Music Broadcast Ltd

This conference call may contain forward-looking statements about the Company which are based on beliefs, opinions and expectations of the Company as on date of this call. These statements are not the guarantees of future performance and involve risks and uncertainties that are difficult to predict.

I now hand the conference over to Mr. Ashit Kukian – CEO from Music Broadcast Limited. Thank you and over to you, Sir.

Thank you. Good afternoon, everyone, and a very warm welcome to the Q4 and FY '25 Earnings Conference Call of Music Broadcast Limited.

Joining me on the call is Mr. Prashant Domadia – our CFO, Mr. Rajiv Shah from our IR Team, and our Investor Relations Partner, Strategic Growth Advisors.

In FY '25, the Company achieved a total revenue of Rs. 234 crores, making a year-on-year growth of 3% with an operating EBITDA at Rs. 40 crores at 16.8% margin. In terms of volumes, the industry de-grew by 2%, we have been able to make notable strides in our performance on the back of our efforts on the digital side.

Through the year, our digital business delivered an impressive 36% year-on-year growth, fully embracing the digital era where every tap and swipe unlocks new opportunities. Digital business contributes 11% to the revenues versus 9% in the year FY '24. These results highlight the success of our strategy which focuses on creating premium content, optimizing distribution channels and cultivating deep, meaningful connections with our audience.

This segment has shown a meaningful increase in the contribution to the overall revenue, underscoring both the scalability and the resilience of our approach. This strong and consistent momentum not only reinforces our standing as a leading player in the competitive digital media landscape, but also empowers us to capitalize on the emerging opportunities in the rapidly evolving media environment.

In FY '25, we achieved an inventory utilization of 77%, reflecting our strong operational efficiency and strategic resource management. Radio City continues to lead the industry as the preferred platform for advertisers, attracting 40% of the total client base across the sector.

Page 3 of 11 Notably, 32% of all new clients entering the radio advertising space have chosen Radio City, reaffirming our position as a trusted and effective partner. These accomplishments are a testament to the enduring strength of our brand. The confidence placed in us by the advertisers, and the success of our targeted marketing efforts in delivering measurable value.

We are also proud to have diversified revenue streams for the year, 27% of our income now coming from a variety of sources including properties, proactive pitches, digital ventures, sponsorship and special events. This balanced approach strengthens our overall financial resilience and stability.

During the year, we have made significant strides in our digital segments, achieving several key milestones. SMINCO, which is a data-driven influencer marketing platform, Muzartdisco which helps Indian-artists distribute their music in 120-plus countries. Exclusive partnership with Spotify, which is steadily growing over four states, boosting our influence in the digital music ecosystem.

All the initiatives that we have undertaken collectively opens the door to a vast Rs. 48,000 crores market, highlighting the immense growth potential for our organization. By steadfastly committing to digital innovation, we are transforming the way we engage with audiences, creating deeper connections. This strategic focus not only drives sustained growth but also solidifies our position as a leader in the rapidly evolving media and entertainment landscape.

Radio at its core is evolving, maintaining its vibrancy and relevance, while amplifying positive energy like never before. This smooth transfusion of the digital technology has forged a dynamic synergy between traditional radio and digital platforms taking it to a new era of innovation and expansion. At Radio City, we remain committed to generating sustainable value throughout every facet of our operations.

Our holistic business model is designed to create meaningful value for our listeners, strategic partners and the wider community. Our mission centers on empowering brands by delivering innovative and tailor-made media marketing solutions that leverage the latest advancements in technology. Through a strategic blend of cutting edge digital tools, dynamic social media engagement, and sophisticated content distribution methods, we aim to foster extraordinary

Page 4 of 11 connections between brands and their audiences, driving unparalleled consumer interaction and loyalty.

Looking ahead, we are committed to fostering sustainable long term growth in delivering lasting value to all our stakeholders, guided by steadfast dedication to innovation, adaptability and strategic excellence, we navigate the fast-changing media landscape with confidence.

Now, let me take you through the financial highlights of Q4 and FY '25:

For the quarter ended, revenue stood at Rs. 54.7 crores, while for the full year revenue stood at Rs. 234.5 crores. For Q4 '25, operating margins stood at negative Rs. 3.5 crores, and for FY '25 operating EBITDA stood at Rs. 40 crores with the margins at 16.8%.

Operating EBITDA is after adjusting for an one-time impairment of non-financial assets to the tune of Rs. 34.9 crores. As at March 31st, 2025, the carrying amount of the Company's net assets requirement for the Company to assess the carrying amount of non-financial assets, property, plant and equipment, right of use assets and intangible assets including under development.

For potential impairment, in line with the IndAS-36, the Company determined the recoverable amount of its assets by calculating the value in use and conducted that impairment loss needs to be recognized in the financial statement. Thus, the reduction in the value of Rs. 34.9 crores has been provided for in this financial result during the quarter year March 31st, 2025.

Reported PAT stood at minus Rs. 38 crores for Q4 '25 and minus Rs. 33.8 crores for FY '25. As of March 31st, 2025, our cash reserve stood at Rs. 349 crores.

Our liquidity position continues to be strong, granting us the agility to seize both present and future opportunities. This solid financial foundation allows us to respond effectively to market changes and actually perceive strategic initiatives as they emerge.

With this, I would request the moderator to open the floor for Q&A. Thank you.

Thank you very much. We will now begin the question-and-answer session. The first question is from the line of Ranodeep S. from MAS Capital. Please go ahead.

Yes. Thank you for the opportunity. It's interesting to see that the industry has de-grown actually 2%, and in that backdrop we have done better, though it's very marginal, just 3%. Is the management looking at the changing landscape? Case in point is, are we studying the business models of Pocket FM or Kuku FM? Example, because the reason I am picking on these companies because Pocket FM in FY '24 has kind of clogged a revenue of Rs. 1,050 crores and they have this affordable subscription plan which is penetrating into Tier 2 and Tier 3 cities. So is business thinking about these new ways of looking at business?

Page 5 of 11 The Pocket FM has not, cloud revenue is of Rs. 1,050 crores. I think the valuation of the Company would be of Rs. 1,050 crores, because the revenues are far lesser, if I am not mistaken.

Having said that, to respond to your question, you would be happy to know that your Company has launched a podcast platform called RC Swapper just about three weeks back. So we are looking at changing their consumption. And as we speak, we are creating almost close to about 350 hours to 400 hours of original podcast content, which will be distributed to RC Swapper.

And RC Swapper not only allows the content to be distributed in India, but through a global tier RC Swapper can now be distributed to 120 countries plus, globally, as far as podcast content is concerned. This platform will not only be distributing content created by us, but we will also be aggregating content created by other podcast creators who do not have the distribution model.

So, they are in line with your thoughts. And like I said, happy to announce that we have launched a podcast platform, RC Swapper.

Okay, fair enough. Another interesting observation, you say that 7,400 clients are new out of 10,800 total clients. Now it indirectly also means that a lot of clients who are actually in the industry are not coming back to radio, is this something of a concern?

Historically if you see the mix, every year 40% of your clients are retained who come with the value close to about 60%, 65% of the value for the next year. And 60% of newer clients come in who test radio, who bring in 35% to 40% of the revenues. So I am repeating myself.

Historically, there is a huge churn when it comes to number of advertisers. So usually 40% of your core advertisers, which is your large advertisers, get retained who contribute anywhere between the 60% to 65% of your revenues. The balance 35% comes from almost close to 60% newer advertisers and that is the kind of math that has been going around for radio for years.

Sure. And one last question, it's been five years since we struck a deal with Spotify, are we seeing ramp up in that?

Not five years, the deal with Spotify is close to just about a year. We have been giving content to Spotify earlier, as content created by us to be distributed on a monetary basis. That obviously everywhere it has been stopped because they have realized that it's not working for them. What we are currently talking about, we are an outsourced sales model for Spotify, because Spotify believes that the Radio City team understands audio better. So four states they have outsourced where our team is selling the Spotify inventory and we get a revenue share out of that. Okay, fair enough. Thank you. Thanks so much.

Thank you. The next question is from the line of Khushi, an individual investor. Please go ahead. Hi. Hello everyone.

Page 6 of 11 Yes. Good afternoon.

Hi, good afternoon. My first question to you is, as you mentioned that 77% is your inventory utilization, so this number is a quarterly number or an annual number?

It's an annual number that we are talking about. So what would be the quarter number?

I mean, 77% is the quarter number, the Q4 number that we are talking about. Sorry my apologies. Okay. Full year number would be?

It's almost similar to that, because I will give you the entire full year amount, it will be 78%.

Okay. My next question is, what is the volume growth of the Company for both, the quarter and for the year ended?

My other question is, what is the effective growth rate for both the quarter and full year? And how is it compared to the pre-COVID level?

No, the two tranches, the quarter level revenue has shown a de-growth largely because last year had a political based government advertising that is that and that, and at the overall level we have grown at 3% from a revenue perspective.

Okay. Also my last question is, what is the FCT and NFCT split?

See, pure FCT is around 65%, digital is 11% and the balance is NFCT.

Okay. Would you please again specify me the effective rate growth like I couldn't understand.

Growth rate is more or less the same last year and this year. To give you again, NFCT is around 24% to 25% of the overall numbers. Rate has been more or less the same between last year and this year.

Okay. Yes. And the rate which you provided, how is it compared to the pre-COVID levels?

Page 7 of 11 It's almost at 80% of the pre-COVID level, and that is something which we have been saying, it moved from a 65% to a 70% to 80%, right now it's hovering around 80% to 85%. Okay. Thank you. Thank you.

Thank you. The next question is from the line of Mani, an individual investor. Please go ahead.

Yes, hi. I had a couple of questions regarding the non-convertible redeemable shares that the Company has issued. So how does the schedule of events flow from now? I believe the redemption date is 2026 Jan, so does it mean on date specified the shares will get extinguished and the money will get credited into the accounts of the shareholders and it will get removed from the balance sheet of the Company, is that how it will flow? Or is there any approval spending and what are the specific events that are there? If you can clarify that it will be helpful.

No, no, no approvals. It will be that way only. There will be a redemption which is going to happen. And this borrowing will go out from the balance sheet.

Okay. So on the day of 20th, so the number of shares will get reduced for the Company and then the amount will get credited into the account of shareholders, is that correct? Yes.

Okay, okay. Fair enough. I mean, I just wanted to confirm that in terms of issuance.

We are talking about the preference shares, right?

Yes, correct. Yes.

Okay. So there will be no dividend applicable, that 0.01% will also not be applicable for next year because the date appears before? So there's no fresh direction from our balance sheet? No.

Okay. Perfect. Thank you. Thank you so much.

Thank you. The next question is from the line of Ravi Shah from VRS Capital. Please go ahead.

Page 8 of 11 Sir, I have two questions. My first question would be on our employee costs and other expenses.

So they have arisen quite sharply like 14% and 16%, respectively. So can you give some understanding why this has happened?

The increase in cost is at two levels. One, the standard nominal 8% regular increment that most media companies take is what has been taken. Also, like if you remember, we are expanding our digital presence. So there has been some investment in people that we are doing keeping the future in mind. And these two put together is resulting in the growth that we are talking about.

Understood. Sir my second question would be on the growth rate. So our growth has been quite moderate. So what is driving this, like what are the reason behind this, like what is impacting our business?

So if you do a peer group evaluation, you will see that overall Q4 has been a little dampener for us. And that is the only reason why the overall growth, because if you see at the YTD level, we were showing a 12% growth. It's just that that last one quarter which of course in the previous year had a huge impetus of the political advertising that has happened. Now everything has been come to normal, and we hope coming year our growth should be nominal and the fillip that we had in the Q4 of year last, it is not there, and it is a regular year for us.

Understood, sir. Thank you for the detailed answers and all the best. Thank you so much.

Thank you. The next question is from the line of Sakshi Pratap from Pratap Securities. Please go ahead.

Hi sir, thanks for the opportunity. I have a question on our digital side. Can you give me some information, how much we have invested this year and what would be the number for FY '26?

See, that is only on the platform of SMINCO we had invested roughly around Rs. 1 crore, that is only investment that we have done from the platform perspective. The rest of the investment which is reflected in the staff cost is on people, because as you know that we have launched multiple platforms to create content, to distribute those content. Like for example, we have got RC Studio which is a 24/7 streaming platform on JioTV. We have got Muzartdisco which is an artist and music discovery platform in which an indie artist can distribute songs in 150 plus countries plus. We have launched AI RJ Sia, which is a virtual AI RJ that we have launched.

And the last one of course is RC Swapper which is our podcast platform that we have launched.

So the only investment at the capex level, I mean, at the product level has been at SMINCO, all

Page 9 of 11 other is people investment that we have done. And they are all accounted as part of the whole people cost, there's nothing over and above that.

Understood. Also on the same, how much cash are we burning? And is it increasing or decreasing? If you can throw some light. Cash burning on? On the digital side.

There is no cash burnout, there's only a people cost that is there. Because if you see, there are two ways we are operating, one is of course generating revenues from our own assets, whether it's a social media asset or our own RJs who we are using as influencers. And the third party representation is just the value of the business share, revenue share that we have. So there is no cash burn out apart from the people cost that we are talking about.

Understood sir. Thank you so much for your answer.

Thank you. The next question is from the line of Payal Shah from Billion Securities. Please go ahead.

Good afternoon, everyone. Thank you so much for the opportunity. I have two questions. First, we have witnessed a steep decline in our margins for full year '25, so just wanted to know what number should we expect going forward? And what are the steps that we will be taking to improve our margins in FY '26?

I mean, we are looking at trying to be a healthy close to double digit growth when we look at the industry, and our own future prospects that we talk about. Of course realizing that the industry still is seeing some kind of challenges. Because while we are yet waiting for the SOPs that we will get from the government in terms of our licensing and so on and so forth, we are very prudently looking at our own cost. So as we go forward, you will see that we are having a tighter control on the cost, which is in our hands, and we will ensure that our margins will be much more than what we have demonstrated in the past year.

Okay, okay. Sir my next question then is on the industry front, so we have seen the de-growth in volumes for FY '25, so are people moving away from radio advertisement or what is it, like if you can share what kind of trend are we expecting for the next two, three years?

Page 10 of 11 radio, but if you are closely monitoring media, you will see that is affecting print, it's affecting television, to an extent it may also affect OTT. So it's a combination of all that.

So, I think what is reflective right now is the shift in the consumer consumption media pattern, and that is the reason why you have seen that your companies, along with radio, also developing digital presence which allows us to encash a part of that opportunity that is there. And that's why like I said, radio today is about a Rs. 2,700 crores, Rs. 2,800 crores industry, but when I made my opening remark I said, through these various digital efforts that we are doing, including our social media presence, we are looking at a roughly around Rs. 47,000 crores, Rs. 48,000 crores of opportunity area in the current Rs. 1,10,000 crores advertising market.

So that is what we are looking at and ensuring that we do not get stuck with the fact that if radio continues to be this percentage of the overall advertising, we love opportunities beyond radio also with radio at its core because radio brings in the credibility, the storytelling and the various strength that it shows us a medium.

Thank you so much for a detailed explanation. That's helpful. That's it from my side. Thank you.

Thank you. The next question is from the line of Pooja Mehta from JK Securities. Please go ahead. Yes, hello sir. Hi, good afternoon.

Good afternoon, sir. Sir I have couple of questions. First is, what kind of numbers are we seeing on the influencer marketing on our digital side of the business? And the second is, if you can give some guidance for FY '26?

Yes, I mean, influencer marketing, if you remember, we just started about six months back and right now we are consolidating. As we speak, we have got about 60,000 influencers on the platform. And this is a business which will gain traction. And right now, like I said, six months of the play and three months of getting into the act, hardly any revenue is there at this point in time, I mean, when you look at the overall way. But as we go forward, I am sure with the market opportunity of close to about Rs. 7,500 crores, Rs. 8,000 crores, we are looking at some play coming to us also, and that is what will add up to the overall digital growth that we are talking about. So, if you will see, last year we did a 36% growth, we are confident we will possibly show similar kind of growth this year too.

Sure. And could you give some guidance for FY '26?

Page 11 of 11 I told you, I mean, we are gunning for the close to double digit growth unlike in the past two years where the industry has shown growth which is not in tune with what I am talking about.

But that roughly comes from the fact because most of us have really realigned our business prospects beyond radio. And the way digital is growing and the way the digital contribution to the overall media advertising is happening, I am sure we will be very close to the aspirations that we carry for ourselves. It's like I told close to that double digit growth that we want to see. Sure. That was helpful. Thank you, sir.

Thank you. As there are no further questions from the participants, I now hand the conference over the management for closing comments. Over to you, sir.

We sincerely thank you for your active participation in today's earnings calls. As media consumption patterns in India evolve, fueled by a variety of content choices, the radio industry stands at the unique crossroad to blend the digital platform while preserving radio at its foundation. Our commitment remains steadfast in enhancing the digital landscape by harnessing our resources and partnership to deliver the greatest value to our customers. The presentations, earnings release and results are all available in the corporate website and stock exchanges. If you have any further inquiries, please get in touch with anyone of us or with Strategic Growth Advisors, our Investor Relations Partner. Thank you.

Thank you. On behalf of Music Broadcast Limited, that concludes this conference. Thank you for joining us. And you may now disconnect your lines. Thank you.