RADIOCITY - Music Broadcast

📊 NSE: RADIOCITY 🏢 Entertainment / Electronic Media Software 📅 Last Updated: 12/14/2025 10:09

💰 Financial Performance

Revenue Growth by Segment

Total revenue for Q2 FY26 was INR 37.8 Cr, while H1 FY26 reached INR 87.2 Cr. Alternate revenue streams (branded properties, digital, events) contributed 34% of total income. Digital revenue specifically accounted for 7% of overall ad sales revenue in Q2 FY26. Historically, FY25 revenue was INR 235 Cr, a 2.6% increase from INR 229 Cr in FY24, driven by digital and non-FCT segments.

Geographic Revenue Split

The company operates 39 stations across India with a strong presence in Tier 2 and Tier 3 cities. While specific regional % splits are not disclosed, the network has moved to an asset-light model with 13 live stations and 26 virtual stations to optimize regional content delivery.

Profitability Margins

Operating profitability declined to 12% in FY25 from 16% in FY24 due to increased employee expenses for digital expansion. Q2 FY26 adjusted PAT was negative INR 4.6 Cr after accounting for INR 2.3 Cr interest on NCRPS. Net profit in FY23 was INR 3 Cr (1.5% margin) compared to a loss of INR 5.7 Cr in FY22.

EBITDA Margin

Operating EBITDA for Q2 FY26 was INR 1.4 Cr (3.7% margin), significantly impacted by subdued demand as advertisers deferred campaigns. H1 FY26 EBITDA stood at INR 9.3 Cr (10.6% margin). The company aims to improve this through a cost reduction of INR 6-7 Cr per quarter.

Capital Expenditure

Capital expenditure is expected to remain moderate as the company shifts toward an asset-light 'hub-and-spoke' model, virtualizing 26 out of 39 stations to reduce physical infrastructure needs.

Credit Rating & Borrowing

CRISIL AA+/Stable/CRISIL A1+ (factoring in parent JPL linkages). Liquidity is strong with cash and liquid investments of ~INR 349 Cr as of March 31, 2025, against preference share redemptions of ~INR 108 Cr due at the end of FY26.

⚙️ Operational Drivers

Raw Materials

Content and Music Royalty Rights (100% of core programming input). Royalties are paid to bodies like PPL and record labels like Super Cassettes Industries Ltd.

Import Sources

Domestic (India-based music labels and copyright societies).

Key Suppliers

Phonographic Performance Ltd (PPL), Super Cassettes Industries Ltd (T-Series), and various independent artists via the Muzartdisco platform.

Capacity Expansion

Currently operates 39 radio stations and 17 web-based stations. Expansion is focused on 'virtual' reach rather than physical stations, with 26 stations now operating virtually to maintain deliverables while lowering overhead.

Raw Material Costs

Royalty rates are a significant cost; the Copyright Board previously fixed standard rates at INR 1,200 per needle hour during prime time, with 60% of that for normal hours and 25% for lean hours.

Manufacturing Efficiency

Inventory utilization stood at 74% in Q2 FY26, an improvement from 70% in the previous year, indicating better monetization of available airtime.

Logistics & Distribution

Distribution is digital/RF-based; costs are being reduced by rationalizing 10-15% of headcount and optimizing programming from 4 shows to 3 shows in non-top markets.

📈 Strategic Growth

Expected Growth Rate

Growth Strategy

Achieving growth through a cost-reduction program of INR 24-28 Cr annually, aggressive selling of 'Radio + Digital' bundled solutions, and focusing on the 34% revenue contribution from non-radio segments like branded events and proactive pitches.

Products & Services

FM Radio broadcasting, Digital advertising solutions, Branded properties/events, Podcast platforms, and Influencer marketing partnerships.

Brand Portfolio

Radio City, Radio Mantra, RC Studio, RC Swapper, Muzartdisco.

New Products/Services

Radio plus Digital combined solutions; 'virtual' station content delivery; and reworked influencer marketing models (SMINCO) expected to drive sustainable profitability.

Market Expansion

Focus on Tier 2 and Tier 3 cities where parent company Jagran Prakashan Ltd (JPL) has strong print reach, creating cross-media synergies.

Market Share & Ranking

18% volume market share in Q2 FY26; ranked as the second-largest radio player in India.

Strategic Alliances

Partnership model for influencer marketing via SMINCO and synergies with parent JPL for liquidity and operational support.

🌍 External Factors

Industry Trends

The radio industry saw 3% YoY volume growth in Q2 FY26. However, the sector faces headwinds from digital migration, leading to price-led competition and a need for revenue diversification into events and digital ventures.

Competitive Landscape

Intense competition from other private FM players and increasing pressure from digital platforms like streaming and social media.

Competitive Moat

Moat is built on the 39-station network and the 'Radio City' brand, which attracts 42% of the industry's client base. Sustainability is supported by the financial backing and geographical reach of parent JPL.

Macro Economic Sensitivity

High sensitivity to GDP; ad volumes slowed in Q2 FY26 as advertisers deferred campaigns in anticipation of GST-related benefits.

Consumer Behavior

Shift toward digital consumption has forced the company to rationalize digital initiatives and move toward a 'virtual' station model to maintain audience reach at lower costs.

Geopolitical Risks

Minimal, as operations are focused on the Indian domestic advertising market.

⚖️ Regulatory & Governance

Industry Regulations

Governed by FM Phase III auction norms and the Copyright Act 1957. Compulsory licensing under Section 31(1)(b) is critical for managing music royalty costs.

Environmental Compliance

Not a significant factor for radio broadcasting.

Taxation Policy Impact

Impacted by GST transition; advertisers deferred spending in Q2 FY26 leading up to GST benefit announcements in September.

Legal Contingencies

Ongoing litigation among promoters could impact the credit risk profile. Legal disputes with Phonographic Performance Ltd (PPL) regarding royalty rates and compulsory licensing are active.

⚠️ Risk Analysis

Key Uncertainties

Susceptibility to economic cycles (ad revenue volatility) and the outcome of promoter litigation. Digital segment growth may continue to cannibalize traditional radio margins.

Geographic Concentration Risk

Diversified across 39 cities, but heavily reliant on the Indian macroeconomic environment.

Third Party Dependencies

High dependency on music labels for content; 100% of on-air music requires third-party licensing.

Technology Obsolescence Risk

Traditional FM is at risk from digital streaming; company is mitigating this by converting 67% of stations to a virtual model and integrating digital ad sales.