According to people familiar with the situation quoted by the Wall Street Journal, Walt Disney is apparently considering a variety of strategic options for its Star India company, including potential plans for a joint venture or a sale. The firm has held conversations with at least one bank to find ways to expand its India business while also splitting some of the costs involved.
It is yet unknown exactly which particular choices Disney would explore in respect to its Indian business even if the conversations are still in their early stages. The popular Disney+ Hotstar streaming service and Star India make up the conglomerate's India operations. Disney acquired Star India in 2019 after purchasing the entertainment assets of 21st Century Fox.
According to the WSJ article, Star India expects its entire revenue for the fiscal year ending September 2023 to fall by around 20% and wind up at little less than $2 billion. Additionally, it is anticipated that its profits before interest, taxes, depreciation, and amortisation (EBITDA), which were around $200 million last year, will drop by almost 50% this year.
The article also states that Hotstar anticipates losing 8 million to 10 million customers during its third fiscal quarter. These occurrences highlight the difficulties Star India, which changed its name to Disney Star the year before, encountered. The media conglomerate's operations in India include a large number of television channels and a stake in a well-known film production firm.
Disney is aggressively taking cost-cutting initiatives, along with other participants in the streaming and media industries, in response to the negative effects of macroeconomic variables on advertising income and subscriber growth. The corporation launched a substantial reorganisation initiative in February that would result in the loss of 7,000 jobs while saving $5.5 billion in costs.
The fact that Disney is considering strategic options seems to have strengthened investor confidence, as the company's shares ended Tuesday up 1.6%.
