M&E sector likely to grow 12-14%, touch Rs 1.6 lakh cr revenue in FY24

New Delhi: Indian media and entertainment sector is likely to grow 12-14 per cent to clock Rs 1.6 lakh crore revenue in FY24, rating agency Crisil said in a report.

The revenue growth of the Indian media and entertainment (M&E) from advertising would be led by digital platforms, followed by TV and print, it added.

"Ad revenue, which accounts for 55 per cent of the sector's revenue, will grow 14 per cent, given its strong correlation with economic activity. Also, the general elections expected in mid-2024 will trigger an increase in ad spending in the last quarter of the next fiscal," Crisil said.

The rest 45 per cent would come from subscription revenue, which will grow at a slower pace of 12 per cent, according to the report.

Crisil Rating Director Naveen Vaidyanathan said: "While TV will continue to dominate ad revenue share given its wider reach, digital will lead in growth, rising 15-18 per cent annually over the medium term".

Digital has emerged as the medium of choice in the past few years amid accelerated adoption of over-the-top (OTT) platforms, online gaming, e-commerce, e-learning, and online news platforms, he said.

"After the pandemic, digital has become the second-largest segment after TV in terms of ad spends. Together, they account for over three-fourths of the ad revenue for the M&E sector, followed by the print segment with a one-fifth share," Vaidyanathan added.

Besides, the print media will also see "healthy" ad revenue growth of 15 per cent next fiscal.

However, it said, the print media ad revenue "would still trail the pre-pandemic level by 800-1,000 basis points. That is because of slow recovery in ad yields, especially for English editions".

Other hyperlocal media, such as radio and outdoor, could reach pre-pandemic levels next fiscal spurred by increased commuting as well as higher ad budgets for micro, small and medium enterprises, the key drivers for these segments.

Over the film exhibition, Crisil said its non-ad revenue such as theatre collections, which was the most affected by Covid-19, may surpass pre-pandemic levels with significant growth of 30 per cent in FY24 after making a strong comeback this fiscal.

"The addition of screens amid rising occupancy will support the growth. Subscription revenue growth for TV and print would be driven by moderate improvement in realisations in preference towards digital medium in the long term," it said.