Media and entertainment conglomerate Star India ended FY2019 with a loss of ₹1,216 crore compared to a net profit of ₹287.7 crore a year ago, according to its recent filings with the registrar of companies (RoC), as first reported by The Economic Times.
The company that recorded expenses of ₹4,000 crore on its marquee sports property, the Indian Premier League (IPL), suffered these losses despite a 35% increase in revenues during the year.
The company’s total revenue from operations stood at ₹12,341 crore in FY19 compared with ₹9,149 crore a year ago. This includes advertising revenues of ₹7,311 crore, up 49%, and distribution revenue of 4,128 crore, up 9%. Revenue from other sales and services doubled to ₹902 crore, according to the ET report.
Total expenditure also jumped 58% to ₹13,707 crore from ₹8,694 crore a year ago. The spike in costs may be primarily attributed to a 66% increase in programming and operating cost to ₹10,296 crore, a 34% jump in employee cost to ₹1,198 crore, and a 57% jump in marketing cost to ₹1,168 crore.
The loss comes only a few weeks after the exit of Sanjay Gupta, former Star and Disney India managing director who has joined Google India as country manager and vice-president of sales and operations for the country.
As far as new offerings go, India awaits the streaming of Disney+ content on Star’s video-on-demand platform Hotstar soon. Walt Disney that launched the ad-free video streaming service in the United States earlier this month, will route the original content created for the new OTT service and its movie library to Indian audiences through Hotstar.
Walt Disney had acquired Rupert Murdoch’s 21st Century Fox Inc. in a $71 billion cash and stock deal in June 2018. That makes Star India, Fox Star Studios and Hotstar in India, a part of Walt Disney.
Disney+ has debuted with content bundled from Disney, Pixar, Marvel, Star Wars and National Geographic. Priced at $6.99 per month and $69.99 per year in the US, the service launched with nine original shows like space western The Mandalorian that is set in the Star Wars universe, documentary series The World According to Jeff Goldblum, mockumentary High School Musical: The Musical: The Series, besides movies like Lady and the Tramp, Noelle, Purl, Float and Kitbull. Classics such as Snow White and the Seven Dwarfs, Miracle on 34th Street, Cinderella, Alice in Wonderland, Recess and the X-Men animated series are also available.
In India, Star plans to continue with its current subscription plans—Hotstar Premium at ₹299 per month and ₹999 per year and Hotstar VIP at Rs. 365 per year, even after the launch of Disney+.