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MUMBAI: The media and entertainment sector could see a pick-up in spending and growth momentum in the December quarter, with a late Diwali, stronger content pipeline and improving monetisation across digital, subscription and sports expected to support performance, according to Nuvama Research’s 1 October sector preview.
Nuvama expects festive spending to improve in Q3FY27, with the later Diwali calendar likely to boost advertising activity and consumer engagement. The brokerage said the quarter is likely to see “some improvement in spends” on the back of the festive season.
Content availability is also expected to be a key growth driver. The December quarter has a stronger theatrical release calendar, while the return of major sports events could lift engagement across both television and digital platforms.
Sports content is expected to support subscription growth and monetisation, while improving performance across digital platforms could provide an additional growth opportunity for broadcasters.
The music segment is likely to remain steady, supported by regional content and continued digital consumption. Nuvama noted that while Q2FY27 did not see major Bollywood releases, regional music continued to record strong traction.
Advertising trends will remain another important factor for the sector. Nuvama expects the weakness in television advertising to begin stabilising, helped by favourable base effects and increased engagement around major events.
However, higher advertising investments by some broadcasters could weigh on near-term profitability. The brokerage said such spending could support growth over the medium term despite the near-term pressure on margins.
Overall, Nuvama expects festive spending, content availability, subscription growth and digital monetisation to be the key drivers for the sector in Q3FY27.
The brokerage expects a “decent quarter for most players” as the festive calendar improves and a stronger content pipeline provides additional support to the media and entertainment ecosystem.
