Company Profile

Zee Entertainment Enterprises Limited is one of India’s leading television, media and

entertainment companies. It is amongst the largest producers and aggregators of Hindi

programming in the world, with an extensive library housing over 80,000 hours of

television content. With rights to more than 3,000 movie titles from foremost studios and

of iconic film stars, Zee houses the world’s largest Hindi film library.

Through its strong presence worldwide, Zee entertains over 500 million viewers across

167 countries. 

Pioneer of television entertainment industry in India, Zee’s well known brands include Zee

TV, Zee Cinema, Zee Premier, Zee Action, Zee Classic, Ten Sports, Zee Sports, Zee Cafe, Zee

Studio, Zee Trendz, Zee Jagran, Zing, ETC Music and ETC Punjabi. The company also has a

strong offering in the regional language domain with channels such as Zee Marathi, Zee

Bangla, Zee Telugu, Zee Kannada, Zee Talkies and Zee Cinemalu.

The Zee stable owns an integrated range of businesses. All of these in singularity adhere to

the content-to-consumer value chain model of media and entertainment business. Zee is a

pioneer in every aspect of content aggregation and distribution through traditional media

like satellite and cable and new media like the internet, in India.

ZEE is

The largest producer and aggregator of Hindi programming in the world, with more than 80,000 hours of original programming in its archives.

One of the most popular entertainment brands in India; was ranked 9th most popular brand within a decade of its launch.

One of the largest Indian programming content distributors with an estimated reach of more than 500 million viewers in over 167 countries including USA, Canada, Europe, Africa, the Middle East, South East Asia, Australia and New Zealand.

Zee has many 'firsts' to its credit

º First listed media company in India.

º First to launch a Hindi General Entertainment Channel in India - Zee TV.

º First to launch a Hindi Cinema Channel in India - Zee Cinema.

º First to corporatize the Hindi film industry with the costliest production and the highest grossing Hindi movie in its time - 'Gadar - Ek Prem Katha'.

º First to launch a 24 hour Hindi News Channel in India - Zee News, now operating as a separate company called Zee News Limited (ZNL).

º First to set up MSO operations at a national level - Siticable, now has transferred its business to a separate company called Wire and Wireless (India) Limited (WWIL).

About Essel Group

Essel Group is among India’s most prominent business houses with a diverse portfolio of assets in media, packaging, entertainment, technology-enabled services, infrastructure development and education. The Group started business in 1976 with a commodity trading and export firm, Rama Associates Limited, and has since then metamorphosed into a conglomerate that is a symbol of the ingenuity and power of Indian entrepreneurship, with worldwide operations and a workforce of nearly 8,000 dedicated employees.

Mission & Values

To be the leading round the clock airtime properties provider and delight the viewers not only through our general entertainment and infotainment channels, but also through quality cinema from our movie banners.

As a Corporation, we will be profitable, productive, creative, trendsetting and financially sound with care and concern for all our viewers and stakeholders namely advertisers, cable operators, producers and production houses.

Our Values

Customer Focus:Our Company's strategies are driven by the needs of the customer. Our success can be measured by the satisfaction achieved by our customer.

Excellence:We accord a high premium to maintaining superlative standards throughout our Company. We encourage our employees to come up with smarter ideas within the fastest possible time.

Creativity:Key to our value system is innovation and originality. We recognise and have a high regard for individual expression and creative freedom in our quest to provide customer satisfaction.

Integrity:We observe strict ethical standards through editorial independence and creative expression, in order to earn the trust of our viewers and subscribers.

Growth Driven:We are committed to delivering consistent revenue and cash flow growth in order to provide our shareholders a good return. Our objective is to grow our people, market and businesses around the world.

Strengths & Strategies

Zee’s Strengths

* Leading broadcaster in India and overseas for South East Asian content* First mover advantage across genres* Widest offering of channels by a single broadcaster in the country* Across genres, our channels are either leaders or strong contenders for the leadership Position* Diversified revenue streams: advertising and subscription* Diversified customer base:across167 countries* Operating the largest pay TV distribution platform in the country, Zee Turner* Large network gives tremendous leverage with advertisers * Cost conscious approach towards business* Affiliate companies have leading presence across the media value chain cable and distribution, direct-to-home satellite services, digital media amongst others                              

Zee’s Strategies

* Inspire creativity

* Continue to run our business as best in class, with viewer satisfaction as the ultimate goal. * Enhance our leadership position in the genres we compete.* Continuous innovation to stay ahead of the curve and seize growth opportunities* Invest in the business in a focused, disciplined way and achieve superior financial performance.* To use the strong cash flows of our business to improve returns to shareholders * Reaffirm our commitment to highest level of integrity and professionalism throughout our business.

History

The year 1992 ushered in an upheaval of sorts in the country. With the political, social and economic landscape changing facades, an upsurge in the world of media and entertainment was waiting to burst open. An upsurge that would resculpt social drifts and impart new meaning to TV viewing in India. Subhash Chandra, one of India's leading entrepreneurs, who sought to create a revolution by facilitating the convergence of media and communication with a mirror into the common man's life and ways, created Zee Telefilms Limited in October 1992. This enterprise was to act as the chief content provider for Zee TV - India's first Hindi satellite channel. Zee Telefilms Limited (ZTL) is now known as Zee Entertainment Enterprises Limited (ZEEL).

Very early in the aftermath of launching ZTL, Subhash Chandra entered into a joint venture with the STAR group of companies. This pact was to augment television broadcasting in India and deliver higher quality of programming content. In another development around the same time, media mogul, Rupert Murdoch's News Corp Limited acquired the rights to distribute STAR's satellite TV content. This made News Corp a de facto partner of Zee. To strengthen their network further, Zee and News Corp co-founded Siticable, a leading cable MSO. In March 2000 however, Zee bought News Corp's stake in both the broadcasting business and Siticable.

Zee, over the years has built a diverse portfolio of leading businesses and has driven initiatives that increase efficiency at every juncture of development. Zee has established a very strong consumer connect and is governed by a set of values that holds them in good stead in the face of changing viewer environments.

Key Milestones

2007:Zee Entertainment Enterprises Limited (ZEEL) gets listed as an independent company. 2006:De-merger of Zee Telefilms Limited (ZTL) initiated. 2003:

Launches 5 new channels for the DTH market viz. Action cinema, Classic cinema, MX, Premier cinema and Smile TV.

Enters into a distribution tie-up with Rajshri Pictures for theatrical distribution of films in India.

Launches 'Trendz' - A premium fashion and style channel, targeted at the fashion conscious Indian consumer. 2002:Acquires controlling stakes in ETC Networks Limited and Padmalaya Telefilms Limited. 2001:Introduces Zee TV and Zee News as pay television offerings. 'Gadar - Ek Prem Katha' became highest grossing box office movie. 2000:Launches Internet over Cable services - Becomes first cable company in India to do so.

Enters into content distribution joint ventures with MGM and Viacom.

Launches pay bouquet of channels in the Asian region of working. 1999:Acquires News Corp's 50% stake in joint ventures of their television broadcasting business tie-up.

Launches regional channels. 1998:Launches Zee TV in the US.

Institutes a prime award in the film segment called 'Zee Cine Awards'. 1997:Launches Zee Music (originally called Music Asia). 1996:Starts first cable channel in India - Siti Channel. 

Launches Zee TV, Africa. 1995:Commences Siticable operations Joint Venture with News Corp.

Launches Zee News and Zee Cinema.

Zee TV goes global - launches Zee TV, UK 1992:Launches Zee TV - Initial Public Offering of Zee Telefilms Limited.

Company Facts

As India's first and the country's largest fully integrated media and entertainment

company, Zee Entertainment Enterprises Limited's unique combination of businesses and

growth opportunities both in India and globally, give us a unique position in the global

media space. From Zee TV, Zee Cinema, Zee Music to Zee sports and Ten sports, from ETC

Networks to English Channels, our Company brings together the most valuable media

brands, which will support our commitment to deliver consistent growth.

Employees1150 + (This includes ZEEL and its subsidiaries as per the 27th Annual General Meeting held on August 18, 2009)

LocationCorporate Office: Worli, Mumbai, IndiaRegistered Office: Worli, Mumbai, IndiaGlobal offices: Canada, Hong Kong, India, Singapore, South Africa,United Arab Emirates, United Kingdom and United States of Americai

Stock Exchange ListingEquity Shares of the Company are listed on The National Stock Exchange of India Limited (NSE) and The Stock Exchange, Mumbai (BSE).

Zee Stock – INR 285.80 on Sep 02, 2010

FinanceRevenue INR 21.77 billion (US$ 468 million)PAT for the year INR 5.12 billion (US$ 110 million)EPS INR 8.8 (US$ 0.19)Market Cap INR 46.16 billion (US$ 993 million)

BankersBNP ParibasIDBI BankING Vyasa BankUTI Bank LimitedStandard Chartered Bank

AuditorsIndian GAAP: MGB & CompanyUS GAAP: Deloitte & Touché

Awards

Subhash Chandra awarded the 'Global Indian Entertainment Personality of the Year' by FICCI for 2004.Zee Telefilms was among the ten Indian Companies in the Forbes International 200 Small Best Companies selected from among 20,000 small companies worldwide for the year 2001.Zee awarded "BSE Award for Maximisation of Shareholders Wealth - 2000"Subhash Chandra awarded "Entrepreneur of the Year" by Ernst & Young in 1999Subhash Chandra awarded "Businessman of the Year" by Business Standard in 1999Zee awarded "Emerging Company of the Year" by The Economic Times in 1998The EMMA Award for best digital/cable channel in the United Kingdom for Zee TV by the UK Brand SummitZee TV UK was awarded the MACE (Multicultural Awards for Competitiveness and Enterprise - Leadership in Best Practice) sponsored by the UK Trade and Investment.Zee awarded "Ground Breaker Award from Multichannel News International for its achievements in developing programme networks and related businesses"In the Fifth Anniversary issue, Finance Asia, rated Zee Telefilms as the Fourth best company in Asia and as one of the most successful Asian Corporates in producing value for its shareholders.

Board of Directors

Subhash ChandraSubhash Chandra, 59, is the Non-Executive Chairman of the Board and promoter of Essel Group of Companies. His industry leading businesses include television networks and film entertainment, cable systems, satellite communications, theme parks, flexible packaging, family entertainment centers and online gaming.

Laxmi Narain Goel

Laxmi N. Goel, 56, is a Non-Executive Director and one of the promoters of the Company.

He is one of the key architects of the Essel Group of Companies. He started his career in

1969 trading agro commodities and established Rama Associates Limited along with his

brothers.

Ashok Kurien

Ashok Kurien, 59, is a well known personality in the Advertising world. Mr. Kurien is the

Managing Director of Ambience Publicis Advertising Private Limited, which is rated

amongst the best Advertising Agencies of India.

B. K. Syngal

B. K. Syngal, 69, is a Non-Executive Independent member of Board of the Company. He was

the Vice-Chairman of BPL Communications Limited and Chairman of Internet, broadband

and technology solutions businesses at the BPL Innovision Business Group at Bangalore.

N. C. Jain

N. C. Jain 70, a post graduate in Accounts and Law, has 38 years of experience in the Civil Service (as member of Indian Revenue Service)

Senior Management

Punit Goenka

Punit Goenka is currently the Chief Executive Officer (CEO) of Zee Entertainment Enterprises Ltd. (ZEEL). As a part of his journey, Punit has been the catalyst in taking the ZEEL Empire to greater heights

Amitabh Kumar

Amitabh Kumar heads Technology at ZEEL and is responsible for broadcasting operations

of the Company.

Atul Das

Atul Das heads Corporate Strategy & Business Development. He has been with Zee since September 1998 and handles corporate strategy including activities such as alliances, mergers and acquisitions, business planning and investor relations

Atul Pande

Atul Pande is CEO of Sports Business supervising Zee Sports, Ten Sports, Mumbai Football

Cup and All Sports Magazine.

Bharat Ranga

Bharat Ranga heads International Operations based out of Mumbai. He has been with the

Organization since 1998

Alliances & Partnerships

Zee's mission of continued sustainable growth has brought it thus far in the annals of the

media and television history and looks to guide its sails towards a fine future too. An

important aspect of keeping an eye on the future was to foster external acquisitions and

alliances to gain access to quality content and technology. With the home-grown measures

of revenue generation in place and functioning well, this move of external affiliations with

parties that complemented Zee; in philosophy and in business brought in profits and

goodwill alike.

ETC Network

ETC Networks Limited (ETC.BO) is a media company listed on the Bombay stock exchange

operating two television channels, ETC Music and ETC Punjabi in India. Zee acquired a 51%

stake in June 2002. Zee acquired a 51% stake in June.

Zee Turner

A 74:26 joint venture between Zee and Turner International to distribute the Zee Turner pay channel bouquet in India and neighboring countries.A 74:26 joint venture between Zee and Turner International to distribute the Zee Turner pay channel bouquet.

Ten Sports

Ten Sports and Zee Sports combine, have give the viewers a lot of action in the past years

and have become a force to reckon with in the sports entertainment business. Popular

events like WWE, UEFA Champions and League Football have made inroads into the Indian

market. Tennis fans enjoy the grand slams with a series of ATP 500 and a multitude of

other events. For indoor sports fan, the channel has showcased the world poker tour and

darting events. Cricket being nothing less than a religion in India, Ten Sports has acquired

the rights to of the ten cricket boards, giving it over 100 days of cricket a year. This is the

maximum number of days of cricket across sports channels. The right to these 5 boards; Sri

Lanka, Pakistan, South Africa, West Indie and Zimbabwe are with Ten Sports for the next 4

years.

Corporate Responsibility

Zee is of the school of thought that 'you aren't successful if you haven't given back to what you have got from'. The Corporate Social Responsibility (CSR) policy at ZEEL propounds the belief that 'a business cannot succeed in a society that fails'. While falling in line with this thought, Zee feels that all business houses especially in developing countries like India should invest in the future by building society and environment thus lending a hand to the comeuppance of a bright, shining tomorrow.

A few CSR initiatives undertaken by the group:

Zee Touch India Initiative:

Knowing that Zee entered millions of homes worldwide and was welcomed and cherished in each of them, it decided to put this reach and goodwill to some charitable use. Zee launched the Touch India Initiative by virtue of which various organisations and social bodies could air films focussing on social causes on all available Zee channels without paying for the airtime.

Some of the Public Service Ads featured are:

º Campaign on breast cancerº Campaign for the visually impairedº Campaign for HIV/AIDS for the international Aids dayº Aids awareness campaign by Mukti Foundationº Campaign on pulse polio

Education:

Ekal Vidyalaya Foundation of India (EVFI) is a charitable organisation dedicated to

emancipating nearly 8 lakh tribal children through one teacher schools across 26,000

villages in India by way of imparting free education and developmental means of life. Zee

has taken EVFI under its aegis and all its group companies and employees either

individually or collectively have embraced a number of these schools. This initiative has

been fuelled by Mr. Subhash Chandra's vision of eradicating illiteracy from the tribal areas

of India by 2011. To that end, Zee also publicises all the good work being done by Ekal

through its channels.

Spiritual Uplift:

Zee is a staunch supporter of the belief that happiness in family life, peace and efficiency at

work comes from peace of the mind. The group has supported the Global Vipassana

Foundation for years. Vipassana is said to be a 2500 year old non-sectarian, rational

process of mental purification through self observation (introspection and abstinence).

These courses have helped many an individual to experience spiritual well-being and peace

within. The group also has taken a policy decision of granting 12 days leave to all

employees desirous of attending the Vipassana course.

Meditation Camps:

A large number of people have benefited from the regular 1 day meditation workshops and

courses that the group organises for children and adults alike.

Zee’s Businesses

Hindi GEC

Zee is the largest producer and aggregator of Hindi programming in the world. With 80,000

hours of original programming in the library, Zee is one of the most popular entertainment

brands in India. It was ranked as the ninth most popular brand within a decade of its

launch, the largest MSO in India with an estimated reach of 6.5 million households, one of

the largest Indian multiple distribution platforms with an estimated reach of 500 million

viewers in over 167 countries globally including USA, Canada, Europe, Africa, the Middle

East, South East Asia, Australia & New Zealand and the only media company which is part

of the BSE-30 Index (Sensex).

Zee TV

Zee TV is the flag-bearer of the Zee Network. It was launched in October 1992. From then

on, it has gained considerable momentum in reaching more than 167 countries and more

than 500 million viewers globally. Its global footprint stands testimony to the fact that Zee

TV has been welcomed into homes and cherished ever since its launch because of the wide

variety of programming that has always served audiences across segments. 

Zee has always offered a bouquet of genres for viewers of all ages and classes. From

primetime comedy to drama, from premier Hindi movies to mini-series and telefilms, from

children's programmes to mythology to musical extravaganzas, they're all in there. 

Zee has always been considered to be a path-breaking innovator with regards to its

programming. Some category based innovations that have done very well include

programmes like 'Sa Re Ga Ma Pa', 'Saat Phere', 'Dulhann', 'Kasamh Se' and 'Maayka'. These

shows have set benchmarks worth admiring in the broadcasting segment. Zee's platter of

mythological shows has been a huge hit with audiences. They have gripped viewers

educating and entertaining them at the same time. 'Ravan', 'Naagin' and 'Aladdin' have

been very well-received and enjoyed. The mission statement of the channel that spells out

the need and importance of building relationships every moment has guided the launch of

successful shows like 'Dance India Dance', 'Chhoti Bahu', 'Agle Janam Mohe Bitiya Hi Kijo',

'Pavitra Rishta', 'Shree' and 'Aap Ki Antara'. With 'Har Pal Banaye Ek Naya Rishta' being the

motto of the channel, programming quality and development keeping in mind the viewers'

emotional inclinations, are key aspects of Zee's success.

The widespread popularity of Zee has come from the cognizance that development of

programming is very well researched and calculated to suit Indian culture, beliefs and the

general ethos of the average Indian viewer. Zee has spread its reach to the UK, the USA,

Africa and a horde of other countries owing to the world wanting to have a dekko at this

insightful effort at creativity. 

www.zeetv.com

Zee Smile

Another offering by the company in the entertainment genre Zee Smile, brings to its

viewers original content and some which is shown on Zee TV. The channel is accessible to

viewers on a free-to-air basis; this in turn provides it a vast viewership. 

Regional GEC

The regional entertainment genre is a nascent vertical. Given the regional diversity in

language, culture and literature in India, there exists exponential growth potential of media

consumption in local languages. This is reflected in the rapid proliferation and growing

viewership of regional media. Increasing advertisers' preference in regional media justifies

the consuming potential of regional media audience. 

Zee Entertainment is already the leading provider of entertainment content across genres

in the Hindi and English languages. With leading channels like Zee Marathi, Zee Bangla, Zee

Telugu and Zee Kannada within its fold, Zee Entertainment would now have an

unparalleled reach across the country in the fast growing regional markets.

This acquisition also provides ZEEL the opportunity to take the regional channels

international and expand revenue streams further. This move is part of ZEELs continuing

efforts to improve long-term shareholder value.

Bollywood

Bollywood - The Indian Film industry is acclaimed as one of the largest film industries of

the world. The industry produces over 1000 films every year which is watched by almost

14 million Indians everyday! Zee, a pioneer of television entertainment industry in India, is

today among the largest producers and aggregator of Hindi programming in the world. It

houses an extensive library with over 80,000 hours of television content.

Zee's Hindi movie channels, Zee Cinema, Zee Premier, Zee Action and Zee Classic maintain

its objective in delivering the best of programming in the Hindi Movies Genre.

Sports

The Group has varied interests in the Sports Business but the main focus has been the

Television Business. With a majority stake in TEN Sports and our in-house channel ZEE

Sports, we offer our viewers the best of sports round the clock. WWE and Cricket on TEN

Sports are the main driver content; whereas ZEE Sports showcases Indian and Foreign

Football (including the UEFA Championss League) and can truly be called the home of

Indian Football. Together the two channels boast of the most varied reach in Indian homes.

English Entertainment

Movies...Fashion...Music...Entertainment...Zee's English bouquet of channels comprises

ALL...Today, Zee Cafe, Zee Trendz and Zee Studio are premium channels of the network,

showcasing the finest English content from across the globe. The channels cater to the

higher SECs of the TV-viewing audience in India. 

Boasting of an expansive library comprising a healthy mix of award-winning films and

mass entertainment movies, to bringing in the latest global trends, seasons of the top rated

shows from the United States to the Indian viewer alongside the LIVE telecast of some of

the most spectacular and sought after world events...Zee English Entertainment has always

aimed to bring in the best of international content to Indian audiences year after year.

Music

Almost a century old, Music has always been an integral part of the Indian culture. From

classical to devotional music, popular bollywood music to remixes...India is the Mecca for

music. Zee's commitment to programming of the highest standards has helped us launched

different product initiatives and enrich the entertainment genres. Zee has strengthened its

bouquet in music genre by launching ETC, ETC Channel Punjabi and Zing. Today our

channels stand as market leaders in their respective genres of music continue creating an

invigorating culture and touching lives of people through music.

Alternate Lifestyle

Spirituality and Religion form an integral part of our culture and life. In today's stressful

life, they help an individual gain insight into his/her inner life, thereby helping them to lead

a balanced life. Through regular practices of meditation and prayers, an individual is able to

handle all kinds of stress and deal with the adversities of life in a better way. Our Alternate

Lifestyle genre is aimed at awakening people to realize the spiritual aspects in their life and

hence enriching lives.

Indian Filmed Entertainment

Zee Entertainment Enterprises Limited has launched Zee Entertainment Studios with 2

movie banners – Zee Motion Pictures for mainstream films and Zee Limelight for films

targeted at niche audiences. 

Hindi movie viewing in India has changed as an attitude and method. Multiplexes and

digital cinemas have augmented the quality and quantity of movie viewing. The growth of

ancillary markets like home entertainment, mobile music, satellite rights, growth of

international revenues and the entry of well funded corporations that are aiming to

consolidate the business have changed the scenario and made it a profitable corporation in

itself. 

What makes the foray of the Essel Group in the movie business interesting and most logical

at the same time is the fact that the Essel Group is already a major player in theatrical

exhibition (E-City and Fun), television content and distribution (Zee Network), cable

distribution (WWIL), direct to home (DTH – Dish Network) and has an enviable global

footprint.

The new banners will support and have a strong influence of regional growth. The new

banners will focus on script development, talent and film acquisition, production,

distribution and marketing of films in initially Hindi and 5 regional languages – Telegu,

Tamil, Kannada, Bengali and Marathi. Managing all rights including music, video/ DVD,

satellite/ cable/ pay-per-view, hotels/ airlines, mobile and internet, executing the business

globally.

The aim is to be associated with 20 films in the first year in 6 languages and will eventually

be transposed in 15 domestic and international locations.

International Business

Spanning 5 continents, Zee reaches out to more than 500 million viewers in more than 167

countries. The South Asian diaspora is spread across the length and breadth of the world

and is of relevance in most countries both financially and culturally. In the UK and the US,

South Asians form one of the most respected and professionally accomplished

communities. In other parts of the world like Africa and Hong Kong, they are among the

wealthiest sections of society.

South Asians have a strong sense of attachment with their roots and origins. This manifests

itself through art, music, theatre and dance. Asians in the UK are very traditional and have

maintained strong ethnic values because of their religious and cultural heritage. They also

have a very strong community and sense of familial togetherness. Movies, songs, festivals

and fairs are an integral part of entertainment and social gathering in day to day life.

Zee has always endeavoured to network Indians worldwide and bind them by the values of

culture. Hand in hand, Zee has provided them with the best entertainment.

Chairman's Message

Dear Shareholders,

It has been a significant year for the television media industry in India. More than six

million households converted to digital pay TV and total households on digital pay TV are

estimated at 14 million. It gives me great satisfaction to present the fact that India is the

third largest television market in the world and despite the size, is one of the fastest

growing markets. TV penetration in India is currently only 55%, and cable and satellite TV

penetration is a mere 35%. Going forward consumption growth fuelled by a steady growth

in Indian economy would ensure a much greater number of television households. 

Your company is one of the foremost players in the television media and entertainment

space in the country. Zee's strong strategic and financial position gives us great confidence

in our ability to benefit from this growth opportunity. 

A year of turmoil for the global economy 

In the financial year 2009, the world economy went through difficult times. The

International Monetary Fund (IMF) has stated that the global economy faces its worst crisis

since World War II and will shrink by 1.3 per cent in 2009. In today's business

environment, it is seldom possible for large corporations to be insulated off pressures faced

by the global macro-economy. The comforting part for us is that India is relatively

unaffected and trends indicate that the country's GDP growth will outperform that of many

other emerging economies. 

Indian media was impacted, though to a relatively lesser extent 

While India remained largely unaffected during the first half of the fiscal, we did see the

impact of global economic meltdown during the second half. Coming after several years of

continued growth, the year brought its own set of challenges. Spends from sectors like real

estate and banking and financial services were severely affected and advertising revenue

growth of most media companies saw a dramatic slowdown. While the calendar year 2008

witnessed an 18% growth in television advertising spends, the opinion is divided on the

expected growth during calendar 2009. 

Media and entertainment sector: Entertainment Unlimited 

The Indian media and entertainment industry continued to grow in scale and size during

the year. Within the media and entertainment sector, television, given its wider spread and

ever increasing reach, showed higher growth as compared to other media vehicles. An

important trend in the broadcasting industry was the growing preference for digital

services. 

India now has over 120 million television homes and over 80 million of these homes have

cable and satellite connections. Digital pay TV homes have also grown to significant

numbers with an estimated 12 million homes on DTH alone as of March 2009. There were

several new channels launched during the year both in Hindi and regional languages and

the appetite for entertainment continued to grow. The Hindi GEC genre attracted new

players owing to its popularity among viewers and advertisers. 

The entertainment industry is witnessing a big transformation lead by technological

advancements, new delivery platforms and growing diversity of content. Consumer

expectations are also changing rapidly. While consumers are spending more on media and

entertainment, they also want more control, choice and pricing flexibility. While these

changes are posing new challenges for media companies, they also open up new

opportunities. 

Zee performance, year of consolidation 

Fiscal year 2009 saw improvements across a number of key operating metrics. We

continued to deliver strong operating results, with most of our businesses performing as

per expectations. The year also saw emergence of new competition in the Hindi

entertainment space. While Hindi entertainment genre recorded higher viewership,

television penetration increased and there was greater adoption of digital television,

advertising revenue growth was impacted due to the overall economic slowdown. Zee

focused on consolidating its market share across genres and continued to build on its lead

in international markets across the globe. 

It has been a very unique year for us and for the industry. On the one hand we witnessed a

considerable slowdown in the advertising revenue growth trajectory, particularly during

the second half of the fiscal, while on the other we continued to record robust growth in

subscription revenues. From a 30% plus growth in advertising revenues in the first half, we

saw the growth fade away during the second half of fiscal 2009. Increased competition has

also impacted industry margins during the second half of fiscal 2009. 

During the year the overall revenues of the company grew by 18% over the last year. Of the

two primary sources of revenues, advertising revenues grew by 14% over the previous

year while the subscription revenues grew by 23%. It was encouraging to note that our

subscription revenues earned from various DTH operators increased by 93% over last

year. International subscription contributed 21% to our revenues. The overall operating

profits of the company were flat as compared to the previous year and the profit after tax

increased by 31% on a yearly basis. 

We took a series of steps to streamline our operations. Towards the end of the year, we

were able to reduce our selling, general and administrative expenses. We have also

consciously focused on improving efficiencies in content acquisition, one of the biggest cost

elements. With the steps we have taken last year, Zee is now a leaner and more tightly

focused company. 

Focus on People and human capital 

We believe that having the right people in the right positions doing the right things is

critical for success of any enterprise. We need a very creative and technology savvy

leadership team to tap the opportunities. Every media executive needs to balance creativity

with technology and yet be mindful of the costs. Those who can balance these skill sets

would create value in the long term. We continue to work towards enhancing the

capabilities of our global workforce. 

Your company has taken a series of initiatives to consolidate the talent management

initiatives. The Board has recommended issuing of Employee Stock Options Plan (ESOPs)

to deserving employees to create a greater degree of ownership. We have also initiated

creation of a talent map for all the positions which will be synchronized with talent map of

employees who are holding these positions. These efforts have already started showing

positive results in the Company. 

Corporate Governance 

Sound principles of corporate governance are vital in the long term success of any

Company. Our endeavour continues to maintain transparency and secure trust of our

investors, employees, customers and public at large. Your company is in full compliance of

the Corporate Governance Code laid down by SEBI and stock exchanges. 

Looking ahead - Committed to sustained growth 

Over the past 17 years, we have built a history of delivering growth. Our content businesses

are leading players in each of their genres and our strong strategic position gives us great

confidence in our ability to succeed in the medium term, despite a weak economic climate.

Given the growing television penetration in India and the rapid digitization of distribution

through DTH and digital cable, your company would continue to focus on aligning its

strategy to take a significant share of emerging subscription revenues. 

Zee's objective is to create long term sustainable shareholder value. During the year, we

have taken important steps to move out of areas which were not yielding results and move

into areas of greater long term potential. We continue to make judicial investments in our

core assets. We plan to build on the success of our businesses by continuing to produce the

most compelling content for our consumers. While the times are difficult, we are hopeful of

an early recovery. Collaboration, consolidation and digitization are the key words for the

industry in the coming year. 

I want to end on a note of thanks to all of our shareholders, employees, customers and

partners for the continued support in our journey. 

Sincerely,

Subhash Chandra