During Monday’s trading session, the shares of one of India’s leading music labels with an expansive catalogue of over 31,000 songs, surged nearly 3.7 percent to Rs. 880.35 on BSE, after announcing a direct partnership with TikTok to expand its music reach.
With a market cap of Rs. 11,001.2 crores, at 11:50 a.m., the shares of Tips Music Limited were trading in the green at Rs. 860.6, up by nearly 1.4 percent, as against its previous closing price of Rs. 849.
What’s the news:
TIPS Music Limited announced a direct strategic partnership to promote its music library on TikTok, aiming to expand its music reach. This partnership will allow music enthusiasts, Non-Resident Indians (NRIs) and expatriates, to access and engage with TIPS Music’s extensive and diverse music collection on the popular short-form video platform.
According to the latest regulatory filings with the stock exchanges, the agreement between TIPS Music and TikTok is designed to meet the growing global demand for Indian music.
The collaboration ensures TikTok users across multiple regions will have seamless access to the wide range of TIPS Music’s library, which spans genres from Bollywood classics to regional language hits, further enhancing cultural connections and expression through music.
For those who may not be aware, TikTok is currently banned in India, and TIPS clarified that this partnership does not include China or India. TikTok is owned by the Beijing-based company ByteDance.
Financials:
Tips Music reported a significant growth in revenue from operations, experiencing a year-on-year increase of nearly 32 percent, rising from Rs. 61 crores in Q2 FY24 to Rs. 80.6 crores in Q2 FY25.
Similarly, during the same period, the company’s net profit increased from Rs. 39.7 crores to Rs. 48.2 crores, representing a rise of around 160 percent YoY.
Operating EBITDA for Q2 FY25 increased by 19 percent YoY to Rs. 59.5 crores, up from Rs. 49.8 crores in Q2 FY24, but the operating EBITDA margins declined to 73.8 percent, from 81.9 percent, over the same period.
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Key Financial Ratios:
In terms of key financial metrics, Tips Music has a Return on Equity (RoE) of 79.4 percent and a return on capital employed (RoCE) of 104 percent. Additionally, the company’s debt-to-equity ratio stands at 0.02.
Stock Performance:
The stock has delivered multibagger returns of nearly 141 percent in one year, as well as around 102.2 percent returns in the last six months. So far in 2024, the shares of Tips Music have given multibagger returns of about 143 percent.
About the company:
Founded in 1988, Tips Music Limited, one of India’s leading entertainment companies, is engaged in the business of creation, acquisition and exploitation of audio-visual content of music library digitally in India and overseas through licensing on various platforms.
It is the only listed player to expense out 100% of content cost in the quarter of release. Around 75% of Revenue comes through digital platforms.
Written by Shivani Singh
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