The Hindu Business Line : Balaji Tele up on CAS hopes

Mumbai April 16 The stock of Balaji Telefilms Ltd has been drawing investor interest in the recent past. The scrip of the company has risen 33.04 per cent month-on-month and 19.55 per cent week on week.

The interest in the company can be tracked to increase in the number of Hindi entertainment channels and the new CAS (conditional access system) and DTH (direct-to-home) systems.

"With these systems, channels will have to invest in good content to keep viewers on their rolls. And since Balaji is the number one player in the content segment, it stand to benefit the most," said Mr Ankit Kedia, media analyst, ICICI Direct.

The majority of Balaji's revenues come from Star, which has about 26 per cent stake in the company as well as a three-year tie-up to provide content.

"There has been news that NDTV will be launching a Hindi entertainment channel and are in talks with Balaji to provide content for them. If this materialises, it will be more of good news for Balaji. Since the news of NDTV's new channel has come, the stock of Balaji has been up," said Mr Hitesh Agrawal, media analyst, Angel Broking Ltd.

"Balaji has its own studio and a cash pile of around Rs 200 crore. It has proven time and again that it has the ability to expand. Therefore, it will be able to cope up with the increased demand for content," said Mr Kedia.

The company is also looking to diversify into feature films and the international markets.

Balaji will be setting up an office in Dubai and are looking to produce serials for West Asia market.

"They are also getting into movies now. They plan on releasing 5 movies this year and have set aside Rs 50 crore for the same," said Mr Kedia. This will bring in additional revenues and profits.