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H T Media Ltd

| Q3 FY26 Earnings Conference Call

NEUTRAL SENTIMENT

Report Source

⬤4th Feb 26

Summary : HT Media delivered stable Q3 FY26 results, driven by resilient Print and strong Digital performance, while navigating Radio market challenges and potential newsprint cost increases.

Management Perspective positive : Management consistently used phrases like 'consistent operational progress,' 'steady growth in overall profitability,' 'strong performance,' and 'sustaining the momentum' when discussing results and future outlook.

Concall Report Analysis & Insights

Business Overview

  1. Q3 FY26 saw consistent operational progress with stable topline and steady profitability growth.
  2. Core Print segment demonstrated resilience, driven by strong advertising growth in English titles and steady circulation.
  3. Radio business navigated a challenging market, with revenues and margins under pressure, but stable sequentially.
  4. Digital business delivered strong performance, with revenues rising 30% year-on-year and improved margins.
  5. Consolidated revenue was INR 532 cr (flat yoy, 7% sequential growth), with EBITDA at INR 51 cr (10% margin, 9% yoy improvement).

Future Growth Prospects

  1. Company focuses on sustaining momentum across its business portfolio by leveraging Print mastheads.
  2. Plans include recalibrating Radio offerings and scaling up new-age digital platforms for content delivery.
  3. AI is viewed as an enabler to expand offerings and a potential revenue opportunity, not just cost efficiency.
  4. Government proposals for platforms to compensate original content creators for AI data could be positive.
  5. Company has reasonable newsprint cover until Q1 next year, expecting upward move thereafter.

Management Insights

  1. Chairperson highlighted consistent operational progress, stable topline, and steady profitability growth in Q3 FY26.
  2. Management emphasized the effectiveness of ongoing operational initiatives to strengthen businesses.
  3. Disciplined approach to costs has translated into meaningful growth in profitability.
  4. Proactively recalibrating Radio operations to align with current industry dynamics.
  5. Committed to delivering trusted journalism and high-quality content across diverse audiences.

Signs of Skepticism

  1. Analyst questioned the consistency of 'forfeiture' revenue, suggesting it might be a one-time event.
  2. Analyst expressed skepticism that AI would lead to massive editorial staff cost reductions as expected.
  3. Analyst questioned if the INR 39.9 cr gratuity booking would be adjusted in CTC next year, implying cost absorption concerns.

Risk Factors

  1. Radio business continues to face a challenging market environment with revenue and margin pressure.
  2. Potential for newsprint prices to increase in coming quarters due to geopolitical scenario.
  3. Increasing cover prices, especially in Hindi markets, is a tougher proposition.
  4. New labor code impact on gratuity is an evolving regulation for all companies.
  5. Analyst noted dismal stock performance and limited revenue growth post-COVID.

Good To Know

  1. Other operating revenue uptick includes job work, scrap sales, and forfeiture from AFE business.
  2. HT English profitability improved due to pricing growth, lower newsprint costs, and controlled discretionary spends.
  3. HMVL staff cost reduction was partly due to variable payout reversal and savings in other business lines.
  4. An exceptional item of INR 41.4 cr was booked for gratuity due to a true-up based on new labor code.
  5. Ad pricing is seeing an uptick both year-on-year and sequentially.

Key Drivers

  1. Digital segment scaling up.
  2. AI content compensation framework.
  3. Print ad revenue growth.
  4. Disciplined cost management.

Key Analyst Discussions

Competitive Environment

  1. Analyst noted competitive pressure in the Print segment last year impacting pricing.

Financial Highlights

  1. Questions on Print segment's revenue uptick, specifically other operating income components like forfeiture and outside printing.
  2. Inquiries about the drivers behind HT English's improved operating profit, including pricing and cost reductions.
  3. Questions regarding the reduction in HMVL staff costs compared to the previous year.
  4. Discussions on ad pricing trends, noting an uptick year-on-year and sequentially.
  5. Queries about newsprint rates, potential increases, and company's mitigation strategies.

Strategic Considerations

  1. Questions on the company's current and future use of AI across businesses and its financial impact.
  2. Inquiries about potential deals with Meta or AI companies for content compensation.
  3. Analyst questioned company's active pursuit of AI-related revenue opportunities given stock performance.
H T Media Ltd (HTMEDIA) Concall Report Analysis & Insights | Dhanarthi