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Saregama India Ltd
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Ladies and gentlemen, good day and welcome to the Saregama India Q1 FY '23 Earnings Conference Call hosted by ICIC Securities. [Operator Instructions] Please note that this conference is being recorded.
I now hand the conference over to Mr. Bhupendra Tiwary. Thank you and over to you, sir.
Thank you, Seema. On behalf of ICIC Securities, we welcome you all to Q1 FY '23 results conference call of Saregama India. From the management, we have Mr. Vikram Mehra who's Managing Director; Mr. Pankaj Chaturvedi, who's CFO; and Mr. Pankaj Kedia who's Vice President, Investor Relations.
So without much ado, I'll hand over to Vikram. Over to you, Vikram.
Thank you, Bhupendra. Good evening everyone. Quarter one of financial year '23 saw operating revenues of around INR 169 crore and a PAT of INR 41 crore which actually results into around 61% year on year increase in our operating income. And 52% increase in a pat income on a year on year basis. Something we're very, very proud of. Keep in mind this is in continuation with our last year numbers, which I've seen a 31% increase in operating revenue and a 35% increase in pat.
I know I sound repetitive, but I'll again say this, this is not an aberration. Quarter after quarter, you're seeing Saregama's results. They are always moving election. These are steps that are nothing but milestones in Saregama's resurgence story. We started rebuilding the foundation of the company between 2015 and 2018. And what you've seen now is the growth in this beautiful building called Saregama that people love, make a company which not only thrives on the richest IP catalog that it owns, but also a company which is building the IP for tomorrow. So the 30 and 40 years on the line. So Saregama will continue being the number one IP company of India. Our operating income before content charge interest and depreciation was at INR 64.7 crore, which means a 54% growth compared to last year.
As you know right now, our business is broadly divided into three verticals. The most important vertical, which is music business. That grew 38% on a year on year basis in this quarter. Now this is significant, maybe better than most other music labels in India or globally have reported. We grew by 38% on a year on year basis from music business is concern. This comprised both of the licensing, as well as the karaoke business. When we started licensing, we have been going at over 20% on an annual basis, for now over three years, this is the fourth year going on. And I'm very happy that our growth story continues. During this quarter, we released all these songs of the super hits movie of Mahesh Babu called Sarkaru Vaari Paata.
I'm happy to share that the accumulative audio and video views and streams that we have on the Saregama official channel for this movie have crossed 550 million. And this movie was released in the month of April only. It shows multiple things. One, we are picking the right content and then we are putting the right marketing muscle to go out there and make this content really big. And it's not just only large movies that we are picking up. We in fact, released another small film called Ittu Si Baat. And the great thing about that film was that it had songs from Arijit Singh, Jubin Nautiyal, Vishal Mishra. The who's who of the music industry were part of these smaller films. Often music buying is not just based on picking up temporary properties. A lot of thinking goes right now on the back of data modeling to tell us which of the large, medium and small size films music that we should pick up.
And the success is there in front of everyone. We continue also our investments in Bhojpuri, Gujarati, Telugu, Malayalam, Tamil, Bengali and devotional music. I think a song that stands out completely during this quarter, which I'd like to mention is a Bhojpuri song called Nathuniya by Khesari Lal Yadav. That song in this short duration of three months has already crossed 150 million YouTube views. Now this is a massive benchmark for a language which is not the primary language of this country. Bhojpuri is spoken by a large belt in North and Eastern India. And a last song in that language getting 150 million is a big achievement, which also revalidates the fact that we are the number one guys now in Bhojpuri and Gujarati. The strategy of investing a new content is clearly paying off. All the financial numbers I'm sharing with you right now are a testament to that.
It's not only allowing us to grow our share in the new content category space, but in fact it's also helping the growth of catalog because remember people who start following Saregama's social media account, YouTube account, Facebook account on account of the new content called sampling lot of hits of Lata Didi or Kishore Da on our channel. We have raised 750 career with an explicit mandate to invest in new music content. And we are completely on track. As mentioned, we are using data mining and predictive modeling to decide what content to invest in. Many of the films who music that we acquired over the last six months, they hopefully will start really getting released from the fourth quarter of this year.
And a large number may be financially at '23, '24. Some of them are Karan Johar's next directorial film, Rocky Aur Rani Ki Prem Kahani. There's another Dharma film that we're developing called Rola. There's a Vicky Kaushal, Sara Ali's next film with Maddock; Chiranjeevi film which has also a Salman Khan song in it called Godfather. It's a Telugu film. Prithviraj Sukumar who's a Malayalam superstar, his next movie, Kaapa. Ammy Virk, who's a Punjabi superstar, his next film, Oye Makhna. It's a lot of content that we're developing up and these are just some names. The list is very long across film music in Hindi, Tamil, Telugu, Malayalam and now also Kannada and Punjabi.
While the company started investing in new content from 2017 onwards, that's the time we started doing experiments at a small level. The real growth that we are looking at as this becomes serious from this year onwards. It's now that we believe with the fundraising that music acquisition are going to see a significant step jump. That is implications done over the last many months is to reassess our capabilities on multiple fronts.
On the content acquisition side, we have gone out there and reinforced the teams in each of the languages so that people sitting in Bombay are not taking decisions on account of what content to acquire in a Bengali language or other language. They are strong teams, which are deciding under markets whose mother tongue is that language who are taking the calls on what content to pick up. The head office gets involved only from the data analytics perspective, given them enough ammunition about the past track record of the artist whose music they're picking up. So a lot of work happening there on building that team, building a data analytics capability and also marketing relationships all across. Partnerships with radio channels, partnership with TV channels, partnership with digital platforms, partnerships with social media influencers, all that work is going on right now. If we need to have the largest share of new content, we should equally be equipped at marketing and monetizing that content in a very effective fashion.
As part of this study, another thing we did was this entire useful life of the new music content that we were acquiring. We have been sharing with you guys now for many quarters how the music that we acquired in 1960s, '70s, '80s, all of them are still growing at a significant pace. It's not that these revenues have started to decline at all. And when we started questioning our current definition of the useful life for music, which up to now, management assessment was six years. The question that was asked is right assessment of the useful life of that asset.
We asked Ernst & Young to do a benchmarking of how all the global music labels are defining their useful life of their music assets. The report has come to us, which defines that almost every major level of the world has useful life definition between 10 to 25 years of the music that they're acquiring, which is fair to please remember the life of music as true by Saregama's owned the older assets much longer the useful life that we are defined of six years. Based on our own data and the global benchmarking, the management team has recommended that we should change the youthful life of our music assets from six years to 10 years.
But unlike the global labels who follow a straight line method, we are recommending a more conservative approach whereby there is a higher amortization happening in the first two years, and then it goes on a straight line method. So to just explain this to you, typically, when we are acquiring content, 80 bucks go toward content and 20 bucks go toward marketing. Even with the new useful life of 10 years, the marketing cost is going to be charged off immediately. So no change there. Of the 80 bucks, 20% of that will be charged off in year one, 20 in year two.
And then from year three to 8.1% each. The total impact, and this is an important part for all of you to understand the total impact, and this is an important part for all of you to understand. The total impact of the change of the useful life of a music assets in this quarter has been INR 1.7 crore positive. That's the only impact it has had. This is more... Maybe it's a reassessment of the useful life. More to prepare the company, keeping in mind that large investments we will be making in future. And whatever we do has to be in sync. It's a practical reality that an asset ends up getting monetized for a much longer life than a whole of six years.
Coming to Carvaan, Carvaan's office in this quarter, we touched 98,000 compared to the 45,000 in quarter one last year. And this came entirely under Carvaan. There is no change or shift in our marketing strategy in Carvaan. We are still playing a passive role and allowing market to create, to generate its own demand. It's the opening of the retail teams to be doing the magic and adding to growth numbers. In this quarter, we also test-marketed or initiated the test marketing of two new variants of Karma. Our music bar, which is the sound bar with the karaoke and a mobile form.
This was done in the last 10 days of June. It still very early days. We will keep on assessing the feedback from the market. We in midst of that. Maybe make modifications in the product from customer feedback, and then look at a proper formal launch of these products, maybe in quarter three. We'll keep you updated as we go forward. The good part is that as we fill up, put out in the market, all to be manufactured in India so that we are not overtly dependent on supply chains emanating out of China.
Want to reiterate there is no marketing push that is plotted to any of these products. This was a slow quarter for UB. It typically happens right now. The defense and TVs come out in blocks last year. Also, everything came out in quarter four. You will find something. Most of the UB releases are going to happen in quarter three and quarter four.
That TV field business continued, which steady performance in terms of TRPs. All the three programs have delivered. The only downside we saw this time is that in the... You know a significant amount of our revenues that come from the TV businesses come in our account of advertising, both on Sun TV channel and on YouTube. We saw some amount onto there because of slowdown in the advertising revenue. We expect this to be a short-term trend and everything to come back on track the moment festival season starts.
This quarter, we finally saw the launch of the new business line of live music. We launched it in partnership with the biggest live music star of this country called Diljit Dosanjh. He's the one music-based artist right now who draws the maximum number of paid tickets in India and abroad. In fact, we did, in this quarter, completed six successful events, 2 in India in Gurgaon and Jalandhar and for Canada. And four out of these six shows actually went completely house full.
So, we are very, very happy with the way this businesses has started. With time, this business will not only contribute more and more to the top line and bottom line, but also helping our ad power to our business in the music acquisition and the creation side. So, overall ladies and gentlemen, a very good quarter for us. Significant growth, both on the top line and the bottom line, and growth on newer verticals. Music business was the biggest contributor to this growth in this quarter. Take questions from you people.
[Operator Instructions] We take the first question from the line of Savi Jain from 2Point2 Capital. Please go ahead.
Can you hear me?
Yes, please.
So, I just had a couple of questions. One was on the royalty expense. That seems to have... Unable to [indiscernible]? Why or why? Why is that?
Royalty expenses more on account, it's of the past catalog of past. And it typically depends the mix, because there is some content where there is a royalty expense, and there's a lot of content that we people acquire, but there is only a one-time payment. So, if the mix changes a bit here and there, this will keep on changing.
It's got nothing to do with the accounting change then?
No, actually nothing.
Okay.
Repeat right now, what we have done is just change the useful life offer as newer content is concerned. There is no accounting policy change that you're bringing in.
Some of newer content, if you can just, again, summarize with me, we said work on this earlier, what did you charge in the first and second year, charge off earlier, and what is it now?
Earlier, the people had the marketing work earlier, also a hundred percent straight away in the month one itself. So, there's no change to that 20%. On the remaining 80%, it was 35% in year one, right? And then 13% for the next five years. Now, what we are seeing is it's 20% in year one, 15% in year two, and then goes to 8% for the next eight years.
Okay.
It's a very small change, right? But I'm saying the net impact of that on a path is only 1.7 kilo.
But I think a lot of the content chart will be back-ended, so the benefit will come through in the next few quarters... Is that true?
So, yes. See, at the end of the day, this is more to just... What we are doing here is because our policies were not in sync with what the globals are, this was done more with our numbers being open out there after the QIP. In the US circuit also, we just wanted to come in sync with the global practices.
Got it. And on this life [indiscernible] reserve, can you give a sense of what is the revenue from this quarter?
So, right now, remember this, I said in my last quarter call also. It's an early stage. First year is going to be more testing the waters, but in general, even business is a five to 10% margin business for the next couple of years. We are running even the business for profitability, but more importantly to reinforce our position on the music creation and acquisition side, because it's the same bunch of top singers who are also contributing to the biggest songs as well as are active on the life circuit.
Yeah, I understand that, but I mean eight even will not contribute to a few, I mean, double digit and gross in terms of revenues?
Let the year get over, right? Then maybe I give you a better idea. All I can tell you that it will not be a loss-making thing. That's all the comfort I can give you. Obviously, we believe right now it should contribute significantly to top thing. This is the first quarter, first event. Give us four quarters and we will be able to go back and share more specific details with you.
Okay. And the last question is on the YouTube views. There's a significant increase every quarter. Is this to do with user-generated content being a larger part of this growth? Or is it the Saregama channel alone in contributing the growth?
As for the growth, bigger contributor is the Saregama channel, though on both, we make equal amount of money. Doesn't matter whether you are generating content or whether [indiscernible] or whether Saregama is doing an official approach because we make the same amount of money. But in reality, growth rate is coming more from our own channels because of the amount of new content that's being put up.
Okay. And lastly [indiscernible], that Instagram deal, it was a fixed B, right? It did not depend on the number of streaming that we...
Talk about specific deals.
No, no. You had mentioned that it was a fixed deal.
In general, short format app, these have expediency.
And it has not come up for the new on yet.
I cannot get into specific deals.
Oh yeah. I mean, I just want to know... Get into... Yeah, basically I think this deal has taken off significantly ever since you signed the deal, and because of fixed deal, I mean, do we expect like a significant increase when it comes up for renewal? That was all I wanted to get at, but I appreciate if you know about this.
I can't get into specific deals, Savi. Understand that we are growing our music licenses at over 20% now over [indiscernible] years. And last year we grew 26%. This quarter, the growth is even more. Clearly, it's coming out of... And we are both. We have variable deals with minimum guarantees as well as fixed deals. All of them get renegotiated in a very big fashion if the numbers are that significant. And numbers are becoming that significant because we are investing in new content aggressively.
Yeah. Got it. And there's this Ghana thing. Is that going to be a negative, because this would get acquired by someone? There's news about it getting acquired. So, there's consolidation on your customer side so that there will be a slight negative for you, right?
Let me answer this way. I will not answer specific the brand name that you took, but in...
I'll not answer specific, the brand name that you took. But in general, consolidation doesn't affect it, because the customer is going to listen to his song. It doesn't matter to me whether the customer is listening to the song on platform A or platform B. I get paid on an average 10 pesos, so it doesn't matter which platform are you running to.
No, if you're minimum guarantee on both the platforms, then you're not hitting your...
I think that you asked the right question. No, no. We are. The days off, the people not hitting a minimum guarantee, they were six years back. Now, the people constantly go back in many of the cases that are overflows coming in.
Congratulations for a good setting up.
So, let me add further. If you ask me, this is... If any other platform folds it also a signal to other platforms that they should seem to watch paid services now, it's high time. And I've been seeing this now, that it's time that these streaming platforms start making a significant push towards paid subscription. That's going to be great news for their financial viability and also means a lot of money to be made by music IP owners.
Yeah.
To be a positive news, if this prediction that happens.
We take the next question from the line of Saket Mehrotra from Tusk Investments.
Yes, Saket.
Mr. Saket, your line is in talk mode, sir. Please go ahead with your question. Mr. Saket, your line is in talk mode, sir. Please go ahead with your question. Sir, I think there is... He's muted his line from his end. We will move to the next question from the line of...
Oh. Am I audible?
Yeah. And now you're audible, sir. Please go ahead.
Okay. Sorry about that. The first question I have, Vikram, you mentioned this 550 million plus impressions of [indiscernible] part two from equal to others. So, this is across YouTube and other apps or was it just YouTube? This point to...
And the audio streaming apps. We don't include... User-generated content is not part of it, and any of the other short format is not part of. It is all variable numbers that we get reported on a daily basis.
Okay. The second question I had, Vikram, recently we saw this development where meta announced that they're starting the monetization of music on their videos. So, would you like to comment anything on that? Has that gone live for India, or is it just a global announcement that they're going with?
I'll not comment on a specific company, but in general... I'll reiterate what I said earlier. Our deals with short format apps, because they were there in fancy and short format apps are all these are, from an India [Foreign Language], from an Instagram to Whitey shots to Joe Schmots, Chingari; all these, in general, that nature of the deals is a six fee deal with a clear understanding that as their business model evolves and get into an advertising-driven business, then the fixed fee nature will change. Right? That will become variable with minimum guarantee. We saw how big that became on a platform like YouTube. We believe the other guys will also go in that direction, which means the platforms will make money as well as the IP owners.
All right. So, as of now there is... It's still in an evolutionary phase, is what I understand.
That's why we all are protected also with 63, but we have a deal set, structured in a fashion that if they offer... If they move advertising-driven stuff and they offer a share of advertising to any label globally, we also end up getting it immediately.
Got it. And any timelines on clarity on the de-merger? Can we expect it any time this financial year?
Pankaj will answer that.
Yes, I think Pankaj is fine.
So, we have been resolving all the queries that come from either the stock exchanges or [indiscernible], most of them have been done. So, during this quarter as well, there were some questions that came in relation to this, and we've done that. We now wait the final clearance first from Sebi, post which we will then, obviously, not file our application with the NCLT. We can't put a very specific date, but yes. Normally, these things do take six to eight months from the time of filing the NCLT.
We have. We are pursuing this matter and seeing to it that any kind of questions or any kind of steps that are involved to expedite are being followed upon.
We take the next question from the line of [ Shubham Ajmera from SOIC Investments ].
Yeah. Am I audible?
Yes.
Yes, please.
Yeah. So, my first question is regarding the advertisement revenue. So, as you mentioned in your opening, we must... We are setting from... We are seeing some trend in the downward before the YouTube revenue and equities. So, are we seeing the same trend in the streaming company as well?
So, we have not seen that impact putting us on our music business at all. In fact, it's only that the TV and TV part in there. Our YouTube number is still very, very small. What's hurting and which has hurt us a bit right now, is a fall in the advertising revenue and TV channels. Because my South TV serial business runs on advertising running on San TV itself.
Okay, got it. So, is there any idea regarding the slow down in the revenues for the streaming companies as well?
We don't see. Our streaming business is based actually not dependent on advertising at all. Streaming business on the free side, we have a protection through a per stream rate. On the paid side, we get a share of the subscription amount. So, in fact, the audio streaming business for us, the way our deals are structured, is actually not dependent on advertising at all.
Okay, got it. And my last question is regarding your plans for the [indiscernible], for next three to four years. If you can give me some broad idea regarding the margin side, which we're targeting in the next three to four years.
Sir, I will talk about these other stated that they will decide that we will now start investing in [indiscernible]. The call before that, I'm going to put those numbers in. We are still trying to see whether there was a demand issue with retail network shot. Then there were massive [indiscernible], because chips were not available. Things are still getting sorted out, because even if we go and manufacture restaurant parts in India, chips are still coming out there from one of these Asian countries only. So, we want to first come on top of it. Once we believe that this product is now ready for expansion, then we are going to talk to you about our investment plans and how the financials are going to work out.
Okay. Sure.
You're not going to find any investment going from site on [indiscernible]. It's just moving at this juncture on its own demand.
We take the next question from the line of Vimal Gohil from Alchemy Capital.
Yeah. Thank you for the opportunity, sir. I hope I'm audible.
Yes, please.
Yeah, I'm not sure if you've answered this, so sorry if I've made you repeat it. If you can just highlight whatever kind of investments that we see in content over the next one year, or maybe if you have any long term guidance, if at all.
Our stated aim is that, out of all the content that comes out in the market, pan India level, we want to pick up anything between 30 to 35 percent of that market. And the cost of the entire content that is expected to come out this year should be in the range around 800 crores. So, that's in that three people have. We don't know whether we'll be able to acquire the entire share in a single go. Even if we acquired it, it may so happen that the movie may not get released until its financial year. So, the deal happens now. But the movie may get released in next financial year. But broadly, this is the aim.
Okay. So, this year, possibly you are looking at somewhere near 400 crores of content investment pool. That'd be a fair assessment. If at all, assuming that the entire, you are able to take whatever entire buy that you're looking for.
800 percent. 30 percent is 240.
Okay.
It's really... That space right now. Now, this is a first year for a company, which has had a single digit share of new content when it wants to move to a 30 to 35 percent share. Even we have the intent, like in Bollywood movies, the music of the film gets sold 12 to 18 months before the movie gets released. So, it will take us that much amount of lag right now to go back and build it up, but that the space that I set of 200, 220, that kind of space that we will be in.
We take the next question from the line of Bhupendra Tiwary from ICICI Securities.
Yeah. So, my question, basically on the web series and movies part, you could talk about what is our overall pipeline of things that we are doing, looking to do over the next 12 to 18 months. Number of web series lined up. What is our kind of margin profile that we are looking to get there in this segment? Thank you.
Okay. So, I think margin part, I've always stated... I'll repeat this. This is a business right now, which is 15 to 20 percent margin, after writing of the entire cost of...
And we believe beating any profit from the second round of licensing that happens typically in this business, because you license on the first round, it may be three...
Happens typically in this business. Because you license on the first round, it may be three, five, seven, 11 year license. And then, the second round of licensing, the cost is fully written off in year one itself. All that, I'm keeping separate. I'm saying, year-on-year, [indiscernible] go out the next three to five years. The huge business in. TV and web series [indiscernible] We should be hitting in the range of 150 to 200.
So, if you could talk about the web series or the films which are lined up for the next...
I can only tell you what has been announced. There is a [indiscernible] that has already been licensed out. We will be making that delivery now, and that's when we are going to be going in and recognizing the revenue. That should get released some time this year. There is a Malayalam film with a big star out there called [Foreign Language] which is, as of now, it's expected to release in September. The number two star there in Punjabi [indiscernible]. It's in [indiscernible] called [Foreign Language], which is expected to release in the month of November. We have also started to shoot with the Malayalam biggest star called [Foreign Language], which may get released this year, may get released next year. These are things in public domain, but we are working on many more, either series concept, but all that information is still not in public domain.
We take the next question from the line of Gaurav Chopra from Union AMC.
Congrats on a good set of number. I just had a small question. Was going through the annual report. I could see the revenue from India, last it grew just by 4% in the music licensing, which is why revenue from [indiscernible] obviously up 71%. So, career highlight, why would that happen? Why would India business revenue growth would be just 4%?
So, typically, my understanding of [indiscernible], many of the deals that we are doing with global guys, I not want to take specific name, but if you think of all the major licensing companies, they're all global companies. So, from reality perspective right now, we just license it to a subsidiary.
Okay.
Yeah, we do have partners who are based out of India, so just from a classification point of view, it could seem as news to India. And I will say India, but overall, basically everything is the same.
Okay. Okay.
See, [indiscernible]. We [indiscernible], they were living in Barillian [indiscernible]. They will say that YouTube is an Indian company, but the reality will be a bit different.
We take the next question from the line of [ CA Goyal ] from [ Nvest ] Research.
Am I audible?
Yes, please.
Sure. So, my first question is, as NFPs are coming into term, so how it is going to be an opportunity for us, and how it can shape our plan going forward? Any clues on that?
So, we are very seriously exploring it. We believe NFP is a great way to unlock the value that we people own. We just want to just get our product proposition right. Because we believe if we are launching an NFP, it should not be gimmick value. There should be a genuine value and offer to the customer. Then only that business is going to become significant. You will see very soon an announcement coming from our site in this space. So, for us, it's clearly a business opportunity and not a gimmick.
Okay. Understood. Understood. Okay. And the second question is also, in quarter one, [indiscernible] 23, media segment seems to be muted, if you are comparing it to the previous quarter. So, what are the reasons for this then? Is it due to any downside in the platform, because I mean, [indiscernible], broadcasting, video screening, or social media. And how you are saying it to be an upcoming quarter?
So, let's answer the part one first. Please look at our numbers for the fourth quarter for the last five years. You will always see Q1 as the lowest quarter. In general, fourth quarter becomes very, very high, because a lot of our international publishing revenues hit us only in quarter four. A lot of society revenues later in quarter four, and our policy with these revenues is that we release them only when the cash hits our account. So, Q4 is always on the higher side. Q3 becomes higher, typically because of the [indiscernible]. That's a festival season. So, ask me, we are very delighted with the numbers that we're seeing in Q1. Because Q1 has never matched our Q4 revenue ever before. This is the first time Q1 is taking a dip. And that is [indiscernible] the music business.
Okay. Understood. This means it's better to look year on year.
You have to look on year on year basis, and that's because there is [indiscernible] in our business.
Okay. Understood. Understood. And what are the developments on the Karma Platform sites? Basically, you were mentioning your annual report with, we'll start getting advertisement [indiscernible] from Karma Platform once it get commissioned. So, what are the developments on that side?
Yes. As the new generation Karma is going to come and hit that [indiscernible]. We are advertising an ongoing subscription [indiscernible]. We are trying to build it in. We are still some time away. Like I mentioned to somebody else earlier, that whenever we are ready for the product, which may need investment from our side, we will first come out there and talk to you. But it's still some time away. Until that time, there are no marketing or manpower investment going on Karma.
Okay. That's understood. And so, basically, we are looking for the new acquisitions from the music side. And what is our specific target group when we are acquiring the new music? Are we looking towards targeting a particular [indiscernible] group or what is our basic approach? See, I am 23. So, your focus will be on our side or our parents side. So, that's basically my question.
See, new music will be all talking to your side. And I am the age of your dad. I don't participate in music acquisitions. There are younger people under the age of 30, what to buy, or what not to buy. They're very particular about it. Nobody senior is listening to music and [indiscernible]. In fact, we sometimes joke right now that if I like it at my age, that means the phone may not work. It's better than a 20 [indiscernible] only decides.
Thank you, sir. Ladies and gentlemen, that was the last question for the day. I now hand the conference over to Mr. Vikram Mehra for closing comments. Thank you, sir.
Thank you. We maintain a bullish stance on music licensing. We are projecting a 22%, 23% growth year on year for the next three to five years. This will happen irrespective of consolidation on the platform side. In fact, if anything, as I said earlier, if there is a consolidation happening, it's good news, because that means the less platforms more and more people will be looking very seriously at this subscription based business, which is great deal for both parties. The platforms, as well as the IP owners. The advertising downturn, in fact, the way our deals have structured, I don't think it's going to go back and impact us significantly at all. I think if at all, it'll be a marginal impact. In spite of economic downturn, we hold onto a 22%, 23% growth rate in music licensing business over the next three to five years.
We'll continue with our investments on content across multiple languages, both on the film and the [indiscernible] side with the young people under the age of 30. We continue with a cautious approach on Karma. The focus is going to be on the margins and not on revenue. The film series and TV business should go out there, keep on growing to 25% growth year on year, with a margin, which is at the moment around 15%. [indiscernible] will slowly build up in terms of revenue. But in the initial year, we expect it to contribute only five to 10% margin. On the business, as a management team, we are very, very bullish. We have built the right foundation, and year after year after year, quarter after quarter, we are proving it to you that the foundation that has been built is strong enough to keep on sustaining the growth rate that we people have shown over the last three years. Thanks a lot. Good evening.
Thank you. On behalf of ICICI Securities, that concludes this conference call. Thank you for joining us, ladies and gentlemen. You may now disconnect your lines.