08.10 · Telecom, media & internet platforms¶
Sector playbook. Telecom is a three-player market whose profits now depend on tariff discipline (a ~15% hike was the 2026 base case) and whose weakest player survives on government forbearance; media is being reshaped by streaming and the JioStar combination; internet platforms are the 2021 IPO cohort growing into their valuations — or not. Metrics: ARPU, subscribers, capex intensity; GMV, take rate, contribution margin. As of September 2026.
Time: ~70 min · Prerequisites: 07.4 High-growth & loss-making companies, 07.6 §4 Telecom
1. Telecom¶
| Item | Notes |
|---|---|
| Structure | Reliance Jio (~40%+ subscriber share), Bharti Airtel (~35%), Vodafone Idea (~18%), BSNL (residual); Jio and Airtel take essentially all the industry's cash profit — verify current TRAI shares |
| ARPU (Q1 FY27) | Airtel ₹264 (highest), Jio ~₹210–215, Vi ₹177 (TelecomTalk); industry expects a 10–20% tariff hike in 2026 (Multibagg) |
| KPIs | ARPU; subscribers (total, active/VLR, 4G/5G, postpaid mix); churn; data usage per user (Jio ~44 GB/month); EBITDA margin (Airtel India mobile > 55%); capex intensity (5G build tapering from 2025); net debt incl. spectrum and AGR; Africa (Airtel), home broadband and enterprise (both), FWA (Jio AirFiber) |
| Drivers | Tariff hikes (the only lever that moves industry revenue — three since 2019); subscriber migration from Vi to the leaders; 5G monetisation (weak so far); spectrum auctions and renewals; AGR/regulatory dues; government policy toward Vi (equity conversions 2023 and 2025 raised the government's stake — verify current %; bank guarantee waivers; AGR relief debates) |
| Valuation | EV/EBITDA (8–12x for the leaders, verify) with spectrum liabilities in EV; DCF with capex fade; SOTP for Airtel (India mobile, Africa, Indus Towers stake, broadband); Vi on the Merton option lens (06.7; case I10) |
| Red flags | Subscriber counts inflated by inactive SIMs (use VLR); capex "guidance" that keeps slipping; AGR/dues accounting (provision vs contingent); related-party payments within the Reliance group (Jio Platforms is not separately listed — verify) |
| Adjacent | Towers (Indus Towers: tenancies, Vi receivables); fibre/data centres; Tata Communications (enterprise) |
2. Media & entertainment¶
| Segment | Economics | KPIs | Companies (verify) |
|---|---|---|---|
| Broadcasting (GEC, news, sports) | Advertising (macro + share) + subscription (NTO-regulated pricing) | Viewership share (BARC), ad revenue growth, subscription revenue, content cost; the JioStar merger (Disney Star + Viacom18, 2024) created a dominant TV + streaming + sports player — verify structure | JioStar (unlisted; within Reliance), Zee (post the failed Sony merger), Sun TV, TV18/Network18 |
| Streaming (OTT) | Subscription + AVOD; content arms race | Subscribers, ARPU, content spend, churn | JioHotstar, Netflix/Amazon (unlisted), Zee5, SonyLIV |
| Films & exhibition | Box office (share to exhibitors), F&B, advertising | Footfalls, average ticket price, SPH (spend per head), occupancy, screens | PVR Inox |
| Advertising (declining structurally) + circulation | Ad yields, circulation, newsprint cost | DB Corp, Jagran, HT Media | |
| Radio, outdoor, gaming | Advertising; real-money gaming hit by GST (28% on deposits, 2023) and the 2025 online-gaming law banning real-money games — verify | Nazara (gaming), ENIL |
Valuation: EV/EBITDA and P/E for broadcasters and exhibitors with content-cost cycles normalised; platforms per 07.4. Red flags: content capitalised and amortised aggressively; receivables from group distributors; promoter pledges (the Zee saga 2019–24).
3. Internet platforms¶
| Company (verify all facts) | Model | Metrics to track | State of play (2026) |
|---|---|---|---|
| Eternal (formerly Zomato): food delivery, Blinkit, Hyperpure, District | Take rate on GOV; ads; quick-commerce dark stores | GOV growth by segment, contribution margin per order, adjusted EBITDA by segment, dark-store count and maturity, ESOP cost | Food delivery profitable; Blinkit's expansion and competition with Instamart/Zepto set the burn; the quick-commerce market ~$3.7 bn in 2026 with Blinkit ~45–50% share |
| Swiggy: food delivery, Instamart | Same | Same; cumulative losses and cash runway | Loss-making at group level; Instamart the burn centre (07.4 Dhruv example) |
| Paytm (One97) | Payments (UPI, devices), lending distribution, marketplace | GMV, merchant devices, loan distribution, take rates, regulatory status | Rebuilt after the RBI's Jan-2024 action on Paytm Payments Bank (case I8) |
| PB Fintech (Policybazaar, Paisabazaar) | Insurance and credit marketplaces; commission-based | Premium sourced, renewal rates, take rate, contribution margin | Profitable; regulatory changes in insurance distribution |
| Nykaa | Beauty and fashion e-commerce + retail stores | GMV, orders, AOV, contribution margin, fulfilment cost | Growth slowed vs 2021 expectations; profitability thin |
| Info Edge (Naukri, 99acres, Jeevansathi, Shiksha; Zomato/PB stakes) | Recruitment classifieds (network effect), plus a venture portfolio | Naukri billings, IT hiring cycle, stakes' market value | Holdco-plus-operating: SOTP (07.5) |
| Others | IndiaMART (B2B classifieds), Zaggle, MapmyIndia, Ola Electric (autos), Delhivery (logistics), CarTrade, Honasa (D2C) | Segment-specific |
Drivers: internet-user growth and monetisation, UPI/payments regulation (MDR debates), competition (quick commerce is the 2025–26 capital war), take-rate pressure, ESOP dilution, and regulation (gaming ban, data rules, e-commerce FDI rules, app-store/commission regulation). Valuation: 07.4 — contribution margin per unit, path to profitability, implied terminal margin, dilution; SOTP where segments differ (Eternal, Info Edge).
4. Accounting quirks¶
Telecom: spectrum as intangible assets with deferred liabilities; AGR provisions vs contingents; Ind AS 116 tower leases; capitalised network costs; revenue from prepaid recharges (deferred until used). Media: content capitalisation and amortisation policies; sports rights amortisation; NTO-driven subscription accounting. Platforms: gross vs net revenue (Ind AS 115 principal/agent — food delivery revenue is net of restaurant share; marketplace GMV is not revenue); delivery-partner costs; ESOP charges; "adjusted EBITDA" definitions; one-off gains on stake sales (Info Edge, Eternal's investments).
5. Red flags¶
Telecom: ARPU growth only from tariff hikes while subscribers leak; capex deferrals; Vi's receivables at towers and vendors. Media: ad growth lagging viewership; content write-offs; promoter pledges. Platforms: GMV growth via discounts booked as marketing (or netted from revenue), take rates falling, contribution-margin definitions changing quarter to quarter, cohort disclosure dropped, ESOP grants accelerating before a price rise, related-party dealings with founders' other ventures.
6. The 10-question sector checklist¶
- Telecom: ARPU trajectory, tariff-hike timing, and the split of ARPU growth between price and mix?
- Subscriber quality: VLR/active share, churn, 5G/4G mix?
- Capex intensity and free cash flow after spectrum payments?
- Total liabilities including spectrum and AGR; government stake and forbearance risk (Vi)?
- Media: ad-cycle position; subscription regulation; content-cost trend vs revenue?
- Platforms: contribution margin per unit and its trend — rebuilt from the P&L?
- Cumulative burn, cash runway, and the dilution path (ESOPs, rounds)?
- Take-rate and regulatory risk (commissions caps, payments regulation, gaming law)?
- Competition: who is subsidising, with what balance sheet, and for how long?
- What terminal margin and growth does EV/Sales or EV/EBITDA imply, and has anyone achieved it?
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