JioStar, a subsidiary of Reliance Industries, has flagged a significant burden of Rs 25,760 crore due to sports contracts in its annual report. This amount is approximately 40% of the company’s total revenue for the fiscal year 2022-23. The company has attributed this substantial expense to the costs associated with acquiring and retaining sports broadcasting rights.
The sports contracts in question pertain to the Indian Premier League (IPL), the Board of Control for Cricket in India (BCCI), and other international sports events. JioStar has spent a considerable amount on acquiring these rights, which has resulted in a significant increase in its expenses. The company has also incurred additional costs due to the production and broadcasting of these events.
The annual report highlights the challenges faced by JioStar in managing its sports contracts. The company has stated that the high costs of acquiring and retaining sports broadcasting rights have put a strain on its financial resources. The report also notes that the COVID-19 pandemic has exacerbated the situation, resulting in a decline in advertising revenue and an increase in production costs.
Despite these challenges, JioStar remains committed to its sports broadcasting business. The company believes that sports is a key driver of engagement and revenue growth, and it is essential to invest in this area to remain competitive. JioStar has also stated that it is exploring new revenue streams, such as digital rights and sponsorship deals, to offset the costs associated with sports contracts.
The company’s financials for the fiscal year 2022-23 show a significant increase in expenses, primarily due to the sports contracts. The total expense for the year was Rs 63,315 crore, out of which Rs 25,760 crore was attributed to sports contracts. The company’s revenue for the year was Rs 63,906 crore, resulting in a net profit of Rs 591 crore.
In conclusion, JioStar’s annual report highlights the significant burden of sports contracts on the company’s financials. The high costs associated with acquiring and retaining sports broadcasting rights have resulted in a substantial increase in expenses, which has put a strain on the company’s financial resources. Despite these challenges, JioStar remains committed to its sports broadcasting business and is exploring new revenue streams to offset the costs. The company’s financials for the fiscal year 2022-23 show a significant increase in expenses, primarily due to sports contracts, resulting in a net profit of Rs 591 crore.