×
You will be redirected back to your article in seconds

Indian Biz Weathering Fiscal Storm

Media and entertainment show growth despite currency drop

The combination of a softening Indian economy and the end of the U.S. stimulus program has caused the Indian currency to fall to record lows. It dropped 13% in August, including 4% in a single day on Aug. 28 to 68.7 rupees per $1, hitting 65.7 rupees per $1 at the end of the week.

But the media and entertainment sectors seem relatively unscathed so far.

Economic growth is forecast at 5% nationally, compared with nearly 10% two years ago. And the industrial sector may crawl along with 1% growth in 2013, compared with more than 8% in 2011. In contrast, the Indian film industry is expected to outperform those markers, with expansion this year at 9.1%. Advertising is also healthy: Print ad expenditure is up 13% in the first half of the year, and TV advertising has risen 16% in that same time period.

That’s because, despite the slowdown, other macroeconomic factors, such as demographics and literacy rates, are increasing the potential audience for film and TV. Also, over the past couple of growth years, Bollywood studios have pumped money into production, expanding the number and scale of films that will be seen onscreen in 2013-14. That bodes well for box office.

If the slowdown continues, there will likely be a negative impact on advertising rates — there is already evidence that cars and consumer goods sales are softening. But significant industry restructuring may still help TV groups — most notably the rollout of digital cable systems that bring more households into the (legal) pay-TV loop.

A falling currency makes imports more expensive and boosts the value of exports. While Bollywood enjoys moderate overseas sales, it is India’s export-driven service sectors that could really benefit, as the cheaper currency will help them undercut competitors. Companies in this group include Prasad (post ), Reliance MediaWorks (post-production and film restoration), Prime Focus (3D conversion and effects) and Red Chillies Entertainment (vfx).

India’s global-minded animation companies Toonz Entertainment and DQ Entertainment may also benefit from a weaker rupee, as long as they don’t have large amounts of foreign debt to service.

More Biz

  • Smoke haze covers the Sydney Harbour

    Australia's Seven West to Merge With Affiliate Prime Media

    Australia’s Seven West Media has agreed a deal to acquire regional broadcast group Prime Media. The move is a further step in the consolidation of Australia’s traditional media industry. The two companies announced on Friday that Seven will make the acquisition entirely through the issue of new shares to the owners of Prime. Both companies [...]

  • Ron Meyer

    Ron Meyer Files $10 Million Suit Over Forged Rothko

    NBCUniversal Vice Chairman Ron Meyer has filed a $10 million suit against two art dealers, claiming they sold him a forged Mark Rothko painting in 2001. Meyer accuses Susan Seidel and Jaime Frankfort of duping him into buying the work. According to the suit, he was told that it would be included in an official [...]

  • Former movie producer Harvey Weinstein (L)

    Harvey Weinstein Seeks to Call Expert on 'Recovered' Memories at Rape Trial

    Harvey Weinstein’s attorneys are seeking to call an expert on “recovered memories” at his trial on rape and sexual assault charges. The defense has filed a motion asking to call Deborah Davis, a psychologist and professor at the University of Nevada at Reno. Davis is a frequent defense witness. She co-authored an article in 2006 [...]

  • Tekashi 6ix9ine Docuseries Coming From Showtime

    Tekashi 6ix9ine Docuseries Coming From Showtime and Rolling Stone

    Showtime Documentary Films today announced a new limited docuseries profiling controversial rapper Tekashi 6ix9ine. Titled “SuperVillain” and inspired by the Rolling Stone feature written by Stephen Witt, the three-part series will trace how a New York City deli clerk named Daniel Hernandez became superstar rapper Tekashi 6ix9ine — who racked up 2.6 billion streams and [...]

  • Fader Label Logo

    Fader Label Signs Two New Acts, Boosts Staff

    The Fader Label, home to Clairo, Matt and Kim and others, announced two new signings today along with three new hires on its staff. Charlie Burg and Zachary Knowles have joined the label’s talent roster, while Carson Oberg has come aboard as general manager, Yasmine Panah as project manager and Josh Hymowitz as label coordinator. They [...]

  • CBS HEADQUARTERS

    CBS-Viacom Merger Details Revealed, Shares to Trade on Nasdaq

    Negotiations between CBS and Viacom went down to the wire on the day the long-gestating transaction was finally sealed on Aug. 13. CBS Corp. and Viacom revealed the timeline of the merger talks in a Securities and Exchange Commission filing on Thursday that runs more than 650 pages. Also Thursday, CBS and Viacom said the [...]

  • Nile Rodgers and Merck Mercuriadis

    Hipgnosis Songs Raises Another $295 Million

    Hot on the heels of its deal to acquire a catalog of 108 Timbaland copyrights, Hipgnosis Songs has raised another $295 million (£231 million) — putting its total to nearly $800 million to date. According to the announcement, a total of 231,000,000 C Shares have been placed by Nplus1 Singer Advisory LLP  and J.P. Morgan [...]

More From Our Brands

Access exclusive content