D B Corp Ltd Q4 FY2024 Concall Summary

Key Takeaways

• Election-year advertising surge masks underlying growth: Total ad revenue grew 18–19%, but roughly 9 percentage points came from election-related spending. Excluding elections, the core business grew ~10%, a pace management says it must work harder to sustain.
• Newsprint tailwind persists, but no forward visibility: Newsprint costs fell 14% YoY in FY24, with a further ~4% decline expected in Q1. Management declined to forecast beyond that, calling it a commodity nobody can predict.
• Circulation erosion continues, with a plan to reverse it: Circulation dropped ~2.5% to ~41 lakh copies, driven by losses in hotels, offices and rural markets. The company is targeting growth this year by recapturing post-COVID losses in offices and hotels, and reaching new high-rise households.
• Digital is growing users but not yet disclosing revenue: The app reached ~1.4 crore users while competitors declined 30–60%, and Uttar Pradesh expansion is showing early traction. Management declined to provide any digital revenue figures or medium-term revenue outlook.
• What to watch next quarter: Whether circulation stabilizes or grows, the pace of core (ex-election) advertising growth as the election cycle ends, and any disclosure of digital revenue contribution.

Advertising: The Election Bump and What Remains

• Headline growth was election-driven: Total advertising revenue grew 18–19% for the year, but government and political spending (normally 15–16% of ad revenue) shot up to 25%, contributing roughly 9 percentage points of that growth.
• Core growth at 10%: Excluding election revenue, underlying advertising grew at a double-digit rate that management explicitly flagged as the baseline it must work harder to sustain going forward.
• Category-level momentum is broad but uneven: Real estate, education, jewellery, healthcare and government all invested significantly. Automobile grew almost 30% for the full year but has not yet returned to pre-pandemic levels. Jewellery grew double digits, lifestyle grew single digits.
• Ad yields recovered, rates still aspirational: Ad yields have reached pre-COVID levels, but management noted that in the ad space, rates always leave much to be desired.
• Q1 FY25 will be subdued: Management cautioned that Q1 will be good but not substantially good, with market activity resuming from June onwards after the election period.

Girish Agarwal: "So I think color is very clear out of our 18% - 19% growth almost, I would say, 9% growth has come because of the election year and such. If I take that out, I'm almost at 10% growth apart from the election revenue. So that's the number, which is our double-digit number, we must work harder to achieve that same going forward, also."

Circulation: A Managed Decline with a Turnaround Thesis

• The 2.5% drop: Circulation fell from ~42 lakh copies to ~41 lakh copies, attributed to three structural post-COVID losses: offices that cut newspapers as a cost-saving measure, hotels that stopped providing copies in rooms, and rural market erosion.
• No geographic expansion: The company operates in the same states (Gujarat, Rajasthan, Madhya Pradesh, Chhattisgarh, Haryana, Chandigarh, Bihar, Maharashtra) and has not expanded physical copies into new geographies.
• The recapture strategy: Management sees three pools of potential circulation growth: offices that dropped newspapers post-COVID, hotels that stopped in-room copies, and new nuclear families in high-rise buildings where vendors cannot initially reach.
• No subsidized copies: Unlike pre-COVID, the company now refuses to run circulation schemes or subsidized copies unless they are 100% on cover price, a discipline enabled by high print prices.
• Targeting growth this year: Management stated it is targeting some circulation growth in the current year, though no specific figure was given.

Newsprint: A Fading Tailwind with No Visibility

• The cost tailwind: Average newsprint cost fell from a peak of INR 63,500 per metric ton in Q2 FY23 to INR 49,350 in Q4 FY24, delivering a 14% YoY reduction in newsprint costs for the full year.
• One more quarter of relief: Management indicated newsprint rates may decline a further ~4% in Q1 FY25.
• Beyond that, a black box: When asked about headwinds one or two quarters out, management deflected entirely, stating the commodity is unpredictable and nobody can forecast it.

Girish Agarwal: "So this is a commodity business, nobody can predict."

Digital: Growing Users, Silent on Revenue

• User base has scaled: The app grew from 0.2 crore users in January 2020 to approximately 1.4 crore in March 2024, with monthly active users around 1.5 crore and average time spent of 14–15 minutes.
• Outperforming a shrinking industry: While the broader digital news industry saw MAU declines of 30–60%, D B Corp maintained and slightly grew its user base, a performance management framed as effectively growing 60% relative to peers.
• Uttar Pradesh expansion: The company is taking on Uttar Pradesh in a big way for its digital business and reported very strong traction in the initial months.
• Revenue remains undisclosed: When asked for digital revenue run rate and a medium-term revenue outlook (2–3 years), management provided user metrics and expansion commentary but declined to share any revenue figures or targets.
• Positioned as a future pillar: Digital is described as a strong supplementary pillar of growth, with the omnichannel presence seen as a long-term asset.

Girish Agarwal: "in MAU, we have been able to maintain the number, in fact, grow a little bit, while the industry, all the players have seen a 30% to 60% decline. I think that way, I would call it that we have grown by 60% rather than declining that way."

Radio & Other Segments

• Radio delivered industry-leading EBITDA margins: Management attributed this to strategic investment, strong content focus and engagement events, and expressed confidence the performance is sustainable.
• Radio as part of the omnichannel story: The radio business is positioned alongside digital as a pillar of the company's omnichannel presence, with continued investment planned.

Capital Allocation & Governance

• Interim dividend: The Board recommended an interim dividend of INR 8 per share.
• No forward guidance: When asked for FY25 revenue growth and EBITDA margin outlook, management explicitly declined, stating the company does not give forward-looking assumptions and projections.

Guidance & Commitments

Key Metrics