Zee News

I take this opportunity to greet you and thank you for the trust
 bestowed on the organization and share with you my thoughts on your
 companys performance during the year gone by.
 
 Diversity the Growth Driver
 
 Few other periods in World history have seen such financial turmoil and
 global market crisis like the year 2008-09. However, fueled by
 increasing local advertising, regional media continued on its growth
 path. As the economy shows signs of recovery, this segment is now
 poised for rapid expansion and growth. Zee News Limited had identified
 this opportunity in diversity well ahead of its time and implemented
 plans to capitalize on the same. Diversity, which shaped the history of
 India, is now propelling Indian economic growth. Quite aptly, our
 strategy continues to leverage the opportunity that diversity presents
 to us for sustainable growth of your company.
 
 Reaching Far and Wide
 
 True to its mission of conducting a fair and informed discourse on the
 issues affecting regional aspirations and providing quality
 entertainment to various regional audiences, Zee News Limited has
 further enriched its bouquet and it now operates thirteen channels in
 the news and regional entertainment space. Bucking the slowdown, your
 company successfully launched Zee Tamil in October 08 followed by Zee
 News Uttar Pradesh and Zee 24 Gantalu in April 09. Living up to our
 commitments, even during adverse economic conditions, we protected your
 companys margins, despite aggressive expansion. We are now present in
 most of the diverse language-differentiated regional television markets
 in the country. Apart from the other untapped regional markets, global
 English news and English business news channel continue to be on our
 radar.
 
 Leveraging Digitization
 
 Our vision of making early investments in digitally encrypted channels
 is bound to yield positive results with subscription revenue from
 digital cable formats expected to be a key growth driver going forward.
 Today, Zee News Limited stands apart from the crowd in terms of its
 capability to garner subscription revenues. In the fiscal year gone by,
 your company recorded continuous increase in digital subscription and
 closed the year with subscription from digital connections forming 34%
 of the total subscription revenue. Given the rapid DTH proliferation
 that the country is witnessing, subscription revenue would continue to
 enjoy high traction going forward.
 
 Inclusive Growth
 
 Your company continues to enjoy leadership position in key growth
 markets. The flagship Zee News, now a well-respected imagery leader,
 often emerged number one in terms of time spent by viewers during any
 event of significant national interest. Zee Business evolved and grew
 by leaps and bounds during the year and rose from an average channel
 share of 13% to a share of 25% in the business channel genre. It is
 arguably the most successful media turnaround story of the year. Zee
 Marathi, along with Zee 24 Taas and Zee Talkies is an essential for the
 Marathi viewer while Zee Bangla and 24 Ghanta dominate West Bengal
 households. While Zee Marathi and Zee Bangla continued to be leaders,
 both Zee 24 Taas and 24 Ghanta emerged as No.l news channels in their
 respective genres. Zee Telugu and Zee Kannada are now a name to reckon
 within the South Indian television market. Zee Telugu operationally
 broke even during the year, as guided.
 
 ZNL Financial Highlights: 2008-09
 
 While diversifying and creating new ventures of growth, we also focused
 on building balance sheet strength and maintaining adequate liquidity
 levels. Your company has been performing with characteristic efficiency
 and profitability. Zee News Limited delivered solid top-line results
 for the year. Operating revenue grew 42% to Rs 5.2 billion. Our
 advertisement revenue stream delivered an increase of 39% to Rs 4.0
 billion, while the subscription revenue stream delivered an even better
 45% increase to Rs 969.6 million. The operating profits (EBITDA)
 improved by 23% to Rs 836.4 million, despite investments in new
 products like Zee Tamil, Zee 24 Gantalu and Zee News Uttar Pradesh.
 Profit after Tax was up 20% to Rs 446.3 million, while earnings per
 share increased to Rs 1.86 during FY2009.
 
 Looking Ahead: Sustainable Growth
 
 A fundamentally strong entity with focus on current deliverables, your
 companys strategies are aimed at rapid growth and continuous
 improvement in performance by expanding presence in other key markets,
 technological up-gradation, adoption of best practices and global
 benchmarking. Our recent strategic partnership with Akaash Bangla, a
 premier Bengali GEO brand, highlights our intention to grow through
 inorganic growth strategies as well, whenever such suitable opportunity
 arises.
 
 With the advertiser becoming increasingly conscious with his choice of
 platform and seeking value for money, news and regional channels are
 expected to be the beneficiaries. That, along the viewers propensity
 to pay for regional media consumption and the resulting subscription
 revenues, is conducive for sustainable growth in your company going
 forward.
 
 At the end, I would like to conclude by thanking, on behalf of the
 Board of Directors of Zee News Limited, all our viewers, investors and
 other stakeholders for their support and confidence in the management
 of your company.
 
 Subhash Chandra
 Chairman