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Sun TV Network expects the contribution of revenues from its Cricket franchise and movie distribution business to rise substantially in the coming years. That’s according to the company’s management commentary in its 2023 annual report.
Sun TV is one of the largest television broadcasters in India operating satellite television channels across Tamil, Telugu, Kannada, Malayalam, Marathi and Bangla and besides airing FM radio stations across the country.
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Revenue mix
In FY23, the company’s consolidated revenue from operations grew by 5 per cent to Rs. 3,772 crore. Of the total revenues, income from subscription was the largest share at 45 per cent. It represents subscription fees billed to cable operators, authorized distributors, Direct to Home (DTH) service providers. The company also receives a subscription fee for its OTT platform, SUNNXT. The company’s subscription revenues dropped marginally by 2 per cent in FY23.
‘Advertising and sale of broadcast slots’ accounted for another 40 per cent of Sun TV Network’s operating revenues.
IPL boost
Sun TV Network owns SunRisers Hyderabad Cricket franchise of the Indian Premier League (IPL) and SunRisers Eastern Cape of Cricket South Africa’s T20 League. The Cricket franchise contributed 7 per cent of its total revenue from operations in FY23.
Cricket franchise revenues for the Indian and South African franchise are determined as per agreement The Board of Control for Cricket in India and Cricket South Africa, respectively.
In a recent report, Nuvama Institutional equities said IPL revenues of Sun TV will get a sustainable boost. According to Nuvama, IPL media rights were Rs. 3,300 crore per year earlier, which has jumped to Rs. 9,600 crore given the presence of Disney and Jio. It said nearly 45 per cent (Rs. 3,100 crore) of this delta goes to IPL teams.
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“Taking a revenue share of 20 per cent into account still leaves Rs. 2,500 crore to be divided among the ten teams. So, each team potentially nets Rs. 250 crore incremental revenue/year for four more years,” it added.
Jailer effect
Although movie distribution accounts only about 7 per cent of Sun TV Network’s total revenues, this segment recorded the highest year-on-year growth of 45 per cent in the previous fiscal.
The movie distribution revenues is also likely to post a strong growth in the current fiscal as the Sun Pictures produced bankrolled Jailer is having a phenomenal run at the box office. The Rajinikanth-starrer is nearing Rs. 650 crore in worldwide box office collections and continues to have a great run in cinemas even in its fourth week.
“We expect the revenue contribution from the cricket franchise to rise substantially, further supported by more revenue from movie distribution,” Nuvama Institutional equities, added.
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