RPG''s Saregama draws up growth strategy
By Our Corporate Bureau | 30 Aug 2005
Kolkata: R P Goenka's entertainment company Saregama India is banking on four initiatives for growth. At the outset films and music would continue to be the main focus areas for the company for greater revenue generation.
Vice-chairman of Saregama Sanjiv Goenka told shareholders at the company's AGM on Tuesday, "We have initiated a project to digitise 3-lakh songs of Saregama and upload a master server from where users can download any song after paying a small price," he said. He added that the price has been kept very low in order to avoid piracy. The total cost has of this project has been estimated at Rs2 crore.
"We will be the first Indian music company to set up such a server," Goenka told reporters here but ruled out buying music rights of high budget films in the near future.
"We have completed 35 per cent of the project and will complete it by this year end," he further said.
Saregama has also decided to get into filmmaking and will produce eight films over the next two-three years, of which two would be in English, one Bengali and rest Hindi. The company has signed up Bengali film-director Rituparno Ghosh who will be associated with the company as script writer and director for a film on Mahabharata character, 'Draupadi' for the global audience.
Other initiatives taken by the company include making efforts to collect royalties from the TV companies for using Saregama's songs. In this context, he said, Sony TV has recently paid such a royalty.
Another area of focus for the company is ring-tone business where it would begin using the old songs that it has in its archives.
The company is also focusing on corporate sales and had already delivered one lakh CDs to ICICI. A similar was struck for the corporate office of the RPG Group.
Goenka said, "Shareholders can expect huge bottom-line growth in the next few years though not top-line growth because a lot of the earnings will be from royalty," he said.
For the year ended March 31, 2005, Saregama recorded a turnover of Rs 100.87 crore a net profit of Rs 5.21 crore.