@ FICCI Frames: Growth Rates Slow, Projections Tempered In KPMG Report


India’s media and entertainment industry grew at a compounded annual growth rate (CAGR) of 15% during 2006-08 and was, in 2008, a Rs58,400 crore ($12.16 billion) industry, says the annual M&E industry report brought out by industry body FICCI and consultant KPMG. Last year’s edition of the report, which was prepared by PricewaterhouseCoopers, said the CAGR for 2004-07 was 19%.

Even more sobering is the growth projections. While last year’s report projected a 2008-12 CAGR of 18%, this year, the corresponding figure for 2009-13 has come down to 12.5%. That’s a pretty dramatic change in outlook.

The report has also revised projections for India’s advertising industry, whose fortunes are closely interlinked with those of the M&E industry. While last year’s report said the CAGR for 2004-07 was 20%, this year’s report puts the 2006-08 CAGR at 17.1%. That’s small change compared with the slowing in projected growth. CAGR for 2008-12 was projected at 18%, while this year’s report says the industry will grow only at a CAGR of 12.4% during 2009-13. Note how close is the compounded growth rate for the media and advertising industries.

There might be slight differences in methodologies between the PwC and KPMG reports.

Here’s the full sectoral snapshot from the 2009 report (click to enlarge):


Scanning through the 217-page report, here are some quick datapoints.

1) There are now 10 million direct-to-home subscribers in India, and by 2013, this figure is projected to reach 28 million. 10 million is a 150% y-o-y growth, as there were only 4 million subscribers in 2007. Last year, large telcos like Bharti airtel and Reliance joined the DTH bandwagon, which has clearly helped expand the market.

2) In the M&A space, while overall deal volumes dropped in 2008, in the M&E space the number and volume of deals went up. In 2007, there 59 deals were struck, valued at $1 billion, while in 2008, 85 deals happened, at a total size of $1.7 billion. The 12 cross-border deals amounted to $612 million.

Updates will continue through the day. If you are at Frames on any of the days and would like to catch up, drop me a line at sk AT contentsutra.com



KPMG KPMG KPMG/Tax Shelter Tax Shelter Tax Shelter. Of course all the banks are insolvent and KPMG audits a disproportionate amount of them. You thought KPMG’s tax shelter shenanigans were disturbing, such activities were nothing compared to the 100s of Billions of fraud contained in the banks financial statements that KPMG audits. Just remember Flynn and his high priced lawyers tried to help put all the tax shelter partners in prison, what do you think Flynn is going to do to all the Audit Partners who have helped the banks engage in massive fraud by signing off on fraudulent bank financial statements? Though it is difficult to muddle through the fraudulent KPMG bank financial statements, it is not impossible and from that you can profit. Many of us made a small fortune shorting Citibank the KPMG audit client just by understanding the fraudulent nature of Citi’s financials. It is like taking candy from a baby, a favorite KPMG saying.

As one small example for all you dopes who somehow think the system is not and has not always been rigged by liars and thieves, Citi’s 10q as of 9/31/08 shows capital of about $126 billion yet its market cap as of today is $19 Billion (though it is likely insolvent). Forget about FAS 157 there are a million ways around it, the more difficult scam to discern is the use of SIVs to offload bad assets from Citi’s balance sheet so it does not have to recognize the losses. To Citi’s credit it does disclose in footnote 15 of its 10q potential exposure of about $130 Billion for part of their SPEs. Of course such amount is in excess of its stated book capital and almost 7 times larger than its current market cap and likely massively understated.

I know no one saw this coming; you can’t know the unknown; and all KPMG did was follow the accounting rules. Then how come a dope like me could figure it out? Further, that is what the tax partners thought before Tim Flynn, Joe Loonan and Swen Holmes tried to get them put in prison. In fact, many beginning as early as 2005 saw this problem coming like Dr. Roubini and used simple math to explain why. If KPMG is so expert at anything, why didn’t KPMG see this coming and warn all the decimated Citi investors. Personally, I am glad KPMG continued to produce the self evident fraudulent financials because me and my kind made a fortune off all the idiots who think any integrity exists within the fraudulent accounting statements or companies (such statements are reflective of).

In fact, Dr. Roubini is suggesting formally nationalizing all the banks (which most of are already 100% owned on a fair market value basis) because the system is insolvent. It may be time to short these fraudulent companies yet again if he is right, any thoughts?


The following tables summarize the Company's significant involvement in VIEs in millions of dollars:

As of September 30, 2008
Maximum exposure to loss in
significant unconsolidated VIEs
(continued) As of December 31, 2007(1)
Total maximum exposure Consolidated
VIE assets Significant
VIE assets(2) Maximum exposure to loss in
significant unconsolidated
VIE assets(3)
$ — $ 63 $ — $ —
— 35 — —
— 1,385 — —

$ — $ 1,483 $ — $ —

$ 63,462 $ — $ 72,558 $ 72,558
1,337 — 27,021 2,154
2,501 22,312 51,794 13,979
2,034 1,353 21,874 4,762
37,032 4,468 91,604 34,297
16,560 17,003 22,570 17,843
3,430 53 13,662 2,711
2,124 2,790 9,593 1,643
— 58,543 — —
317 140 11,282 212
1,795 12,809 10,560 1,882

$ 130,592 $ 119,471 $ 332,518 $ 152,041

$ 35 $ 604 $ 52 $ 45

$ 162 $ — $ 23,756 $ 162

$ 130,789 $ 121,558 $ 356,326 $ 152,248

Total stockholders' equity 126,062 126,962 (1 )


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