Summary
Music Broadcast Limited - Q3 FY26 Earnings Call Summary Wednesday, February 04, 2026, 12:00 PM IST
Event Participants
Executives 2 Abraham Thomas (CEO), Rajiv Shah (CFO)
Analysts 4 Chandramouli Jagannathan (Individual Investor), K. Maro (Individual Investor), Mani (Individual Investor), Rajakumar Vaidyanathan (RK Invest)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Revenue | ₹46.4 crores | +23% QoQ; driven by festive demand and improved advertiser activity. |
| Total Income | ₹54.8 crores | Includes other income; sequential improvement in business momentum. |
| Operating EBITDA | ₹15.9 crores | Significant turnaround from ₹1.3 crores in Q2 FY26 due to cost rationalization. |
| EBITDA Margin | 34% | Expanded significantly due to operating leverage and manpower consolidation. |
| Reported PAT | ₹4.1 crores | Strong sequential turnaround from a loss in the previous quarter. |
| Adjusted PAT | ₹6.0 crores | PAT after accounting for interest on NCRPS. |
| Cash Position | ₹373 crores | As of Dec 31, 2025; reduced to ₹261 crores after NCRPS redemption in Jan 2026. |
| Inventory Utilization | 90% | Based on a 15-minute per hour cap during the quarter. |
| Ad Volume Growth | -4% | YoY degrowth per Aircheck data; YTD stands at -1%. |
Geographic & Segment Commentary
- Radio Operations: Despite a subdued advertising environment, the segment saw sequential recovery with a focus on Tier 2 and Tier 3 markets. Management noted that smaller markets are showing better growth prospects, supported by a 39-station network.
- Digital & Solutions: Non-FCT (Non-Free Commercial Time) revenue accounts for ~20% of total revenue. The focus has shifted to an integrated “solutions business” combining radio, digital assets, influencer marketing, and podcasts to drive better client outcomes.
Company-Specific & Strategic Commentary
- Cost Rationalization: The company completed structural realignment, including merging horizontal teams into vertical structures and regionalizing content production. This is expected to save ₹24 crores in annual operating expenses and ₹7 crores in interest costs.
- AI Integration: Launched “RJ Sia,” an AI radio jockey, to handle advertiser-integrated solutions and spots. AI tools are also being utilized for copywriting and content creation to improve efficiency.
- Digital Pivot: Leveraging radio’s mass reach to drive traffic to digital properties, including social media, YouTube, and specialized podcast series for clients.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Expense Savings | ₹30-31 crores total | Management expects ₹24cr in OpEx savings and ₹7cr in interest savings for FY27. |
| Profitability | Sustainable Bottom Line | CEO indicated that cost cuts are permanent and will buffer the bottom line even if top-line growth is slow. |
| Ad Rates | Potential Hike | Continuous talks with the government regarding a hike in DAVP/government ad rates; no fixed timeline. |
Risks & Constraints
| Risk | Context |
|---|---|
| Subdued Ad Market | High base effect from previous year’s election spending and current cautious advertiser sentiment is impacting YoY growth. |
| Yield Pressure | Current ad rates are approximately 75% of pre-COVID levels, showing sustained pricing pressure despite volume stability. |
| Legal Dispute | Ongoing litigation with Phonographic Performance Ltd regarding 2010-2020 royalties; management believes they have a strong case with no expected outflow. |
Q&A Highlights
Financials and Buyback
- Question: Given the cash balance of ₹261 crores and market cap of ~₹200 crores, will the company consider a buyback? (C. Jagannathan)
- Answer: Management declined to comment on the proposal at this stage, noting it is a board-level decision. (Rajiv Shah)
Cost Savings Sustainability
- Question: Are the cost cuts fully baked in or is there more to come? (R. Vaidyanathan)
- Answer: Most structural cuts are complete. This quarter’s expense run-rate is the new stable baseline going forward. (Abraham Thomas)
Digital Monetization
- Question: How does the company make money from digital ventures? (Mani)
- Answer: Revenue comes from digital solutions (influencer marketing, podcasts), YouTube, and social media. Radio is used as a reach vehicle to drive audiences to these digital extensions. (Abraham Thomas)
Debt and Interest
- Question: What will be the interest cost next year following the NCRPS redemption? (C. Jagannathan)
- Answer: Interest will be negligible for the rest of the year, with only one month of interest (January) recorded in Q4. (Rajiv Shah)
Key Takeaway
Music Broadcast Limited reported a strong sequential turnaround in Q3 FY26, with Operating EBITDA rising to ₹15.9 crores and margins expanding to 34%. While YoY revenue growth remains pressured by a subdued advertising environment and a high base from previous election spending, the company has successfully executed a major cost rationalization program. By consolidating manpower and regionalizing content, the firm expects to sustain ₹31 crores in annual savings (including interest). With a net cash position of ₹261 crores post-NCRPS redemption and ad rates still at 75% of pre-COVID levels, the strategy focuses on Tier 2/3 market expansion and integrated digital solutions. The company appears positioned for improved bottom-line stability as it awaits a recovery in broader advertising sentiments and potential government rate hikes.
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