UTV to launch 8 new TV channels

Excerpts of CNBC-TV18's exclusive interview with Ronnie Screwvala:

Q: You have set up a motion pictures division and raised money from the AIM market. You have scores of plans on the motion picture, broadcast, and gaming side. What kind of revenue growth are you expecting over the next two years from either one of these divisions?

A: From our base of 2006-07, we expect a jump of at least 1.5 times. We were at about Rs 170 crore and have projected above Rs 400 crore as our revenue jump for FY08. Then we will see a constant growth going forward. We also see our EBITDA margins actually quadrupling if not less than that. Part of the trigger for that is that we were in investment and re-engineering mode in one or two aspects and that job was done in FY06 and FY07. You will see that as a profitable reflection in FY08, which is the current year.

Q: Give us an idea of what kind of fund raising you really need to do for the broadcasting business?

A: Our movie agenda is primarily fully funded. We have made investments in gaming and new media and that has been fully funded too. Our television business is working capital positive. Going forward, the key investment, if any, is in broadcasting. UTV is committed to put about Rs 150 crore and in our total outlay is about Rs 600 crore. We see the balance of Rs 450 crore coming from a strategic partner at a premium.

Q: How soon do you hope to be able to tie that up? Are you already in conversation?

A: We are in active discussions with three parties and see a closure on that not more than 90 days from now, if not earlier.

Q: What are your plans on the gaming side of the business because you have made two acquisitions and have set up shop in UK. There is a tie-up with Virgin as well?

A: In gaming, between Indiagames in India and Ignition in the UK, we are essentially looking at the online, which we are very excited about, mobile, and console platform. Ignition focuses on that and there we have three very high-end games planned out. One of them that has already made progress is WarDevil. Then we have just greenlit and two other high end games, which will be across platforms, with the quality of a PS3 platform, but pretty much migrating to PS2, Xbox, and all the others.

Between these three games and some of our publishing activities in the UK, at this stage, we see almost about Rs 75-100 crore coming out of just Ignition in our topline this coming year.

Q: Give us an idea of the number of channels that you plan to launch. Is it 8 for the next 12 months or so and how many of them would belong to brand Bindass? What are the different categories that you are looking at?

A: We are looking at nine channels. Four of them are in the brand Bindass category, which is general entertainment for the 16-34 age groups, which is our core group in Bindass and Bindass Movies , which is a flanking channel for Bindass. Both of these are in regional languages constituting four.

Apart from that, we have key specialty channels, which also border on the general entertainment space. One is in the world cinema arena and the second is a 24-hour Hindi movies channel. At this point, we are not at liberty to talk about the other three, but we will be doing so in the next 30 days.

Q: On an FY08 level, how would you break up segmental revenues in terms of the target that you have laid out for either one?

A: In FY08, the projections that I just mentioned earlier, including the above Rs 400 crore in topline, there is nothing factored-in for broadcasting because the first channel launches at the end of this month or the beginning of September. This is Bindass.

After that, between then and March to June of next year, we will see the launch of all channels. So, we really have not factored-in too much of topline in FY08 for broadcasting. The bulk of that is movies, gaming and animation, and our television content business.