-truths. Like alt-truths. Like opinions that are coloured. Coloured by judgements. By fears. By vested interests. Truth does not care about any of those. We are in the business of truth. And truth is black and white. CONTENTS CORPORATE OVERVIEW The Business of Truth. The Truth of Business 01 - 11 Numbers - 2018-19 - The Truth Bearers 12 - 13 The truth of business - Message from the Chairman 14 - 15 Uncovering the Truth - Programming Initiatives 16 - 17 Events - Taking Content to the People 18 - 19 Corporate Profile - Channel Portfolio 20 - 23 Board of Directors 24 - 25 Corporate Information 26 MANAGEMENT REPORTS Notice 27 - 34 Directors’ Report 35 - 48 Corporate Governance Report 49 - 64 Management Discussion and Analysis 65 - 76 Certification on Financial Statements 77 FINANCIAL STATEMENTS Standalone Financial Statements 78 - 136 Financial Ratio & Analysis 137 - 138 Consolidated Financial Statements 139 - 204 CORPORATE OVERVIEW MANAGEMENT REPORTS FINANCIAL STATEMENTS “ “ TRUTH BE TOLD Engaging & inspiring content It takes lasting courage to show the truth as is, sans the layers of lies, manipulation or the fear of confronting the army of falsehood. We, at Zee Media, have always stood up to our firm belief of telling nothing but the truth. And this unwavering belief has taken us to where we stand today, at “ the pinnacle of THE BUSINESS OF TRUTH. As we grow together as a tree, spreading our roots firmly into the world of news and infotainment with a proverb of 'Truth Be Told'. That is the TRUTH OF OUR BUSINESS, which must be told. Living up to the commitment of telling the truth with engaging content, enlightening“ stories and gripping narratives, we have grown stronger ever since our inception, touching countless lives and creating a deep-rooted base in millions of hearts with the content we serve. During the financial year 2018-19 (FY19) too, we made our mark with insightful, engaging and impactful content and proving our mettle as democracy's fourth pillar. From live programmes like 'The Election Conclave 2019' on the 2019 general election, to bringing out the plight of economy's growth drivers – the truck drivers through 'Transform Truckers Abhiyaan' – what keeps us going is the urge to unveil the truth. During FY19, Zee Media Network won 7 awards on the prestigious ENBA platform. These included 'Best Continuing Coverage by a Reporter – Hindi (Rahul Sinha and Pooja Makkar - Kathua Gangrape and Murder Case, Zee News)', 'Best In-depth Series - Hindi (Toxic vegetable Cancer Story, Zee News)' and 'Business Channel of The Year – Zee Business', among others. We are in business of truth and an engaging & awakening content is truth of our business. Transform Truckers ENBA - Best Continuing Abhiyaan Coverage by a Reporter - A 5,000 km long truck journey Kathua Gangrape and connecting with truck drivers Murder Case with a focus on their health & fitness, road safety, financial The Kathua (J&K) Gangrape and planning, and new age trucks. Murder Case coverage on Zee News won ENBA's Best Continuing Coverage by A Reporter – Hindi award. Covered by Rahul Sinha and Pooja Makkar, this story provided a The Election deeply satisfying outcome when the Conclave 2019 culprits were sentenced. We at Zee News were appreciated by one and At The Election Conclave 2019, all for our committed efforts to leading parties' representatives unveil the chilling truth. faced questions from a jury and the audience about the existing governance and the future plans of each party. 04 | ZEE MEDIA CORPORATION LIMITED Annual Report 2018-19 | 05 CORPORATE OVERVIEW MANAGEMENT REPORTS FINANCIAL STATEMENTS “ TRUTH PAYS OFF In the business of truth, a lie is like a bee in a silent prayer room. The truth of our business is to protect the business of truth incessantly from the evil of falsehood and present what is pure, crystal, unadulterated, Truth. No matter how grinding and exhausting the way of truth is, the truth pays off eventually. Being at the forefront of serving people around the world with gripping content, engaging stories, and providing platforms to state the truth, Zee Media stands “ tall amongst its counterparts, with an impressive growth in FY19 over the previous year, which is an epitome of not only success but also the trust millions bestow upon us for showing nothing but the truth. A stellar performance We made history when“ we achieved our highest revenue ever – ` 6,869.2 million at a growth of 19.8% Y-O-Y. We outdid ourselves with an impressive 30.6% growth in EBITDA to clock ` 1736.4 million. We are way ahead of the industry in terms of revenue growth. While the industry clocked a CAGR of 11% (2016-2020), we grew 2½ times as fast with an astounding “ 26% CAGR (FY16 – FY20). Our TV viewership jumped to 345 million. We expanded our reach all across the Hindi speaking heartland and regional languages. We strengthened our international presence with WION. This stupendous growth is a fitting testimony to our commitment to truth and the effectiveness of our strategies. Did we hear someone say TRUTH DOESN'T PAY? Well, for us it did pay and that too handsomely. Topline Growth An impressive 19.8% Year-on-Year growth in topline, High Operating ahead of industry standards Profitability A 30.6% Y-O-Y growth in EBITDA, a mark in operational & financial excellence. Widening Revenue Inflow Zee Media converted all its network channels into Pay Channels, thereby monetizing the Network's reach & credentials. 06 | ZEE MEDIA CORPORATION LIMITED Annual Report 2018-19 | 07 CORPORATE OVERVIEW MANAGEMENT REPORTS FINANCIAL STATEMENTS THE MOMENT OF TRUTH The truth of our business is that each and every endeavour we make is for the business of truth. Preserving the truth is not an easy task. A lot goes in to make truth come out. Ever since we commenced operations, we have advocated only the truth. Our moment of truth is here. As we unveil our truth of being the market leader registering a stupendous growth this year over the previous financial year, we reiterate our commitment to bring truth to our valued viewers with new “ and innovative approaches. Zee Media's very existence thrives on truth and we strive to keep on innovating to discover newer ways to take our mission forward. An unwavering quest The year gone by saw us taking big strides in innovation across technology, business operations and strategies. During the year we launched India's first Anchorless News Channel – Zee Hindustan. We moved Zee Business operations for innovation to the nation's financial capital – Mumbai. We converted all our channels into Pay Channels thereby expanding our revenue streams. During the year, Zee Media test launched India's first Hyper-Local Channel, taking truth to the micro level reach. “ India's First Anchorless News Channel Zee Hindustan 'India's First Anchorless News Channel', a voice of clarity in the clutter of anchors claiming celebrity or semi-celebrity status. This is an example of our innovation at its best. Going Hyper-local Continuing Success of IMN Zee Media, first time One of our backend innovations in India, launched a was Integrated Multimedia Hyper-Local channel property. Network (IMN) – a repository of all information flowing in from all Zee platforms across the country and the world. We are basking in the continued success of this initiative. 08 | ZEE MEDIA CORPORATION LIMITED Annual Report 2018-19 | 09 CORPORATE OVERVIEW MANAGEMENT REPORTS FINANCIAL STATEMENTS TRUTH IS BEYOND BOUNDARIES “ Truth knows no boundary. It is beyond colours, shapes and forms reaching far and wide. It is said that truth can't be hidden no matter how much you cover. A lie doesn't have legs but truth has wings. With a powerful and inspirational mantra such as truth it would be a travesty if we did not reach out to more and more viewers. Being among industry leaders, Zee Media network stuck to its commitment of taking the truth wider and farther. Our extensive network transcends geographical and language barriers. Along with our digital channels we are proud to be among the leading news media organizations in the country. Our cumulative“ reach on TV channels is 345 million, and our cumulative reach through the digital channels is 421 million. We have 14 channels comprising 1 global channel, 3 national channels and 10 regional channels. These channels “ cover 8 states and 8 languages including Hindi & English. We have multiple digital websites covering general content and business content respectively. The expansion we envisaged in the previous year in terms of addressing the burgeoning digital space (43% of Indians An ever-growing & would be online by 2020) is progressing smoothly. We have strengthened our language websites (Tamil, Telugu, Malayalam, Kannada, and Gujarati) within the Zeenews.com property. We have simultaneously bolstered our widening reach presence on the existing properties in English, Hindi, Bengali, and Marathi sites. The steps we have taken show great results as our website visitors grew by 59% and page views grew by 106%. “ 345+ Million Viewers The 3 national, 1 global and 10 regional channels garner a whopping 345+ million viewers across our entire network. 14 Channels, 8 States 421+ Million Zee Media network has 3 Digital Viewers national channels, 1 global channel and 9 regional The Zee Media Network channels in 8 languages reached 421+ million including Hindi, English and viewers through its digital Urdu. One of the widest platforms -Zeenews.com, coverage. Zeebiz.com among others. 10 | ZEE MEDIA CORPORATION LIMITED Annual Report 2018-19 | 11 CORPORATE OVERVIEW MANAGEMENT REPORTS FINANCIAL STATEMENTS NUMBERS - 2018-19 THE TRUTH BEARERS 30% Growth in Operating Profit Highest Ever Revenue ` 6,870 Millions.