Television channels in Pakistan are now making inroads into the capital market as 'Eye Television Network Limited' (branding the channel with the name of 'Hum TV') will be the first satellite TV channel to be listed on a local bourse.
The listing of 'Eye Television' on Karachi Stock Exchange will undoubtedly open a new window of opportunity for all media players in the financial market. 'Eye Television', that has launched 'Hum TV' as its first channel, has a paid up capital of Rs 500 million, out of which, Rs 270 million has been invested by the sponsors and Rs 80 million generated through private placements. The balance of Rs 150 million will be floated through initial public offering on June 27 and 28.
There are almost 50 media houses in India that have floated their shares to the Indian public, and 'Zee TV' is one of them, which has firmly established itself as one of the leading media houses not only in the subcontinent but also in European and other regions. In 2004, the price of Zee TV share of par value Indian Re 1 touched Indian Rs 174 and is considered as one of the strong scrips in the Sensex index.
Although the company, 'Eye Television', is new, it is backed by people like Sultana Siddiqi, Khush Bakhat Shujaat, Mehtab Akbar Rashi, Duraid Qureshi, and others who together bring over 100 years of showbiz experience. No wonder that a host of institutional and other investors have shown faith in its very promising prospects. Some of key names include Jahangir Siddiqui group, Haji Ghani Usman, Crosby Fund, Dawood group, Aqeel Karim Dhedi, EFU, Javed Jabbar, Nisar Memon, KASB Bank, Crescent Bank, Atlas Bank, Inter Bank, Escorts Bank, Network Leasing and WE Financial Services.
The channel is not only backed by media veterans, it also has state-of-the-art equipment that delivers very high quality programs. Another unique feature of Hum TV that has raised its popularity in a very short span of time is the fact that it is the only local channel focused solely on entertainment. Besides, it's a family channel that keeps the entire family glued to its transmission.
Hum TV has established its popularity among viewers in a very short time it has been on air. The company has received a licence for setting up a satellite channel in Pakistan from Pakistan Electronic Media Regulatory Authority (Pemra) that includes production and uplinking facilities directly from Karachi. Being listed on the Stock Exchange is no mean achievement for the young company, which has high aims and determination to achieve them.
According to Tariq Hussain Khan, research analyst at Atlas Investment Bank, the advertising is where 'EYE TV' generates most of its revenue comprising 85 percent of its income. According to various industry sources, advertising expenditure on TV is estimated to have grown by 40 percent during the current fiscal year to Rs 6.3 billion, compared to Rs 4.5 billion during FY04. From here on, this is expected to grow by 20-25 percent for the next few years. This is going to particularly help EYE TV because almost 50 percent of the advertising is done by Fast Moving Consumer Goods (FMCGs) which cater more towards the female and youth clientele, and it is particularly this segment which Hum TV is focusing. Other revenue sources include sales of programs to international channels, namely Prime Time USA and Prime Time UK. Branding revenue is generated through shows that others sell to the channel to telecast and Call Ins contribute 2.5 percent each to total revenue.
Positive move by the regulators: A few steps are expected to be taken by the government to promote media in Pakistan. The most important of all is the possibility of raising barriers for entry of foreign channels to market their products in Pakistan so that maximum amount of advertising expenditure is distributed among Pakistani TV channels.
In addition, the government has revised its policies towards media and TV to support liberalisation.