Raj TV plans IPO in mid-January

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Tamil satellite TV major Raj Television Network, Raj TV plans to launch a new youth channel by mid-June 2007 that will entail an investment of around Rs 10 crore, reports The Economic Times.

The company, which will set up a 9,000 sq ft state-of- the-art studio here, also plans to expand its footprint overseas, strengthen its distribution network abroad and foray into the production of telefilms besides enhancing content.

An IPO of around Rs 100 crore is on the anvil by mid-January to finance its growth initiatives, said Raj TV's managing director M Raajhendhran.

The company has two channels - family channel Raj TV and movie channel Raj Digi Plus. Raj TV became a pay channel in 2003.

Outlining his future plans, Raajhendhran said the youth channel, whose name would be unveiled shortly, will mainly feature music, realty, lifestyle and game shows.

"There will be no soaps and perhaps even no films. It will be targeted at the age-group of 15-40 and all those young at heart," he said.

The company plans to rope in leading film directors and stars for its shows, besides adding more properties. "We have to keep in mind the audience's tastes which keep changing and accordingly cater to that," Raajhendhran said.

Another growth strategy involves strengthening its marketing in overseas markets like the US, Britain, Middle East, Africa, Europe, Australia and Latin America. The company will not only tap the Tamil market in these regions but the entire Indian diaspora by sub-titling contents.

The company currently possesses the rights for 1,300 films, valued at Rs 374 crore, and plans to build on this aggressively.

Besides, it plans to distribute five movies overseas apart from its satellite rights, which it hopes will add a new dimension to its overseas presence.

According to Raajhendhran, the company will be offloading 25% of its shares (or 36 lakh shares) through the IPO in mid-January. "We propose to raise around Rs 100 crore through our IPO to finance our growth initiatives," he said.

The last quarter saw an increase in the channel's advertising revenue at Rs 9.5 crore. The company increased its ad charges to Rs 1,800 per 10 seconds from the earlier rate of Rs 1,500 for the same time slot.

The southern satellite TV major had clocked a PAT of Rs 2.9 crore on a turnover of Rs 32 crore in FY 06 and hopes to grow this to around Rs 10 crore on a turnover of Rs 40-crore this fiscal.