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Print ad rate hike: CARE explains how newspapers may benefit from the move

FE Online
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Shares of print media companies including HT Media, DB Corp and Jagran Prakashan rallied up by 20 per cent Wednesday after the Narendra Modi government made an announcement to raise advertisement rates in print media by 25 per cent. The new rates will be effective Tuesday and valid for a period of 3 years. It was last in 2013, an increase of 19 per cent was announced over and above the rates of 2010.

This move to hike advertising rate will bring a rise in operating revenues of newspapers, especially regional and small players which rely heavily on advertising , CARE Ratings said.

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Expectations of heavy spends in advertising from the government during FY19, due to the general election season, will act as a catalyst for the revenue jump of the print industry during the year, it also added.

The print industry hails the much awaited decision to hike advertisement rates. This move will directly boost revenue of print industry, which was valued at ~Rs. 318 bn in FY18. After the TV segment (~37%), print is the 2nd largest contributor to the advertising industry s revenue at ~35%, it also said.

While HT Media ended the day 20 per cent high at Rs 47.10, DB Corp and Jagran Prakashan gained 7.63 per cent and 2.89 per cent, respectively on BSE yesterday.