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MUMBAI: The media and entertainment sector is attracting serious
doses of equity financing as it has entered the early phase of consolidation,
experts at the Ficci-Frames 2007 said here today.
Major media groups are expanding beyond their core areas both in
terms of segments and geographies, according to Ernst &Young
transaction advisory services associate director Mukesh Jain.
Zee Group, for instance, is entering into the print space while the
appetite to go into new territories is evident with Deccan Chronicle
launching new editions in the southern states.
"Investors are keenly eyeing or are already investing in digital
media. TV broadcasters are getting into new ventures and finer segments.
On the content front, we are seeing international formats and special
niche genre programming," said Jain while speaking on "Financing
option and valuation of the entertainment industry."
Though the opportunity to raise money is easy, private equity funds
are looking at track records and implementation of the business
plan. "Investors had burnt money during 2000-2005. With the
India growth story catching on, there is a renewed interest in the
media and entertainment sector as we are going o witness a second
large influx of new broadcasters like NDTV's foray into the general
entertainment space. Film financing and trading will also attract
investment," said Ambit Corporate Finance CEO Ashok Wadhwa.
Media and entertainment companies, however, should not tap the
market at an early time with the hope of riding on a buoyant stock
market. "There should be an air of caution and media companies
should not repeat the mistakes of 2000-'01," he added.
Moderating the session, Blackstone Advisors India MD and chairman
Akhil Gupta said issues of corporate governance were matters of
concern with private equity financiers. "We decided against
a few deals because we felt the promoters couldn't take their companies
to the next level of growth. Valuation, of course, is the trickiest
issue," he added.
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