Shemaroo sees uptick in subscribers as advertising revenue sees heavy impact

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By Basil Kannagi Arasu

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Shemaroo Entertainment on Tuesday in a BSE filing stated that it had witnessed a spurt in the number of users and consumption in its subscriber base with people staying at home with limited entertainment options. Shemaroo, however also stated that its advertising revenue was heavily impacted with most of the brands slashing their advertising spends due to the unprecedented slowdown in the economy and their business activities coming to a standstill. The regulatory filing was in line with SEBI’s circular mandating listed companies to disclose the material impact on their company due to COVID-19.

The company noted that the lockdown and restrictions had a bitter sweet impact on Shemaroo’s business. It had a spike in the subscription based business whereas the advertisement-dependent business has taken a heavy impact. The availability of fresh content is also constrained. It stated that it had been able to manage operations remotely with the transition to work from home reasonably smooth. It has provided all the necessary infrastructure tools to its employees.

Shemaroo further it stated that it will open its offices entirely as and when the concerned authorities allow entire opening. To ensure smooth functioning, Shemaroo has identified people in each function which it will be needing to have a physical presence in the office, set up safety measures in its offices, and prepared a detailed manual capturing the guidelines to be followed on resumption of offices to be shared by all the employees at the time of resumption.

Shemaroo feels that the setback is temporary with the M&E sector bouncing back soon with rejuvenated demand and advertising spends. It expects normalcy to return towards the end of Q2 FY 2020-21. Shemaroo expects its profitability to be under pressure for decline due to broadcasters due to drop in their advertising revenue and investments in new initiatives i.e Shemaroo TV and others.

Shemaroo currently has enough cash flows to meet the operational requirements and to meet any immediate debt and other financing obligations.

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Avatar of Basil Kannagi Arasu

Basil Kannagi Arasu

News Reporter

1659 articles published
Basil keeps an eye on the latest happenings in the Telecom sector. You can find him streaming the Premier League, which he started watching in 2013, in his free time.

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