Disney+ Hotstar and JioCinema see their valuations surpass their traditional television businesses

Viacom18 is valued at Rs 33,000 crore and Star India at Rs 26,000 crore, respectively, according to a report by EY and BDO. Both companies used the comparable company multiples (CCM) method for valuation, which estimates value based on multiples derived from the valuations of similar companies.

BDO valued Star’s entertainment segment at a revenue multiple of 1.75 times (Rs 15,999 crore) and the digital segment (Disney+ Hotstar) at a revenue multiple of 3.81 times (Rs 16,040 crore). This valuation considered Star India’s trailing twelve months (TTM) revenue up to December 31, 2023, accounting for Rs 9,142.2 crore from linear entertainment and Rs 4,210.6 crore from digital revenue.

Using these revenue multiples, BDO calculated an enterprise value of Rs 31,992.9 crore for Star India. After adjusting for liabilities associated with the sports business, the equity value was revised to Rs 25,900.2 crore, or Rs 524.5 per share.

For Viacom18, BDO provided a consolidated revenue multiple, including both linear television and streaming operations. It estimated Viacom18’s enterprise value at Rs 15,622 crore, based on a revenue multiple of 2.6 times and revenue of Rs 6,012.5 crore for the trailing twelve months ending in December 2023.

After accounting for cash balance, investments, intangible assets under development, and surplus assets, Viacom18’s equity value rose to Rs 32,937 crore. In April 2023, Reliance and Bodhi Tree Systems invested Rs 15,145 crore in Viacom18.

EY valued Viacom18 at Rs 32,955 crore and Star India at Rs 25,926 crore. Star India’s valuation was conducted debt-free, as it is unlikely to hold any cash. Combined with RIL’s Rs 11,500 crore fund infusion, EY suggests shareholdings of 46.8 percent for Viacom18, 36.8 percent for Star India, and 16.3 percent for RIL.
BCS Bureau