1. 63rd WORLD NEWSPAPER CONGRESS
Session: Opportunities
Title: Building Brands’ Capital
Speaker: Ravi Dhariwal
Mark your calendar
64th WORLD NEWSPAPER CONGRESS
19th WORLD EDITORS FORUM
Vienna, Reed Messe Wien
www.wan-ifra.org/kiev2012

2. Building Brands’ Capital
Partnering Entrepreneurs
Ravi Dhariwal
THE TIMES OF INDIA

3. India: Prospect
1,34%
Advertising Spends:
GDP ratio 2009
0,95%
0,54%
0,47%
US UK China India
Source: KPMG-FICCI Frames 2009

4. India: Advertising Prospect
• Even established
companies under-
advertise
o < 5% of listed companies
spending 10%+ of
revenue on advertising
• New entrepreneurs cash
strapped
Source: CMIE

5. Brand Capital - Addressing the
Paradox
Business enterprise
Limited Resources.
• TOI provides advertising & strategic
input
• Shares business risks
Brand
Capital
• Preserves Cash
Need for a brand

6. Multimedia Platforms : National
22% Share of Overall Ad Spend
33% Share of Print Ad Spend
30% Share of Radio Ad Spend
Largest TV News Company
Largest Out-Of-Home Company
Among Top 5 Indian Internet Cos.

7. Types of Deal Structures
Equity Structure
– 3-5 years of ad spends : Exchanged for Equity
Asset Structure
– 2-3 years of ad spends: Exchanged for Assets
Performance Contracts Structure
– 1-2 years of ad spends : Performance Based

8. Business Structure I – Equity Listed
Brand Capital
Deal
33% in cash 67% in equity
“Pay as you go"
with every ad
7

9. Business Structure II – Real Estate
Brand Capital
Deal
33% in cash 67% in real
“Pay as you go" estate asset
with every ad
8

10. Business Structure III – Numerator
Brand Capital
Deal
60% in cash 40%
“Pay as you go" performance
with every ad -linked
9

11. Role of Brand Capital
Contribution*
Strategic Finance Advice 17%
Strategic Marketing Direction 33%
Brand Finance 50%
0% 13% 25% 38% 50%
*Indicative ratios

12. Challenges
• Valuing equity of unlisted companies
o Promoters high on expectations
o Few benchmark transactions
o Many PE funds, too few companies
• Promoters reluctance to part with equity
o Not comfortable with dilution
o Equity most expensive funding
• Exit routes of unlisted companies
o Low demand for unlisted companies
o IPO process stretched on implementation time
• Corporate governance of unlisted companies
o Promoters exposed to external investors for the first time
o Corporate governance standards not up to speed

13. Many Brands – One Brand Capital
www.brandcapital.co.in 12

14. Case Studies: She
Category with players like
P&G and J&J, 99% ad
spends in TV
She Comfort is now ranked #
3

15. Case Studies: MCX
Pitted against well-
established first mover
MCX is now India’s #1 &
Asia’s #4 Derivatives

16. Case Studies: Thyrocare
Start-up in a low-
involvement, no
advertisement category

17. Case Studies: Big Bazaar
Heavy competition, high
investment category

18. Case Studies: Mercedes Benz
Growing segment, new
entrants

19. Brand Capital – Scale
• Portfolio 350+ companies
with deal value of US$ 1
billion
• Contributed between 15% of
total BCCL ad revenue over
the last 4 years
• Proven success stories
leading to repeat deals

20. Investments by Industry
19

21. Thank You
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