As business news goes, a company declaring a 15 per cent dividend 142 days after it lists is compelling stuff. TV Today Network, part of the India Today Group that publishes this magazine, has done just that. The dividend was the yield of a year when revenues grew 30 per cent to Rs 142.52 crore. Other figures are as impressive: a net profit of Rs 32 crore and an operating profit margin of 44 per cent. ''If the company is able to deliver these kind of results for the next three-to-four quarters, investor perception about the entire media sector as a relative non-performer may change,'' says Jigar Shah, the Head of research at Mumbai brokerage K.R. Choksey.

Hindi news channel Aaj Tak is at the core of this success. ''Time and again, we have proved that Aaj Tak has the ability to run better and faster than the competition,'' says G. Krishnan, CEO, TV Today. The channel has lost some share to its rivals-its average share of viewership has declined from 40 per cent in May 2003 to around 28 per cent today-but it remains the leader. ''Marketshare is always relative and, in isolation, an inaccurate measure to measure performance,'' says Krishnan. ''When we had a 40 per cent marketshare we used to deliver lesser eyeballs as we do now at 30 per cent.'' And the channel delivers when it matters. On May 13, the day the results of India's general elections were declared, Aaj Tak's share went up to 37 per cent, almost twice #2's. Then, as Anita Nayyar, Managing Director (North & East), Starcom, a media-buying agency points out, ''Aaj Tak continues to be very strong with advertisers because their own sales networks have faith in it.''

The competition is unconvinced. ''We carry 150 stories a day compared to Aaj Tak's 50 or 60,'' says Laxmi N. Goel, the Head of Zee News, making a pitch for editorial supremacy. ''And 4,500 boxes measuring viewership in an universe of 45-million cable homes means there are serious issues,'' he adds, taking a pot shot at the way viewership is measured. NDTV couldn't respond to BT's questions because it was in the silent period preceding the announcement of its results. For the nine months ended December 2003, the company made a loss of Rs 46.4 crore on revenues of Rs 37.13 crore.

TV Today isn't without its share of problems. Its English channel Headlines Today had its share of teething problems although data indicates that it has started delivering results in recent weeks. Its last measured viewership is almost equal to CNBC TV 18's.

Aaj Tak's success, ironically enough, worries some media buyers who see clutter on the channel adversely affecting quality of advertising exposure. And the company has not made much headway into southern markets (some 20 million cable homes).

Krishnan believes all these can be addressed. Headlines Today, he explains, is targeted at the young viewer from sec (socio economic category) A and B in the top six metros, a viable positioning. The company is restricting advertising on Aaj Tak to a maximum of 18 minutes an hour, building special packages around events such as the Union Budget and working on a new look for Aaj Tak that will be unveiled sometime in July.

Nor is Krishnan worried about growth. TV Today is eyeing international opportunities for improving its revenues and may become a pay channel in India if the Conditional Access regime kicks in. Headlines Today could help the company improve its showing in the south where viewers prefer regional language news channels or English ones. At Rs 50-60 crore, the English news channel ad market isn't something TV Today can ignore, and Krishnan claims the company is ''now showing the same aggression with which we launched Aaj Tak to Headlines Today''.

Not all challenges facing TV Today are external. There's the issue of its low-cost model, built around a lean team paid adequately, not lavishly, coming under fire. ''Employee costs shooting up is an area of concern,'' says Sanjeev Prasad, an analyst at Mumbai-brokerage Kotak Securities. Krishnan admits that employee costs have risen by around 38 per cent in 2003-04, but at 25 per cent of total costs (for 2003-04) this is far lower than NDTV's 40 per cent (for nine months ended December 2003).

Can TV Today retain its edge? ''I am very confident we will not only retain leadership but continue to grow,'' says Aroon Purie, Chairman and Managing Director, TV Today. ''We have a great team in place and it will deliver the results.'' At the moment, the stockmarket, the final arbiter in such matters in free markets believes so. As this article goes to press, the TV Today stock is quoting at a price-earnings multiple of 19.7. That's almost the same as Mphasis.

-Shailesh Dobhal

Home-body
If you're the kind that thinks the only thing that tastes better than a Big Mac is a Big Mac eaten at home, we've great news for you.

Everyone is going direct-to-home (DTH), and we do not mean the eye-in-the-sky satellite channel thingamajig. Taking a leaf out of the books of every pizza company worth its pepperoni (simply too many to enumerate), local Udupi, Punjabi-chinese, and Mughlai restaurants, and neighbourhood grocers and pharmacists, a clutch of companies has decided that Indian customers crave the home-delivery option. So, following the footsteps of Sangam, a HLL home delivery initiative (restricted to certain areas in and around Mumbai), Pantaloon Retail's Food Bazaar launched the Food Bazaar on Call service in early June in Navi Mumbai-it travels to Gurgaon next. "We will be focussing on new colonies rather than old ones," says Kishore Biyani, Managing Director, Pantaloon Retail. "Local kiranawalas are deeply entrenched in the latter." In early May, McDonalds went DTH too in one Mumbai-borough and soon after extended this across all its outlets in the city. "The idea is to allow our customers to enjoy a McDonalds meal, even if they cannot make it to a restaurant," says Amit Jatia, JV Partner and Managing Director, McDonalds Western Region, who is betting on sales increasing by 10 per cent to 15 per cent. That, the fact that home-delivery increases the size of a company's opportunity, could be one reason why everyone is in a rush to go DTH. An, incremental business of 15 per cent isn't something anyone can afford to ignore.

-Priyanka Sangani

Where's The Pay-off?
The IPO may prove a windfall for Tata trusts and group companies, but what's in it for TCS?

TCS' S. Ramadorai: High hopes

When companies make initial public offerings (IPOs), you would like to believe that they will in many ways benefit from the proceeds of that issue. After all, the funds collected can be used for expansions, acquisitions, brand-building and so on. So the IPO of Tata Consultancy Services (TCS), which is expected to raise some Rs 5,000 crore, is unusual (to say the least) in the sense that a week after the billion dollar-plus Tata jewel filed a draft prospectus with the Securities & Exchange Board of India (SEBI), the last question on prospective investors' minds is: But what's in it for TCS?

That's simply because it's difficult to ignore that the biggest beneficiary from the IPO isn't turning out to be TCS but Tata Sons-of which TCS was once a division-the trusts that hold 66 per cent in Tata Sons, and other group companies like Tata Power, Tata Tea and Tata Steel, who own bitsy stakes in TCS. The trusts directly own 6.5 per cent. And as far as the proceeds of the IPO go, analysts point out that a fair chunk of the money raised will be utilised for funding the Tatas' giant ambitions in the cash-guzzling business of telecom.

So what's in it for TCS? In fact, you have to wonder how this conservative software services pioneer is going to deal with the pressures from the finicky analyst community, which lives from quarter to quarter, even as it expects guidance for the entire year ahead. TCS officials weren't available for comment (it's the "quiet" period), but observers maintain that for the past couple of years the company has been honing its act precisely for this occasion. For instance, S. Mahalingam was anointed Chief Financial Officer (CFO) of TCS, with the clear-cut mandate of preparing the company for Dalal Street.

The IPO will also help TCS become more recognisable as a brand under the Tata umbrella, both in India and globally. For a company that has the ambition of being amongst the top 10 consulting firms in the world by 2010, hiring will also be easier as brand awareness increases. After all, TCS will need to have at least 40,000 employees (roughly double today's headcount) across at least 30 countries to hit revenues of $6 billion (Rs 27,000 crore), which is what's needed to enter the top 10. To make the brand visible and known in the west as well as countries like Chile and Uruguay, TCS has hired global pr firm Fleishman & Hillard (a unit of Omnicom).

Clearly, if the Tata companies benefit from cold cash from the TCS IPO, the software major will gain more from the ripple effect the public offering will have in terms of higher brand recall, and the rub-off factor from the Tata brand. But then perhaps wouldn't a part-overseas listing have helped...

-Brian Carvalho