New Delhi: The media and entertainment sector is likely to see an improvement in spending and growth momentum in the December quarter, supported by a late Diwali, a stronger content pipeline and improving monetisation across digital, subscription and sports segments, Nuvama Research said in its October 1 sector preview.
Nuvama expects festive spending to improve in Q3FY27, with the late Diwali likely to support advertising and consumer engagement.
"Due to a late Diwali, Q3FY27 is likely to report some improvement in spends," the brokerage said.
The sector is also expected to benefit from a stronger entertainment calendar, with several major films scheduled for release during the quarter.
Content availability is likely to remain a key growth driver, particularly for cinema and television businesses. Nuvama said the upcoming quarter has a strong line-up of theatrical releases, while the return of major sports events could increase engagement across television and digital platforms.
The brokerage expects sports content to support subscription growth and monetisation. Improving performance in digital platforms could also provide an additional growth opportunity for broadcasters.
The music segment is expected to remain steady, supported by regional content and continued digital consumption. Nuvama noted that while there were no major Bollywood releases in Q2FY27, regional music continued to see strong traction.
Advertising trends will also remain important for the sector. Nuvama expects the weakness in television advertising to start stabilising, helped by favourable base effects and increased engagement around major events.
However, higher advertising spending by some broadcasters could put pressure on near-term profitability. The brokerage said such investments could support growth over the medium term.
Overall, Nuvama expects festive spending, content availability, subscription growth and digital monetisation to drive sector performance in Q3FY27.
The brokerage expects a "decent quarter for most players" as the festive calendar and content pipeline improve.
