Companies

Star CJ targets $1 b revenue with new PE partner

Our Bureau Mumbai | Updated on June 26, 2014

US-based Providence picks 50% stake





With private equity firm Providence picking up 50 per cent stake in it, Star CJ is targeting a $1-billion revenue in five years. The home shopping channel recently replaced its partner Star with Providence, with the latter picking up the broadcaster’s equal stake in the venture.

US-based Providence has already invested in Indian companies such as Idea Cellular, Aditya Birla Telecom, UFO Moviez and Hathway Cable and Datacom.

Kenny Shin, CEO, Star CJ Network India, said: “Our new private equity partners have an IPO on their mind in the next five years when we expect to reach a revenue of $ 1 billion in India.”

Launched in 2009 as a six-hour television slot on Star Utsav, Star CJ started its standalone channel in 2014 extending it to internet and mobile channels. South Korea is the largest market for CJ Corporation followed by China with India as its third largest market.

Almost 49 per cent of its sales are from local brands with kitchen appliances comprising 20 per cent followed by other categories such as small appliances and IT products. Reaching out to destinations across 4,500 pin codes, the home shopping company is planning to improve its logistics by opening a new warehouse in the North-East.

“We have been growing at a CAGR of 50 per cent in the ₹2,200-crore home shopping market,” added Shin. Operating as a B2B company, Star CJ is in the wholesale cash-and-carry segment with franchise partners representing it at the front-end. “FDI in retail does not apply to us as we are not a retail company. We are a wholesale company in the cash & carry segment with five other franchise companies representing us in the retail space,’’ said Shin.

Today, almost 95 per cent of its revenue come from its television channel, but its internet site is growing faster and is expected to contribute between 10 and 15 per cent of the revenues going forward. Star CJ is in the process of breaking even and also changing its name without Star being attached to it.

Published on June 26, 2014

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