Times Internet’s Gaana was acquired by Times Group’s subsidiary Entertainment Network India Limited (ENIL) in December 2023 for Rs 25 lakh. The move followed potential merger and acquisition talks with Airtel Wynk which fell through. Gaana was acquired by ENIL for a lump sum cash consideration of Rs 25 lakh, as per the company’s exchange filings. ENIL is the operator of FM radio channel Radio Mirchi.
During the recent earnings call, ENIL CEO Yatish Mehrishi said, “Non-FCT segments, including digital, witnessed a growth of 43.6% year-on-year on the back of subscription revenue from Gaana… As we had a promising improvement post integration of Gaana. During the quarter, we launched the improved version of the previous app, which was well received. This led to a strong digital revenue of Rs 17.8 crores, contributing almost 25% of our radio revenues as compared to 11.8% in Q1 FY ’24.”
ENIL also made investments on this new platform, which is close to Rs 15 crore this quarter, the company said.
Mehrishi added during the call, “We’re looking at investment and our aim is to make Gaana business profitable as soon as possible.”
Giving an insight into how ENIL envisages Gaana, which they took over on December 1, 2023, Mehrishi said, “We have gone ahead and done a pure subscription business. So, it’s not a free music business, unlike what Gaana erstwhile used to do or what Spotify does right now or what JioSaavn does. Our business is a pure subscription model.”
He added, “Our pricing earlier used to be Rs 299, which was not feasible. But recently, you would have seen from 1st July, we have increased the price to Rs 599. As you look at any business, any new digital investment requires certain bit of incubation period, so we’ll be investing for another couple of years into the business, into the product, into the product experience or recommendation engine, acquiring more and more subscribers.”
Entertainment Network (India) Ltd, recently announced its results for the First Quarter ended June 30, 2024. Domestic revenues for Q1 FY25 were Rs 109.4 Crores, representing a 19.3% YoY increase. This broad-based growth was driven by both the radio and digital segments.
In Q1 FY25, EBITDA (excluding digital) was Rs 20.5 Crores, up from Rs 19.2 Crores in Q1 FY24. Profit After Tax (PAT) rose to Rs 5.8 Crores, compared to Rs 4.4 Crores in the same period last year.
Digital revenues reached Rs 17.8 Crores, constituting almost 25% of radio revenue, up from 11.8% in Q1 FY24. The international market remained EBITDA positive.
ENIL’s consolidated revenues for Q1 FY25 were Rs 113.5 Crores, reflecting an 8.9% year-on-year growth.
ENIL, a subsidiary of Bennett, Coleman & Company Limited (BCCL), the flagship company of the Times of India Group, was incorporated in 1999. ENIL operates in radio broadcasting under the brand Mirchi.
Mehrishi, CEO of ENIL, said: “…we have continued the growth momentum from previous year. The new Gaana app has been well-received, and our digital segment is poised for further growth. The initial investment in the new platform is stabilizing, and we anticipate sustained progress moving forward.”