The Indian Entertainment and Media Industry Growth: A Deep Dive into Rapid Growth

The Indian entertainment and media industry is one of the fastest-growing sectors in the country, marked by intense competition among over 40 diverse content providers. This vibrant industry encompasses a wide array of segments, including television, radio, print, films, digital advertising, music, out-of-home (OOH) advertising, animation and VFX, gaming, and live events.

Impressive Growth Trajectory

The industry’s growth trajectory is truly impressive, with annual revenue expected to increase by 9.7 percent, reaching USD 73.6 billion by 2027. One of the key drivers of this growth is the video OTT market, which is dominated by major players like Amazon Prime Video, Netflix, and Disney+ Hotstar. This market is projected to double its revenue from USD 1.8 billion in 2022 to USD 3.5 billion by 2027. India is home to an estimated 481 million OTT users and 101.8 million active paid subscriptions.

Booming Gaming Sector

India stands out as the world’s largest mobile gaming market in terms of app downloads. The revenue from transaction-based games has surged significantly, with the sector projected to grow by 20 percent annually, reaching $231 billion by FY25. The country also boasts the largest fantasy sports market globally, with a user base of 180 million. This industry is expected to grow at a CAGR of 33 percent, reaching $25,300 crore by FY27.

Over the past five years, the Indian gaming industry has attracted USD 2.8 billion in funding from domestic and global investors, marking a 380 percent increase from 2019 and a 23 percent rise from 2020. Notably, India has produced three gaming unicorns: Game24x7, Dream11, and Mobile Premier League.

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Government Initiatives

The Indian government has implemented various initiatives to bolster the entertainment and media industry. These measures include digitizing the cable distribution sector to attract greater institutional funding and increasing the FDI limit from 74 percent to 100 percent in cable and direct-to-home (DTH) satellite platforms. Additionally, granting industry status to the film industry has facilitated easier access to institutional finance.

The Ministry of Information and Broadcasting has established the Film Facilitation Office (FFO) as a single-window clearance and facilitation point for producers and production companies, assisting them in obtaining requisite filming permissions. In December 2020, the ministry also merged its film media units into one corporation, promoting the convergence of activities and resources for better coordination and efficiency.

Financial Performance

The financial performance of the Indian entertainment and media industry reflects its robust growth. Among 20 companies under coverage, the average sales change for PY24 was 11.43 percent compared to FY23. The top five industry leaders by market capitalization saw revenue growth of 27 percent for FY24 compared to FY23. The average operating profit for the top five companies stood at 31 percent for FY24, albeit a slight decline of 36 basis points from FY23. The average PAT margin for the top five was 13.42 percent for FY24.

PVR Inox exhibited the highest revenue growth among industry leaders, with a 62.82 percent increase in FY24, reaching ₹6,107 crore. The company’s average ticket price was ₹233, and the average spend on food and beverages was ₹129 in Q4FY24. Additionally, PVR Inox opened 33 new screens across six properties in Q4FY24.

Network TV18 followed with a 49.4 percent revenue growth in FY24, amounting to ₹9,297 crore. This growth was driven by its sports and movie segments, with Jio Cinema emerging as the fastest-growing platform in the country.

Outlook

The Indian media and entertainment industry is poised for continued impressive growth, outpacing the global average. This growth can be attributed to rising incomes, increasing internet penetration, and a significant push toward digital adoption. The industry is expected to benefit from the burgeoning retail advertisement market, driven by new entrants in the food and beverages segment, the growing popularity of e-commerce, and domestic companies exploring new opportunities.

In conclusion, the Indian entertainment and media industry stands as a beacon of rapid growth and innovation, supported by robust government initiatives and a dynamic market landscape. With its diverse segments and impressive financial performance, the industry is well on its way to achieving its ambitious growth targets.

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