Next Mediaworks Ltd Management Discussions

Indian Economy

Amid uneven global growth and persistent external headwinds, the Indian economy remained resilient in (financial year) FY 2024–25, supported by strong macroeconomic fundamentals, timely policy interventions, and continued public capital spending. Real GDP growth moderated to 6.5%, down from the previous year, yet remained the highest among major economies, reinforcing Indias status as the fastest-growing large economy.

On the demand side, growth was driven by a rebound in private consumption and a positive contribution from net exports. On the supply side, expansion was supported by robust performance in the services sector and a recovery in agricultural output.

Headline inflation averaged 4.6%, down from 5.4% in FY 2023–24, reflecting easing input costs, targeted supply-side measures, and continued effects of earlier monetary tightening. However, core inflation rose slightly in the latter part of the year, largely due to elevated global gold prices.

Indias financial markets remained broadly stable despite global volatility. Liquidity conditions were mostly in surplus. The rupee depreciated against a stronger US dollar, driven by rising US yields, but remained relatively stable versus other emerging market currencies. Fiscal and current account deficits stayed within manageable levels, supporting orderly currency adjustment.

Looking ahead, Indias macroeconomic outlook remains anchored in strong domestic demand, improved supply dynamics, and prudent fiscal management. However, risks from geopolitical tensions, commodity price volatility, and tight global financial conditions warrant close policy monitoring to maintain growth momentum.

Source: Basis RBI Annual Report, 2025

Outlook

Indias economic outlook for FY 2025-26E remains broadly optimistic, supported by strong domestic fundamentals and a stable policy environment. Continued government focus on capital expenditure, alongside fiscal consolidation, has helped sustain growth momentum. A well-capitalized banking system, healthier corporate balance sheets, and resilient financial markets provide a solid base for expansion. Growth remains led by the services sector, with improving consumer and business sentiment further supporting demand.

Headline inflation dropped below the RBIs 4% target in the last couple of months of the concluded fiscal, primarily due to a sharp correction in food prices; strengthening expectations of price stability. With inflation appearing contained and growth steady, the monetary policy stance is likely to remain accommodative in the near term – supporting recovery while remaining vigilant to global risks.

However, external headwinds persist. Geopolitical tensions, uncertainty around evolving tariff regimes – notably in the U.S. – and a war-like situation on the national front earlier in the ongoing fiscal year have potential to introduce volatility and disrupt trade flows. These factors pose downside risks to both inflation and growth, necessitating continued policy vigilance and close tracking of global developments that could impact domestic macroeconomic conditions.

Source: Basis RBI Annual Report, 2025

Indian Media and Entertainment Industry

In (calendar year) CY 2024, Indias Media & Entertainment (M&E) sector grew to INR 2,502 bn, registering a 3.3% year-on-year growth. While slower than the 8.3% expansion in CY 2023, the sector regained its pre-pandemic levels, driven largely by an 8.1% increase in advertising revenues, especially from digital platforms.

For the first time, Digital media overtook Television to become the largest M&E segment, despite a moderation in its growth rate. Traditional formats continued to face pressure, particularly from declining subscription revenues.

The Radio segment, a traditional medium, recorded positive growth, driven by higher advertising volumes and the expansion of alternate revenue streams. NFCT (Non-Free Commercial Time) contributed up to 20% of total segment revenues. Yet, overall levels remain below the pre-pandemic benchmark.

Source: EY FICCI M&E Report 2025

M&E Industry Segment-wise Revenue and % Growth Outlook

Indias Media & Entertainment (M&E) sector is projected to reach INR 3.1 tn in the coming years, growing at a 7% CAGR, with Digital media driving over half of this expansion. Segments such as OTT platforms, digital advertising, online gaming, and live events are expected to lead this growth, while traditional media may continue to face some structural headwinds. Advertising will remain the sectors dominant revenue stream, contributing over 50% of total revenues.

Radio is also poised for growth, benefiting from higher event-linked revenues and innovation in bundled offerings. These shifts reflect broader efforts to diversify revenue streams and adapt to changing audience behavior. With rising ad volumes and greater consumer engagement, the sector is positioned for steady growth, reinforcing its role as a key pillar of Indias M&E landscape.

Going forward, sustained sector momentum will depend on adaptability, continued investment in content creation and distribution infrastructure, and a focus on innovation to meet evolving consumer expectations.

Source: EY FICCI M&E Report 2025

Indias Radio Sector

Radio segment recorded a 9% growth in CY 2024, reaching INR 25 bn. Despite this improvement, it remains below pre-pandemic levels, currently standing at 81% of CY 2019 revenue. Advertising volumes grew marginally by 3% over the previous year, but advertising rates continued to remain subdued, limiting further revenue acceleration. The segments overall growth trajectory was largely supported by diversification beyond traditional advertising slots.

A key highlight for the year was the rise of NFCT revenues, which contributed an average of 20% to total radio revenues in CY 2024, marking the highest share since CY 2017. Rising NFCT revenue contribution, underscores a strategic shift toward alternative monetization channels such as branded events, sponsorships, and digital extensions. This diversification has become essential for the segment to sustain relevance and profitability.

Source: EY FICCI M&E Report 2025

Radio Segment Revenue (in INR bn)

Advertising Volumes

Radio advertising volumes saw a modest 3% increase in CY 2024, as compared to the previous year, with an average of ~600 ads per station per day. Services, Auto, and Retail sectors were the largest contributors, together accounting for half of the total advertising volume. Despite this growth, the total number of brands advertising on radio fell by 6%, totaling around 12,800. The majority of radio advertising insertions i.e. about 62% came from the top 10 cities, a figure that has declined by 7% from the previous calendar year. Among states, the top five states collectively contributing 62% of advertising volumes.

Source: EY FICCI M&E Report 2025

Outlook

The Indian Radio industry is poised for a measured recovery, projected to reach INR 30 bn by CY 2027E. Growth will be led by the continued rise of NFCT revenues and modest gains in FCT (Free Commercial Time), supported by urbanization and rising car ownership in non-metro markets.

However, traditional FCT volumes are nearing saturation, and further expansion will depend on structural improvements– notably higher advertising rates. NFCT revenues are projected to grow at 20% CAGR; contributing 29% of total segment revenues by CY 2027E, up from 20% in CY 2024. Players will increasingly leverage their ground-level sales networks to deliver integrated brand solutions.

The rollout of ~730 new FM channels across ~234 cities under the Phase III FM Radio Policy is expected to further localize content. However, participation may be limited as private FM operators expansion plans are likely to be selective and strategic. While the proposed 4% license fee and proposed decoupling from NOTEF in this auction phase offers partial relief, a more enabling regulatory environment will be essential for long-term sustainability.

Radio companies shall continue to be innovative, targeting regional advertisers and underserved mid-sized businesses– further broadening their commercial relevance in an evolving media landscape.

Source: EY FICCI M&E Report 2025

Company Overview

Next MediaWorks Limited (NMW), a subsidiary of HT Media Ltd., became part of the broader HT Media Group following its acquisition in CY 2019 – a notable consolidation move even then, within the Indian media and entertainment sector. Along with Next Radio Limited (NRL), the Company has been a pioneer in private FM broadcasting, operating under the well-established ‘Radio One brand.

Over the years, with a strategic focus on metro and key tier-1 cities, NMW has carved a distinct niche through its differentiated content mix – blending international programming with contemporary and retro formats. This unique positioning underscores the Companys emphasis on innovation, audience-centric programming, and premium urban engagement. Driven by a dynamic and listener-centric strategy, the Company has strengthened its urban radio presence, broadened its media footprint, and reinforced its reputation as a progressive and agile player in Indias evolving radio ecosystem.

*Note: During the fiscal year FY2024-25, Next Radio Limited (NRL), the erstwhile subsidiary company of Next MediaWorks Limited (NMW) issued 21,20,00,453 equity shares of Rs. 10 each to HT Media Limited (HTML) pursuant to HTML using its right to convert the loan it had given to NRL, which was INR 212,00,04,536 (Two Hundred and Twelve Crore Four Thousand Five Hundred and Thirty-Six Rupees) as of December 31, 2024, into equity shares. Consequent to conversion, NRL has become a direct subsidiary (rather than being a step-down subsidiary as was earlier) of HTML w.e.f. February 7, 2025. Accordingly, NMW no longer controls NRL. The stake of NMW in NRL has reduced from 51.40% to 13.53% w.e.f. February 7, 2025.

*The above is in line with disclosures to exchanges by the Company dated February 7, 2025.

Radio One

Radio One proudly holds the distinction of being Indias only dedicated international FM station, offering listeners an unparalleled gateway to global music and culture. In a landscape dominated by regional and Bollywood-focused formats, Radio One has established a distinctive niche by delivering uninterrupted access to the latest international hits, appealing to urban, globally attuned audiences.

Beyond music, the station serves as a cultural bridge, connecting Indian listeners to the global entertainment world. Featuring exclusive interactions with international icons among many like Jason Derulo, Katy Perry, Shaggy, and Kylie Minogue, Radio One brings premium global experiences directly to its audience. Coverage of marquee events such as the Grammys, Oscars, and major international music festivals further enhances its global relevance.

Complementing its music offering, Radio One curates talk segments, digital content, and influencer-led programming tailored to urban sensibilities. Through an active presence on social media, engagement via live events, and a focus on community building, the station has cultivated a loyal and discerning listener base.

In a market saturated with homogeneous formats, Radio One stands apart by delivering a sophisticated blend of international music, contemporary hit radio chartbusters, and retro classics, making it not just a radio station, but a celebration of global lifestyle and sound.

Financial Overview (Consolidated)

Revenue from Operations

Revenue from Operations declining by 21%, stood at INR 30.3 crore in FY 2024-25 from INR 38.4 crore in FY 2023-24, primarily on account of loss of control over subsidiary.

Profitability

Earnings Before Interest, Tax and Depreciation (EBITDA) margin came in at 3.6% in FY 2024-25 from 5.2% in the prior fiscal, mainly on account of decline in revenue for the year under consideration, as a result of loss of control over subsidiary. Profit After Tax (PAT) saw an increase due to exceptional items gain recorded on loss of control over subsidiary, increasing to INR 53.9 crore in FY 2024-25 from INR -38.7 crore in FY 2023-24. Return on Networth for FY 2024-25 and FY 2023-24 could not be ascertained due to negative net worth of the Company.

Earnings per share

Earnings per Share (EPS) increased to INR 9.5 in FY 2024-25 from INR -3.3 in FY 2023-24. This was due to an increase in profitability through exceptional items gain recorded on loss of control over subsidiary.

Debtors Turnover Ratio

Debtors Turnover Ratio increased to 4.6 times in FY 2024-25 from 2.8 times in FY 2023-24, driven by a sharp decline in trade receivables relative to operating revenue on account of loss of control over subsidiary.

Inventory Turnover Ratio

Inventory Turnover Ratio could not be ascertained as the Company does not hold inventory.

Interest Coverage Ratio

Interest Coverage Ratio slightly increased to -0.2 times for FY 2024-25 as compared to -0.3 times in the prior fiscal, owing to improvement at EBIT level and decline in finance costs; impacted by loss of control over subsidiary.

Current Ratio

Current Ratio decreased to 0.4 times in FY 2024-25 from 2.6 times in FY 2023-24. This is due to change in current assets & liabilities arising from loss of control in subsidiary.

Debt Equity Ratio

Debt Equity Ratio could not be ascertained for both fiscal years FY 2024-25 and FY 2023-24 due to negative shareholders equity.

Debt Service Coverage Ratio

Debt Service Coverage Ratio stood at -0.3 times in both the years for FY 2024-25 and FY 2023-24 as improvement at EBIT level offset decrease in interest on borrowing; impacted by loss of control over subsidiary.

Trade Payables Turnover Ratio

Trade Payables Turnover ratio increased by 4.9 times in FY 2024-25, as compared to 3.0 times in FY 2023-24, due to relatively lower reduction in purchases as compared to drop in trade payables for the fiscal year under consideration; on account of loss of control in subsidiary.

Net Capital Turnover Ratio

Net Capital Turnover Ratio decreased to -216.6 times in FY 2024-25 from 2.1 times in FY 2023-24, driven by decline in overall current liabilities and assets; arising from loss of control in subsidiary.

Asset Turnover Ratio

Asset Turnover Ratio increased to 0.8 times in FY 2024-25 from 0.5 times in FY 2023-24, which was led by decline in total assets due to loss of control in subsidiary.

Return on Capital Employed

Return on Capital Employed decreased to -50.8% in FY 2024-25 from -7.6% in FY 2023-24, owing to effective change in overall capital employed on account of loss of control of subsidiary.

Return On Assets

Return on Assets increased to 657.0% in FY 2024-25 from -28.1% in FY 2023-24, on account of decline in total assets due to loss of control in subsidiary.

Marketing Initiatives

Next MediaWorks (NMW) has consistently placed marketing and brand-building at the heart of its growth strategy, leveraging a mix of strategic partnerships, flagship content, and live event integration to enhance visibility and deepen audience engagement.

Under its flagship platform, Radio One International, the Company has established a strong presence in the live events and pop culture ecosystem, collaborating on high-impact initiatives such as: Get Some Sun (Season 8 featuring Ayushmann Khurrana); The Laughology Project; Forever Rock; partnerships with global icons including Travis Scott, Coldplay, Ed Sheeran, Dua Lipa, Maroon 5, Bryan Adams; association with marquee festivals like Lollapalooza.

To further expand reach and audience affinity, the Company has launched a slate of new on-air shows tailored to diverse urban interests, including Hrishi K Approved, On A High, Health Hustle, E-sports Frequency, and Caller Connect.

In line with evolving consumption trends, Radio One has significantly scaled its digital-first intellectual properties (IPs), with a strong focus on online platforms. Its official YouTube channel has crossed 1 million subscribers*, reflecting successful platform-led engagement and content innovation.

These multi-platform marketing efforts underscore a commitment to audience-centric storytelling, cross-channel brand amplification, and staying ahead in a rapidly transforming media landscape.

*Source – As per YouTube Analytics

Human Resource

The Company firmly believes that its people are its greatest asset and is committed to fostering a dynamic and inclusive workplace that values diversity, promotes continuous learning, and prioritizes well-being. By focusing on talent acquisition, employee development, and management, the Company works to ensure that it remains an employer of choice, attracting top talent and creating a high-performance environment that contributes to overall growth.

Next MediaWorks Ltd. prioritizes strong employee engagement and professional fulfilment through a variety of strategic employee focused initiatives. There is relevant emphasis on leadership connects, open communication, cross functional engagements and personnel development opportunities.

The Company also offers organizational value-oriented workshops, which use gamification to engage employees and reinforce key principles, and a dedicated middle management training programs that equips managers with the skills needed to lead their teams effectively. The Company and its investee company (i.e. Next Radio Ltd.), together has 46 employees as on March 31, 2025.

Safety of Women at Workplace

In line with the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act and Rules, 2013, NMW has implemented a comprehensive Prevention of Sexual Harassment (POSH) policy. The Company is deeply committed to fostering a workplace that is not only safe but also inclusive, respectful, and supportive of the well-being of all employees, irrespective of gender. This policy is designed to ensure that every employee can work in an environment free from harassment, discrimination, or any form of inappropriate behavior.

As part of its commitment to creating a respectful workplace, NMW provides regular training and awareness programs for all employees, emphasizing the importance of respect, dignity, and equal opportunities. The Company actively promotes a culture where everyone understands their rights and responsibilities under the POSH Act, creating an atmosphere of accountability and transparency. In addition, the Company has established clear reporting mechanisms, including confidential channels, to ensure that employees can report any incidents of harassment without fear of retaliation. In the fiscal year FY 2024-25, NMW received no complaints of sexual harassment, reflecting its dedication to providing a secure workplace for women. This outcome underscores the effectiveness of the Companys policies and its unwavering commitment to maintaining a safe and supportive environment for all employees.

Risk Management

Next MediaWorks has implemented a robust risk management framework to proactively identify, assess, and mitigate risks stemming from both internal and external factors. The Company conducts regular risk identification exercises to monitor potential threats across key areas including financial operations, sectoral developments, sustainability, information security, and cyber risk. Each identified risk is carefully evaluated based on its likelihood and potential impact. Key risk factors include the rapidly evolving advertising landscape with the emergence of new digital platforms, the dynamic regulatory environment, and the ongoing challenge of attracting and retaining skilled talent.

To mitigate these risks, Next MediaWorks has embedded risk management into its strategic decision-making processes. The Company has diversified its content offerings – launching innovative formats such as audio dramas and celebrity-driven shows – to reach broader audiences and stay ahead of competitive pressures. Pricing strategies have been redefined to enhance revenue realization, while the wide portfolio of HT Groups radio brands is leveraged to maintain a distinctive market presence. The Company has also expanded its footprint in the digital and social media space and scaled up events across cities and genres to unlock additional monetization opportunities.

On the talent front, Next MediaWorks promotes employee engagement through regular leadership townhalls, one-on-one interactions, and skill-building initiatives using AI-driven platforms. Incentive structures reimagined to foster higher performance and employee motivation. In response to the fast-changing regulatory environment, the Company maintains high standards of governance through broad deployment of key policies, including the Code of Conduct, POSH compliance, and a functioning Internal Complaints Committee. A dedicated legal and secretarial team, supported by automated compliance monitoring tools and a concurrent review mechanism, ensures full statutory compliance and reduces exposure to regulatory risk. These efforts reflect the Companys commitment to resilient, transparent, and forward-looking governance.

Internal Audit

The Company has an effective system of internal controls corresponding with its size, nature of business and complexity of operations. The internal controls mechanism comprises of a well-defined organizational structure with clearly laid out authority and responsibility matrix and comprehensive policies, guidelines and procedures governing the operations of respective functions. These controls have been designed to safeguard the assets and interests of the Company and its stakeholders and also ensure compliance with Companys policies, procedures and applicable regulations. The Company has an established Code of Conduct (CoC) framework and Whistle-blower mechanism, which is duly approved by the Board of Directors in compliance with the regulatory requirements. A designated CoC Committee with cross-functional representation is in place tasked with monitoring and review of whistle-blower complaints and ensuring proper & transparent complaint management and reporting, including reporting to the Audit Committee, wherever applicable.

The Company has a strong focus on technology and establishment of appropriate automated controls to further enhance the existing control framework. A robust ERP system is used for accounting across functions.

The Company operates through a Shared Service Centre (SSC), the ambit of which is being continuously widened to aid centralization of processes and activities. These systems enhance the reliability of financial and operational information by facilitating system driven control activities, reducing manual intervention, segregation of duties and enabling stricter controls. The internal control system is supplemented by an extensive program of operational and IT audits to evaluate the adherence to laid down processes and controls on a periodic basis. The in-house internal audit function supported by professional external audit firms conducts comprehensive risk focused audits and assess the effectiveness of the internal control structure across functions on a regular basis. A Group level central Revenue Assurance function is also in place to further streamline and enhance the controls around revenue recognition across different revenue streams. In addition to internal audit activities, Company has also developed an internal financial control framework to periodically review the effectiveness of controls laid down across all critical processes. The Company performed an extensive operating effectiveness testing of its Internal Financial Control (IFC) framework, including rationalization of existing controls in line with dynamic business practices. The Company also uses a workflow based online compliance management tool and has established a concurrent audit mechanism of the same to ensure effective compliance oversight. Further, the Company has an Audit Committee which meets once in every quarter to review internal control systems, accounting processes, financial information, internal audit findings and other related areas including their adequacies.

Way Ahead

Following the settlement of borrowing led realignment of the Company structure during the fiscal year FY 2024-25; Next MediaWorks Ltd. will recalibrate its strategic priorities, keeping a balanced, stakeholder-centric approach.