http://valuexindia.com - On day 1 of VALUEx India 2011, the group welcomed Ramesh Damani to share his thoughts about the current market environment in India. Damani is a proponent of value investing and has a brilliant track record when it comes to picking stocks. Damani is one of India’s most rational voices on investing. Damani is a member of the Bombay Stock Exchange and has hosted shows on CNBC-TV18 conducting interviews with the legends of investing in India and abroad. During his presentation, Damani spoke about the electronic media space and identified specific catalysts which should unlock valuations for select companies in the space.

1. Ramesh S. Damani
Nov 7, 2011

2. News Item:
Mahatma Gandhi’s items on auction.
“The personal items to be auctioned are Gandhi's
metal‐rimmed glasses, pocket watch, a pair of sandals
and a plate and bowl. The collection has a reserve price
and a plate and bowl The collection has a reserve price
of between 20,000 dollars and 30,000 dollars.”

3. CNN IBN NEWS FLASH:
CNN‐IBN NEWS FLASH:
Vijay Mallya buys Gandhi's items
for $1.8 million.
f $1 8 illi

4. Value Investing FAQ:
Value Investing FAQ:
Q1) Why is September 19, 2007 considered an
Q1) Why is September 19 2007 considered an
important day in cricket history ?
Q2) What does it have in common with Value
investing?
i i ?

5. India s Yuvraj smashes six sixes!
India's Yuvraj smashes six sixes!
Yuvraj Singh
became the first
became the first
player in Twenty20
history to hit six
sixes in an over in
India's match
I di ' t h
against England in
a world cup match
in Durban, SA.
The devastating
barrage from Yuvraj,
25, helped him
25 helped him
reach his half‐
century off just 12
balls ‐ the fastest 50
ever in international
cricket.

6. The Indian Bull Markets Intellectual
Hypothesis:
h
• The 'bird of gold':
The bird of gold :
• The rise of India's consumer market As India
transitions to become the world's fifth largest
g
consumer market by 2025, its middle class will swell
by over ten times its current size of 50 million to 583
million people. – Mckinsey Survey 2007

7. Jewels in the crown
Fantasy Five:
Name Mcap Jan 2003 Mcap Jan 2008 X times Sector
Pantaloon 90 7450 80 Retail
United Spirits 225 16000 70 Beverages
Axis Bank
Axis Bank 800 32577 40
40* Banking
Bharti 4188 145549 35* Telecom
Titan 300 4617 14* Jewelry
Totals 5603 206193 40 (Mcap is Rs crs)

8. The Important Questions?
The Important Questions?
• A $150 million investment becomes $6 billion
A $150 million investment becomes $6 billion
in 5 years!
• You would have leadership positions in a
You would have leadership positions in a
variety of industries !
• A
Are such opportunities still there ?
h ii ill h ?
• What about global factors?
• Where are the opportunities ?

9. Electronic Media Industry Case Study:
Electronic Media Industry Case Study:
• Pathetic Market capitalization
Pathetic Market capitalization
• Sector plagued by losses and unbridled
competition
competition
• Distribution concentrated in unorganized
sector
• Content owners, other than cricket, bollywood
and high premium properties getting stiffed.
g g
• Believe “Content will be King.” Again.

10. What is the Game Changer for the
Electronic Media Sector?
l d
• Cab e g t at o
Cable Digitization Bill is passed. (Finally!!!)
s passed. ( a y!!!)
• India to go from Analog to Digital over 3 years.
• Carriage costs to go down for Broadcasters.
Carriage costs to go down for Broadcasters.
• Subscription revenue to improve; pay models to
be introduced.
• Media consumption to move from news papers
to online and electronic.
• Ad spend to GDP ratio will improve as
consumption boom keeps rolling.

11. Select Snapshot of Electronic Media:
Select Snapshot of Electronic Media:
Name Cur Market Cap in Rs Genre
crs
TV Today 360 News
NDTV 300 News
Sun TV 11300 GEC
Zee TV 12106 GEC
TV 18 Broadcast 1587 GEC, Business
Den 991 Cable MSO
Hathaway 1730 Cable MSO

12. Finally:
“ If a man looks sharply and attentively, he
shall see fortune for though she is blind
fortune,
she is not invisible.”
---Francis Bacon
F i B