 "Eros says will focus on core business")
Eros International, The New York Stock Exchange-listed media entity in the news recently for allegedly misrepresenting its numbers, said the episode was the handiwork of short sellers.
"The audit committee is looking into the matter, so I am not at liberty to disclose anything. But, the episode has made us stronger. This is the first time we have seen something like this and the modus operandi was typical of them (short sellers). Anonymous blogs, twitter posts meant to mislead the investing public. They simply twisted all that we had disclosed in the last few quarters," Jyoti Deshpande, group chief executive officer and managing director, Eros International, said in her first media interaction since the short-selling episode last month.
Short selling involves sale of securities not owned by the seller in the belief that the share price of the company being targeted will decline, allowing the shares to be bought back at a lower price to make a profit.
Deshpande, 44, a media and entertainment sector veteran, who has been with Eros for 18 years, said the company was committed to increasing its pipeline of films, entering new markets, and growing ErosNow, its digital platform.
"We will be free-cash-flow positive at the India level this year and should turn a corner at the Plc level, too, in the near future," she said in response to a specific query on the issue.
The company's trade receivables were under control, Deshpande claimed. "Only $70 million was overdue. Of which $6 million was due over a year and the rest was under a year. We have received payments and our total trade receivables should come down from the $200 million we had indicated in March to $150 million by the end of March 2016," she added.
Eros reported a 155 jump in its net profit to $11 million in July-September from $4.3 million in the same quarter a year ago. Revenue during the period was $98.8 million, up 98 per cent, year on year.
Eros, which produces and distributes Hindi and other Indian-language films, is planning to raise its movie production count from 60-65 to 75 in the next two years and 100 in five years. The company is also looking to go beyond the 50 markets it currently reaches with sub-titled or dubbed versions of its movies and plug content gaps on its ErosNow digital platform, billed as an answer to Netflix.
"From 2016, we will look at producing small-budget films that we can directly release on the ErosNow platform. Plus, we are also looking at a series of originals for the digital platform intended to expand our viewership," Deshpande said.
The move is likely to strengthen its registered user base, which stands at over 30 million. Deshpande said the endeavour was to have users from both India and the Indian diaspora.
The company is expected to keep its television launch plans in abeyance to focus on its core business. "We had indicated in June that we would defer our television launch plans by a year. We will abide by that," Deshpande said.
The stock price of Eros's Indian subsidiary Eros International Media was up five per cent for the second straight day on Wednesday on the BSE after the parent reported its quarterly numbers on Tuesday.
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