#tips industries My key takeaways from latest (Q3FY21) concall and investor presentation. If you like the thread, please retweet so that others can also benefit.
1. Management confident of growing topline at 25-30%. Claims industry is growing at 30-40%.
1. Management confident of growing topline at 25-30%. Claims industry is growing at 30-40%.
In b/w lines: Personally, I felt some of the numbers were pulled out of thin air. Management seems a bit less professional than #saregama. Having said that, as tips inks more deals with music licencing platforms (eg:telecom.economictimes.indiatimes.com/news/tips-indu…) it can meet its revenue growth guidance
2. If they buy a song for X, they make that money back in 1 year. Maximum of 2 years.
In b/w lines: This is extremely high ROICs. It must be understood why the content they acquire is selling so cheap that they are able to make an ROIC of 50%-100%.
In b/w lines: This is extremely high ROICs. It must be understood why the content they acquire is selling so cheap that they are able to make an ROIC of 50%-100%.
I still do not understand. For comparison, #saregama guides for 20% ROIC. If someone understands this, please reach out to me or reply to this tweet. Looking to learn.
3. Music licensing revenue fell from 9MFY20 to 9MFY21. Why?
In b/w lines: Q was not asked in concall. My guesstimate: 2 possible reasons: (i) Right now, they get only 60% revenues from OTT/digital and 40% from offline/TV/parties. The second stream dried up due to covid.
In b/w lines: Q was not asked in concall. My guesstimate: 2 possible reasons: (i) Right now, they get only 60% revenues from OTT/digital and 40% from offline/TV/parties. The second stream dried up due to covid.
Problem is only temporary though, as digital grows faster than analog, revenue streams would become more stable and less lumpy.
(ii) Their music licensing deals are of 1-2 year durations typically. Due to smaller catalog, their negotiation power with music streaming platforms is more limited. Deal with Gaana fell through. Could have impacted revenues. As they grow scale (catalog), lumpiness should reduce.
@NeilBahal @OldSchoolFinanc @NAVofNav @mehrotra_saket FYI since you seem to be interested in Tips. :)
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