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Home-shopping company Star CJ Network India Pvt Ltd is looking at private-equity (PE) placements to fund expansion plans in India.
Expansion would primarily be into the Hindi-speaking belts of the country along with the Eastern region, followed by South India.
Mumbai-based Star CJ, that runs a 24x7 shopping channel (Star CJ Alive) and an online portal is 50:50 joint-venture between Rupert Mudroch-run News Corp and South Korea’s CJ O Shopping Co Ltd Programmes are aired in Hindi only.
“We are looking at PE placements to fund our expansion plans here. However, we are awaiting necessary clearances from the FIPB (Foreign Investment Promotion Board),” Kenny Si Yeol Shin, Chief Executive Officer, Star CJ, said. Currently, Star CJ Alive competes with Network 18’s HomeShoppe 18.
Stake Sale According to reports, News Corp’s Star Group is likely to exit from the venture by selling its stake to the PE partner. The deal is pending FIPB clearance, sources said.
However, Yeol Shin refused to confirm details or the stake that the PE partner will pick up in the company. “We cannot comment on the stake that’ll be picked by the PE,” he said.
Star CJ Alive was launched in September 2009 as a six-hour slot on Star Utsav, a part of Star Plus. It was later spun-off as a separate 24-hour home shopping channel in August 2010.
Expansion Although loss-making, the company is expected to break even next fiscal (FY15) once it is able to expand across regions, Yeol Shin said. Break-even would refer to both annual and monthly profits. Its online shopping portal - starcj.com - is breaking even. Being privately held, Star CJ does not share revenue details, but plans to be a Rs 5,000-crore company by FY18. In West Bengal, plans are afoot to set up a warehouse over the next one year, at an expected investment of ` 2 crore. It will cater to the Eastern region. Warehouses are located, one each in Delhi-NCR, Bangalore and Mumbai.
Star CJ is also eyeing tie-ups with MSOs (multi-system operators) such as le and Hathway, apart from existing direct-to-home players like Airtel, Tata Sky, Dish and Videocon.
It is also looking to apply for licences to air regional content in select states hoping to garner a better regional foothold. Its foray in Southern markets was hit because of language barriers.
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