| HT Media Limited | ||||
| 'Crisil AA-/Negative' assigned to Bank Debt; CP Reaffirmed; NCD Withdrawn | ||||
| Rating Action | ||||
| ||||
| ||||
| Note: None of the Directors on Crisil Ratings Limited’s Board are members of rating committee and thus do not participate in discussion or assignment of any ratings. The Board of Directors also does not discuss any ratings at its meetings. | ||||
| 1 crore = 10 million | ||||
| Refer to Annexure for Details of Instruments & Bank Facilities |
Detailed Rationale CRISIL Ratings has assigned its ‘Crisil AA-/Negative’ rating on the long-term bank facilities of HT Media Ltd (HTML). The short-term rating on the commercial paper has been reaffirmed at ‘Crisil A1+’. Crisil Ratings has withdrawn its rating on the NCDs of Rs 96 crore as the same has been redeemed. Crisil Ratings has also withdrawn its rating on NCDs worth Rs 4 crore, as requested by the client, and in line with the policy of withdrawal.
The revision in outlook reflects the continued modest operating performance in 9M FY 25 and the possibility of continuation of weaker than expected operating performance going forward primarily on account of reported losses in digital segment. Overall operating losses (including digital) for 9MFY25 stood at ~Rs 58 crore (compared to losses of ~Rs 73 crore in FY 24) with digital and unallocated segment reporting operating losses at Rs 120 crore (and operating loss of Rs 167 crore in FY 24).
The ratings continue to reflect the strong market position of HTML's flagship English daily, Hindustan Times (HT), and the established market position of its Hindi daily, Hindustan. The ratings also factor in HTML's healthy financial flexibility with a strong liquidity of ~Rs 1,612 crore as on September 30, 2024. These strengths are partially offset by continued weak operating profitability and susceptibility to volatility in newsprint prices and economic downturns. |
Analytical Approach CRISIL Ratings has combined the business and financial risk profiles of HTML and its subsidiaries. This is because the entities, collectively referred to as the HTML group, are in related businesses and have common promoters.
Please refer Annexure - List of entities consolidated, for details of the entities considered and their analytical treatment for consolidation. |
Key Rating Drivers & Detailed Description Strengths: Established market position of publications: HT Media has been able to maintain its market position in key markets which are: for English print – Delhi NCR, Mumbai, Uttar Pradesh and Punjab (incl. Chandigarh) and for Hindi print – Delhi NCR, Uttarakhand, Bihar, Jharkhand. should continue to support HTML’s overall business risk profile.
Operating profit of the print segment improved to Rs 60 crore in 9MFY25 from Rs 26 crore in 9MFY24 owing to steady newsprint prices and improvement in ad revenues.
Strong financial flexibility: Capital structure of the company draws support from the sizeable gross liquidity of ~Rs 1,612 crore as on September 30, 2024, which comfortably exceeds the total gross debt of ~Rs 692 crore. Gearing is estimated to be ~0.36 times as on March 31, 2025, and should remain stable over the medium term. The financial risk profile should sustain, aided by healthy treasury income and strong financial flexibility. Going forward, operating losses in the digital segment are expected moderate with significant improvement in operating revenues in the digital segment. Nonetheless, higher-than-expected investments in the digital business having a bearing on the overall financial flexibility, will remain a key monitorable.
Weaknesses: Continued modest operating performance: The company has been investing in the digital segment, especially OTTplay, leading to operating losses. On a consolidated basis, the company made EBITDA losses of Rs. 58 crores in 9MFY25. Further, the operating margin of the radio business remains subdued, albeit expected to improve, due to high statutory costs of operating in multiple frequencies in metro cities. That said, with the expectation of newsprint prices remaining stable and improvement in ad revenues, the operating profitability of the print business should remain strong in the next fiscal year.
Continued investments in digital business and modest operating margin of the radio business is expected to continue to have bearing on overall profitability of the company in the near term.
Exposure to volatility in newsprint prices and economic downturns: A substantial share of operating income is derived from advertisement revenue, which has a strong linkage to economic activity and is affected by economic cycles. Recessionary cycles and uncertain market conditions lead to a slowdown in spending, constraining the ad revenue for print as well as radio media.
In addition to linkages with overall economic activity and corporate spending, the operating cost of the company also depends on movement in newsprint prices which accounts for approx. 30% of the operating cost. Newsprint prices have softened in the last fiscal, from their peak in the second quarter of fiscal 2023 and were stable in fiscal 2025. Thus, the operating margin for the print segment is expected to improve this fiscal.
The movement of newsprint prices, sustenance of recovery in ad revenue and their impact on the operating profitability of the company going forward will remain a key monitorable. |
Liquidity: Strong HTML’s strong liquidity is driven by cash and equivalent of ~Rs 1,612 crore as on September 30, 2024, and estimated net cash accrual of Rs 150-250 crore per fiscal over the medium term. Available liquidity, healthy treasury income and accruals should suffice to cover debt repayment obligations and capex outlays over the medium term. |
Outlook: Negative Reflects the possibility of continuation of weaker than expected operating performance going forward primarily on account of digital segment |
Rating Sensitivity Factors Upward Factors
Downward Factors
|
About the Company Hindustan Times Ltd (HTL), a KK Birla group company, which holds 69.51% stake in HTML as on March 31, 2024, demerged its print media business into HTML in July 2003. HT, the leading English daily in Delhi that was inaugurated by Mahatma Gandhi in 1924, is HTML's flagship product. Other publications include Hindustan and Mint. HTML has presence in the FM radio space through Fever FM, Radio Nasha and Radio One; and has internet portals such as shine.com. |
Key Financial Indicators (Consolidated)
NM: Not meaningful. Financial numbers mentioned in this report are CRISIL Ratings adjusted numbers and may not be directly comparable with company financials |
Any other information: Not Applicable |
Note on complexity levels of the rated instrument: |
Annexure - Details of Instrument(s)
Annexure - Details of Rating Withdrawn
#Yet to be issued |
Annexure - List of Entities Consolidated^
^List of consolidated entities as per last filed results |
| Annexure - Rating History for last 3 Years | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| All amounts are in Rs.Cr. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Annexure - Details of Bank Lenders & Facilities | ||||||||
|
Criteria Details
|