Six Month Call
UTV Software
Strong movie production, co-production and distribution pipeline for the next three years with more than 122 films slated for release in 2007-08 (Apr-Mar), 15 films in 2008-09 and 18 in 2009-10 make UTV an attractive stock.
The company recently re-engineered its business model into three verticals: content (movies and television), interactive (animation and gaming), and broadcasting. This augurs well for the company as the Rs 43,700-crore entertainment and media industry is seen growing at an compounded annual rate of 18 per cent over the next five years.
UTV's $11-million animation projects are to be delivered over the next 24 months. The company plans to produce four animation films including one in collaboration with Will Smith's Overbrook Entertainment.
It recently entered the high-growth gaming segment by acquiring 70 per cent in Ignition Entertainment of UK and 59 per cent in India Games.
The company's broadcasting business is expected to deliver long-term growth with nine television channels planned by June 2008.
Concerns
Movie production and distribution is exposed to fair amount of financial risk, arising from uncertainty regarding the success of films.
Broadcasting is a risky venture with a long gestation period, although the returns can be significant in the long run.
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