The Broadcast Audience Research Council (BARC), India’s leading TV audience measurement organization, has reported a sharp 44% decline in profit after tax for FY24, with earnings dropping to ₹20 crore. The decline in profits comes despite a marginal 0.6% dip in revenue, which fell to ₹319 crore compared to ₹321 crore in FY23, reflecting the pressures the organization faces in a rapidly changing media environment.
BARC’s financial model is largely driven by broadcasters, who contribute 75% of the company’s revenue through fees tied to advertising revenues. This model ensures consistent cash flow, as clients are billed quarterly in advance. However, the organization’s heavy reliance on this segment and the increasing competitive and regulatory pressures may have contributed to the decline in profitability.
MDPL, the company responsible for managing BARC’s data collection infrastructure, also faced a significant setback, recording a 60% decline in net profit, dropping to ₹2 crore for FY24. Revenue for MDPL also saw a slight dip of 2%, amounting to ₹105 crore. MDPL operates a network of 55,000 Bar-O meters and 2,500 out-of-home meters across urban and rural India, playing a key role in audience measurement.
Despite the profit drop, BARC’s financial risk profile remains strong, supported by ₹100 crore in cash reserves as of September 30, 2024, and minimal debt levels of ₹5 crore. The company plans to fund future capital expenditures using internal accruals and its existing reserves.
CRISIL has reaffirmed its stable rating for BARC’s long-term bank facilities, projecting operating profits in the range of ₹20-30 crore for the near future. However, it highlighted the risks stemming from potential regulatory changes, particularly those arising from the Ministry of Information and Broadcasting’s ongoing review of TV audience measurement guidelines, which TRAI had recommended in April 2020. The firm also noted the significant capital requirements and regulatory barriers that continue to challenge the industry.
While BARC’s role remains crucial to the Indian TV broadcasting sector, influencing advertising decisions and audience analytics, the company’s trajectory will likely be shaped by the evolving regulatory landscape and competitive dynamics in the industry.
Key Highlights:
- BARC’s profit after tax dropped by 44% to ₹20 crore for FY24, with a slight dip in revenue.
- The company’s business model is reliant on broadcasters, who contribute a significant portion of its income.
- MDPL, responsible for data infrastructure, also reported a 60% fall in profits for FY24.
- BARC retains strong cash reserves and low debt, ensuring financial stability despite challenges.
- CRISIL’s stable rating reflects optimism for BARC’s future, despite regulatory pressures and high capital requirements.