Jagran Prakashan: Getting diversified - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks


Login Failure
(Please do not use this option on a public machine)
  Sign Up | Forgot Password?  

Jagran Prakashan: Getting diversified

Dec 19, 2007

With new players attempting to cannibalise the existing market, established players in the India media and newsprint industry are increasingly trying to expand the pie itself. While the newspaper business continues to be the mainstay for Jagran Prakashan (JPL), in order to face the increasing competition and to diversify its revenues, the company has moved into newer verticals. It also has ventured into English newspaper segment, with the launch of City Plus and i-Next. English newspaper earns more than twice the advertisement revenues than that of Hindi newspaper. Also it de-risks the model. In this article, we give an insight into the company's diversified business model.

City Plus: It is a free English infotainment weekly covering lifestyle, health, fashion, food, gizmos and shopping guides, with a very focused target group of age bracket of 18 to 35 years in SEC-A & B regions. It was launched in September, 2006 in Gurgaon, Noida, Ghaziabad and Faridabad. The business model is solely dependent on ad revenues with high ad-edit ratio of 60% to 70%. The company hopes to leverage on the BPO, retail and real estate boom in these regions to earn high advertisement revenues. However, brand loyalty for a free newspaper is low and also does not have a large readership base. Further, there are no subscription revenues for the company. JPL has plans launch the product in 10 to 12 townships by FY08 and 25 to 30 townships by FY09 depending on the response.

i-Next - JPL launched a second brand iNEXT in Kanpur and Lucknow in December, 2006, with a subscription price of Rs 2. It is a bilingual daily in a tabloid format targeting the 18 to 34 age group in SEC A and B1. The company does not have to incur additional expenses as it would be able to use the existing infrastructure. JPL's aim is to target new advertisers and readers. The company is envisaging launching this brand in 6 to 7 key cities in the next fiscal. Though initially the margins might be affected, over a longer period the strategy is likely to pay off.

JPL entered into a strategic partnership with Independent News and Media PLC for publishing the facsimile edition of the Independent (international edition). Independent News has a global reach with operations in national, international, radio and outdoor advertising. It is more of a branding strategy entered by JPL. The company is also looking at acquisitions in the English newsprint front.

Beyond newsprint...
To diversify its exposure from print revenues alone, JPL has ventured into two new businesses: event management through Jagran Solutions and OOH advertising under the brand 'Jagran Engage'. The move is to offer its existing clients complete package in advertising, catering to local needs and hence have synergies with current operations.

OOH: JPL has ventured into OOH under Jagran Engage. JPL has launched its OOH operations in FY07. Jagran has brought 500 sites under its fold in the first few months of operations. The company has already earned Rs 180 m from OOH in FY07 (3 % of total sales), and expects it to scale up to Rs 1.3 bn by FY10E (11 % of total sales). The management is also positive on it breaking even in FY08. The OOH industry was estimated at Rs10 bn in 2006 and is expected to grow to Rs 21.5 bn by 2011, at a compounded annual rate of 16.5% (source PWC report).

Event management: The company entered this segment in FY05 and has grown at a CAGR of 230% over the last two years. Further its partnership with Independent News and Media would help JPL. It has earned Rs 120 m from this segment in FY07 and expects to touch Rs 500 m in FY10E.

Further, JPL also launched its internal portal (www. Jagran.com) in 1997 and has tied up with Yahoo India to launch a new co-branded Hindi news and current affairs internet portal.

To conclude...
The new businesses are linked to the existing client relationships and infrastructure and hence capex requirements would be low. Further, these segments have higher margins, thereby improving the margins of JPL in the long run. However, the execution risks remain.

Equitymaster requests your view! Post a comment on "Jagran Prakashan: Getting diversified". Click here!

1 Responses to "Jagran Prakashan: Getting diversified"

jay shankar mishra

Apr 3, 2011

world cup jitne ke liye aur bharat ke aan ban aur saan ke raksha ke liye team india ko AAKHIL BHARTIYE MITHILA SANGH DABHANGA KE AUR SE AUR AAKHIL BHARTIYA MITHILA SANGH KE CONVENOR SHRI SURENDRA NARAYAN MISHRA KE AUR SE bharat basiyo ko bhut -bhut shuvkamnaye .aur mithila sangh darbhanga dhoni ,sachin ,gautam gambhir ,virat kohli ,zaheer khan ,yuvraj singh aur harbhajan ko match ke saandar jeet ke liye badhiye date hai.
Convenor-aakhil bhartiya mithila sangh,darbhanga. sampadak mahode- aasha hai ki aap aapne aakhar me ise chap kar hme aanugrahit karenge.

Equitymaster requests your view! Post a comment on "Jagran Prakashan: Getting diversified". Click here!

More Views on News

JAGRAN PRAKASHAN 2020-21 Annual Report Analysis (Annual Result Update)

Nov 1, 2021 | Updated on Nov 1, 2021

Here's an analysis of the annual report of JAGRAN PRAKASHAN for 2020-21. It includes a full income statement, balance sheet and cash flow analysis of JAGRAN PRAKASHAN. Also includes updates on the valuation of JAGRAN PRAKASHAN.

JAGRAN PRAKASHAN Announces Quarterly Results (3QFY21); Net Profit Down 6.0% (Quarterly Result Update)

Feb 10, 2021 | Updated on Feb 10, 2021

For the quarter ended December 2020, JAGRAN PRAKASHAN has posted a net profit of Rs 769 m (down 6.0% YoY). Sales on the other hand came in at Rs 4 bn (down 27.2% YoY). Read on for a complete analysis of JAGRAN PRAKASHAN's quarterly results.

What Fuelled the Sudden Surge in PVR and Inox Shares Today (Views On News)

Sep 27, 2021

Shares of both multiplex chain operators surged almost 18% to hit their 52-week highs.

8 Penny Stocks with Exceptionally High Promoter Holding (Views On News)

Sep 25, 2021

While high promoter holding is a good thing, there can be rare cases where penny stock promoters use misleading information about the actual valuation.

Shareholder Activism Triggers a 30% Rally in Zee Entertainment Shares (Views On News)

Sep 14, 2021

Zee Entertainment shares zoom after top investors seek CEO and MD Punit Goenka's removal.

More Views on News

Most Popular

Infosys vs TCS: Which is Better? (Views On News)

Nov 26, 2021

In the post pandemic era, the top two IT companies in India are fighting to capture the growing demand for IT.

This Multibagger Stock Zooms 20% After Dolly Khanna Buys Stake (Views On News)

Nov 24, 2021

Shares of this edible oil company zoomed over 50% in three days after ace investor bought around 1% stake.

6 Popular Stocks that Turned into Penny Stocks (Views On News)

Nov 27, 2021

A look at popular stocks that crashed big time and never recovered, i.e. which went from 'Multibaggers to Multibeggers'.

India's Top 5 Monopoly Stocks to Watch Out for (Views On News)

Nov 30, 2021

These 5 companies dominate their sectors with a huge piece of the pie.

5 Indian Companies Embracing Blockchain Technology (Views On News)

Nov 23, 2021

Blockchain adoption in India was slow in the past. Now, the technology is being well received.


Become A Smarter Investor
In Just 5 Minutes

Multibagger Stock Guide 2022
Get our special report Multibagger Stocks Guide (2022 Edition) Now!
We will never sell or rent your email id.
Please read our Terms


Dec 6, 2021 03:32 PM


  • Track your investment in JAGRAN PRAKASHAN with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks