After passing his chartered accountancy, Mr. V. Devarajan started his career with Raymonds. After a varied exposure to different industries like textiles, steel and consumer goods, he joined Balaji Telefilms Ltd. as the CFO - his first foray in to the media industry. During his tenure, he has been instrumental in setting up systems and control mechanisms, which has resulted in improvement of the operational efficiency of the company.
In an interview with Equitymaster, Mr. Devarajan shared his views on the issues and prospects of the media industry and how is Balaji Telefilms Ltd. placed in the same.
EQTM: When one considers the cable TV viewership base in India, how have we grown over the last decade and how do you see this growing in the long term? Is the viewership base concentrated only in urban and semi-urban areas or are we seeing a much broader growth in this base? We sell only around 6 m TVs a year (and mostly replacement demand).
The cable TV viewer ship has witnessed a phenomenal growth over the recent years and the same is expected to grow further. Although it may take some time to beat the terrestrial numbers, its definitely making inroads into the hitherto untapped areas. With the number of non-cable homes and non-TV homes being so huge in the country, I think that this in itself is a big trigger for growth in the coming years.
EQTM: In this, how would you define the viewership base of Balaji Telefilms in particular?
If one looks at the TRPs, it's evident that viewer ship is scattered across cross sections across the country.
EQTM: The FICCI study has estimated the size of the entertainment industry at Rs 650 bn. But the industry is very fragmented in nature, be it broadcasters (including local channels) or content providers. In this respect, how do you see the industry growing over the long term? Is consolidation the name of the game in the future?
In any business, the name of the game is 'survival of the fittest'. Having said that, there is enough space for quality content providers irrespective of their size. However, within the community of content providers, I don't see any possibility of consolidation happening. For one, the successful ones may not find any value addition as also the unsuccessful ones consolidating within themselves doesn't make sense.
EQTM: The " style="color:blue" target="_blank">media and broadcasting industry, in the last couple of years, has suffered from reduction in adspend. Is the industry situation improving for the better? How has Balaji evolved over the last two years?
The industry is definitely on the growth path. And so is Balaji. Balaji has been consistent in delivering quality programs over a period of time.
EQTM: How would you rate the progress of Balaji Telefilms as a leading content provider over the last three years on various facets like de-risking of business model, etc?
The strategy has been to cater to different markets, languages and channels and produce programs in different genres. And Balaji has been successful in doing this. It is producing Telugu and Kannada serials apart from Hindi. It is present in regional market through Gemini TV and Udaya TV apart from the main line channels. Latest addition has been Doordarshan - to spread the basket further. While some of the programs are family dramas there are others which are youth-centric and thrillers.
EQTM: Your company is one of the leading content providers to broadcasters. What do you think are the key drivers and traits required to sustain the same?
Ability to narrate and present a story consistently well, continuously.
EQTM: Is it fair to say that the independent content provider model is a high risk one? Are you looking at any diversification over a period of time like film production, broadcasting etc?
While broadcasting may be ruled out, film production can be looked at, at some point in future. Ideal way to de-risk is to cater to a varied audience, channels, markets, geographies etc.
EQTM: You made a private placement recently and raised money. Could you throw some light on the reason for this and how do you plan to utilise the cash proceeds?
The promoters made the private placement.
EQTM: Your comments on Conditional Access System (CAS) and how does your company stand to benefit from the same?
As we always maintain, 'Content is the king'. As long as one delivers quality content, CAS will not affect. In fact, it can increase one's bargaining power.
EQTM: Could you please share with us the personalities and books that have influenced you the most?
Amitabh Bachchan for his time management and multiple tasking abilities.
EQTM: What takes up your time apart from work?
Watching television for official and personal reasons, catching up with family and friends, writing 'shayaris' when in the right mood.