Star India incurs Rs 12,548 crore net loss in FY24, cites ICC contract as reason

Star India's operating revenue reduced by more than 6 percent to Rs 18,587 crore in FY 24 from Rs 19,812 crore in FY 23

By  Storyboard18Nov 13, 2024 1:34 PM
Star India incurs Rs 12,548 crore net loss in FY24, cites ICC contract as reason
Star India's standalone net profit was Rs 1,465 crore in FY 23

Star India, which is in the final stage of a merger with Viacom18, incurred a standalone net loss of Rs 12,548 crore for FY 24. The company's standalone net profit was Rs 1,465 crore in FY 23.

The operating revenue reduced by more than 6 percent to Rs 18,587 crore in FY 24 from Rs 19,812 crore in FY 23. The company's advertising revenue dropped by 4 percent to Rs 10,736 crore. The subscription revenue decreased by over 1 percent to Rs 6,909 crore.

According to a report by the Economic Times, the broadcaster attributed the poor financial performance to the ICC contract. In a regulatory filing, Star India said, "The company has estimated the contract with ICC, to be onerous as the expected revenue from customers relating to this right as and when the related event is broadcasted/ streamed is likely to be less than the cost involved in broadcasting and streaming these events and hence has estimated a loss from future events relating to these media rights to be Rs 12,319.31 crore as of March 31 2024".

Star India acquired the ICC TV and digital rights for $3 billion for a four-year period till 2027.

Later, the company sub-licensed the TV rights to Zee Entertainment, which eventually decided against proceeding with the deal after the collapse of its merger pact with Sony Group Corp's India units in January.

Zee did not get permission for investment in ICC rights due to financial constraints. Later, Star India initiated arbitration proceedings against Zee at the London Court of International Arbitration, seeking $940 million in damages.

However, Zee refuted Star India's claims stating that the arbitration process was in its early stages and LCIA had yet to determine the company's liability.

The expenses of the broadcaster surged by over 68 percent to Rs 31, 548 crore from Rs 18,724 crore due to the provision for the contract.

Separately, Star has also filed an application on 30 September with the NCLT, Mumbai for the amalgamation of Star Television Production Limited (STPL). Currently, Star India owns and operates 77 TV channels across entertainment, sports, and kids' categories. Its streaming platform, Disney + Hotstar, previously managed by Novo Digital Entertainment, has now been integrated into Star.


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    First Published on Nov 13, 2024 1:34 PM

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