Star India suffers loss of Rs. 1,216 crore in FY19

As per its filings with the registrar of companies (RoC), Star India has reported a net loss of Rs. 1,216 crore (12160 million) for the FY19, in comparison to its net profit of Rs. 287.7 crore a year ago. (According to The Economic Times) After Walt Disney acquired Rupert Murdoch’s 21st Century Fox in a $71 billion cash and stock deal in June 2018, Star India’s revenue from operations increased by 35 per cent YoY to Rs 12,341 crore in FY19. The merger makes Star India, Fox Star Studios and Hotstar in India, a part of Walt Disney. The company’s total revenue from operations stood at ₹12,341 crore in FY19 compared with Rs. 9,149 crore a year ago. This includes advertising revenues of Rs. 7,311 crore ($73110 million), up by 49 per cent, and distribution revenue of Rs. 4,128 crore ($41280 million), up by 9 per cent. Revenue from other sales and services doubled to Rs. 902 crore ($9020 million). The loss was attributed to the recorded expenses of Rs. 4,000 crore on its marquee sports property, the Indian Premier League (IPL), despite a 35 per cent increase in revenues during the year. In September 2017, Star India bagged the global broadcast and digital rights for the IPL for Rs. 16,347.50 crore ($163475 million) for five years (2018-2022). The loss was also attributed to Star’s digital streaming platform Hotstar, which posted a net loss of Rs 558.38 crore ($5583.8 million) on revenue of Rs 1,112.74 crore for FY19. During the fiscal, Star India invested Rs 832.32 crore ($8323.2 million) in Novi Digital, the holding company of Hotstar. The conglomerate’s total expenditure also jumped 58 per cent to Rs. 13,707 crore from rs. 8,694 crore a year ago. The spike in costs may be primarily attributed to a 66% increase in programming and operating cost to ₹10,296 crore, a 34% jump in employee cost to ₹1,198 crore, and a 57 per cent jump in marketing cost to Rs. 1,168 crore. This news comes only a few weeks after the exit of former Star and Disney India managing director Sanjay Gupta, who lately joined Google India as country manager and vice-president of sales and operations for the country. As far as new offerings go, India awaits the streaming of Disney+ content on Hotstar soon. Walt Disney that launched the ad-free video streaming service in the United States earlier this month, will route the original content created for the new OTT service and its movie library to Indian audiences through Hotstar. Disney+ has debuted with content bundled from Disney, Pixar, Marvel, Star Wars and National Geographic. Priced at $6.99 per month and $69.99 per year in the US, the service launched with nine original shows. In India, Star plans to continue with its current subscription plans—Hotstar Premium at Rs. 299 per month and Rs. 999 per year and Hotstar VIP at Rs. 365 per year, even after the launch of Disney+.