HT Media group’s ad-for-equity portfolio crosses Rs 500 cr

The Hindustan Times group, which runs a similarly named English newspaper and the Hindi daily Hindustan, said its total investment in various companies under its ‘ad for equity’ scheme has crossed the Rs 500 cr mark.

Most large media houses in India offer a fixed amount of ad inventory in return for equity of the same value in the start-up.

Ads for Equity or A4E schemes are considered a win-win for both media companies as well as start-ups, as such deals offer start-ups much-needed marketing muscle, while also offering growth-starved traditional media companies a shot at owning a part of the next big unicorn.

HT Media Group financial head Piyush Gupta discussed the growth of A4E portfolio of his group at an investor interaction.

“The A4E portfolio is now north of Rs 500 crores,” he said, pointing out that one of the portfolio companies is even planning to list on the stock markets very soon.

“One of the companies is already filing a DRHP, and we hope to realize that value back into the balance-sheet as soon as possible,” he said in a likely reference to mobile payments platform Mobikwik.

Media reports have said that the Gurgaon-based company is planning for an initial public offering (IPO) to raise around Rs 1,500 cr by September.

Gupta said that about half of the current A4E portfolio is held by the Hindi-newspaper entity — Hindustan Media Ventures Ltd — while the others are held by at the level of the parent. HT Media Ltd, which publishes the English newspaper, holds a stake of around 75% in Hindustan Media Ventures.


On COVID-19, Gupta said the impact of the second wave has not been as sharp as was seen in the first wave last year.

The first wave of COVID-19 was extremely disruptive for the print media sector in India. Publishers lost both advertising revenue as well as subscribers over fears that the publications may be contaminated by the virus on its way to people’s homes.

The HT group’s print ad revenues had plummeted by around 77% in the Apr-Jun quarter of 2020.

Nine months on, they were still down around 22% in the Jan-Mar quarter due to the lingering impact of the pandemic.

Circulation revenue too remains impacted, particularly for the English language newspapers.

Circulation revenue for Hindustan Times and Mint are remained down a whopping 62% in Jan-Mar at just Rs 5 cr, compared Rs 14 cr in the year-ago period. They are, however, an improvement over the Rs 4 cr figure reported for the Oct-Dec period.

In comparison, circulation revenue is down only 14%, or Rs 7 cr, for the Hindi newspaper, at Rs 43 cr.

A similar divergence can also be seen in ad revenues. While advertising revenue from the English-language newspapers remained down 31% during Jan-Mar 2021 vs the same period of last year, it was down only 8% at Hindustan.

Overall, the English newspapers generated around Rs 118 cr of ad revenue during the latest three-month period, while the Hindi newspaper generated Rs 116 cr.

Gupta said the second wave of COVID-19 has been more benign on the companies’ operations. “The disruption of circulation is nowhere as sharp as it was last year,” the group CFO said. “A little bit of drop has happened. We are on a continuous program to go and re-recruit our readers. So I don’t think we will have a sharp drop in copies as we saw in the first half of Q1.”


Despite the less-than-rosy revenue picture, the group managed to cut expenses — and protect margins — during the COVID year.

The cost-cutting impact can best be seen on the companies’ employee costs — which contribute about one fourth of its total running expenses.

HT Media, which used to spend around Rs 100 crore per quarter on salaries till end-2019, posted total employee expenses of only Rs 69 cr for the latest three-month period.

Some of the reductions may have to be given up as and when the current financial difficulties get over, as they are related to ‘variable pay’ applicable to employees.

Gupta said the reduction in employee costs are related to two steps taken by the company in the immediate aftermath of the COVID-19 crisis last year.

“There were a couple of actions that we had tried at that point in time. One – we had looked at various productivity measures and had asked some of our employees to leave, and at that point in time, we had also undertaken a restructuring of the salaries, whereby some portion of employee salaries was put into variable salaries which was linked to the company’s performance.”

Most of the savings, he said, are sustainable, and not ‘one-off’ or exceptional.

“Those [gains in] productivity have already kicked in and we are a much leaner organization. So I would say this trend is likely to continue,” he said.

The company also said it is in continuing talks with Google to make its content available on Google News Showcase, a new product from the American company for more premium content.