In the fiscal 2016-17, rural India is all set to emphasize its authority over the media and entertainment segment by pushing the ad spends and the viewership numbers further, claims a report by India Ratings and Research that is a Fitch affiliate. This sector is believed to grow by 10 percent to 12 percent with the digital media surpassing the traditional forms growing by a whopping 50 percent in the next fiscal in comparison to the current fiscal. The advertisers will be attracted toward the sector’s increasing rural as well as semi-urban sweep with e-commerce and automobile contributing the maximum revenues. The telecom sector could play a huge role if the 4G promise holds up.
An analyst with India Ratings, Tanu Sharma, who co-authored the report along with Rakshit Kacchal stated that these are under-penetrated markets. The next wave of the consumption is likely to come arrive from there and advertisers will be very interested. The players have to look for ways to push their profit margins. The broadcasters have to tackle the last mile structural troubles. The traditional media has to focus on sidestepping the dominant shadow of digital dominance.
This report bets on the enhanced GDP growth predictions that are expected to be a major contributor for the higher advertising spends in the next fiscal. For print, the vernacular offerings will witness the maximum increase in the ad revenues.
As per the report, the advertisement revenues will be robust for the regional players of print media. The report does not split the ad revenue numbers of all the media players, but it says that the vernacular or Hindi print media’s advertising revenue will grow by 13 percent to 15 percent.
The broadcasters are expected to gain from digitization and it is expected to be the main revenue growth driver in the next fiscal. The profitability margins will increase in the next fiscal.
As per the report, the cinema business will witness a sharp increase in the overall number of screens in the next fiscal and this will be centered in the tier 2 and tier 3 cities. The industry is likely to see 135 screens this fiscal and 600 screens in the fiscal ending March 2018.