Saregama India Limited has announced the completion of its acquisition of Finnet Media Private Limited through its material subsidiary, Pocket Aces Pictures Private Limited (PAPPL). This strategic move marks a significant step in Saregama's expansion plans in the digital content space.

Key Details of the Acquisition

Implications and Future Plans

The acquisition of Finnet Media transforms it into a wholly-owned subsidiary of PAPPL, effectively bringing it under the Saregama umbrella. This move aligns with Saregama's broader strategy to strengthen its position in the digital content production landscape.

Saregama has indicated plans to acquire additional Original Content Producers (OCPs) over the next two years. This suggests an effort by the company to expand its content creation capabilities and diversify its portfolio in the digital media space.

Corporate Disclosure

The completion of this acquisition was disclosed by Saregama India Limited in compliance with Regulation 30 of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015. The company had previously notified the stock exchanges about the Board of Directors' approval for this acquisition on September 25, 2025.

Saregama India Limited, a leading music and entertainment company, reported its financial results for the second quarter of fiscal year 2026, showcasing resilience in a challenging market environment.

Financial Highlights

• Operating revenue: INR 230.00 crores
• Profit Before Tax (PBT): INR 60.00 crores
• Music segment growth: 12% year-on-year

Segment Performance

Music Segment

The music segment, which includes licensing and artist management, demonstrated strong performance with a 12% year-on-year growth. Notable releases contributing to this growth include:

• Tamil album 'Idli Kadai' (Dhanush movie)
• Bengali album 'Dhumketu'
• Malayalam film album 'Sahasam'

Non-film releases such as Badshah's 'Kokaina', Honey Singh's 'Mashooqa', and the Marathi song 'Chal Turu Turu' also performed well.

Video Segment

The video segment experienced a decline due to fewer releases compared to Q2FY25. Management attributes this to cyclical issues and emphasizes evaluating performance on a rolling 12-month basis due to the lumpy nature of video content releases.

Strategic Initiatives

1. Content Investment: Saregama India plans to invest INR 320.00-330.00 crores in new music content this fiscal year, slightly lower than earlier projections due to film album delays.

2. Generative AI Implementation: The company is leveraging Generative AI tools to create music videos for older songs, reducing production time from 10-12 days to 2-3 days.

3. Artist Management: The artist management vertical added 18 new artists, bringing the total to 230 artists with a combined social media following of 200 million.

4. Brand Partnership Vertical: Saregama India has created a new brand partnership vertical to consolidate selling across all business segments, aiming to offer comprehensive solutions to brand partners.

Outlook and Guidance

• Music segment growth guidance revised to 19-20% for the current fiscal year.
• Long-term projections maintained at 23% CAGR for the music business.
• Adjusted EBITDA margin guidance of 32-33% remains unchanged.
• Consolidated revenue growth (excluding Carvaan) projected at 30% between FY24 to FY27.

Management Commentary

Vikram Mehra, Managing Director of Saregama India, stated, "We are seeing movement happening. For the first time, we are seeing promotions being run and advertising communication being put out by these platforms to push for subscription." He expressed optimism about the potential growth in subscription-based streaming services, particularly among younger demographics.

Industry Trends

The company noted positive developments in the music streaming industry, with major platforms beginning to push for paid subscriptions. Management believes this shift could lead to significant revenue growth, similar to trends observed in Latin American markets.

Saregama India continues to focus on strategic content acquisition, particularly in languages where paid subscribers are expected to enter the market first. The company remains optimistic about the long-term prospects of the Indian music streaming market, anticipating a shift towards subscription-based models in the coming quarters.

In conclusion, despite short-term challenges in certain segments, Saregama India Limited maintains a positive outlook on its growth trajectory, supported by strategic initiatives and favorable industry trends.