At a Glance
Tips Music dropped its Q1 FY26 numbers, and just like a catchy Punjabi track, they’re on repeat: Revenue ₹88 Cr (+19% YoY), PAT ₹46 Cr (+5% YoY), and an interim dividend of ₹4 per share to keep investors humming. But behind the melody, there’s a high P/E of 45x and promoters slowly selling out. The market? Currently playing the remix at ₹602 (-1.4%).
Introduction
Tips isn’t just another record label – it’s a nostalgia machine with a 30,000-song library, film production, and an enviable dominance in Punjabi cinema. But while the songs keep streaming, margins are tightening and the stock has lost some rhythm after its ₹950 high. Q1 shows growth, but investors must ask: is this a platinum record or just a remastered old hit?
Business Model (WTF Do They Even Do?)
Tips earns by:
- Music Royalties: Licensing to streaming platforms, broadcasters, advertisers.
- Film Production & Distribution: Mostly Punjabi films (low cost, high return if hit).
- Rights Monetization: Selling theatrical, satellite, OTT rights.
They thrive on content ownership, turning old tracks into steady cash streams. However, dependency on hits and volatile film revenues add an element of risk to the playlist.
Financials Overview
Q1 FY26
- Revenue: ₹88 Cr (+19% YoY)
- EBITDA: ₹57 Cr (OPM 64%)
- Net Profit: ₹46 Cr (+5% YoY)
- EPS: ₹3.6
FY25 Recap
- Revenue: ₹311 Cr
- PAT: ₹169 Cr
- ROE: Whopping 83%
Commentary: Monster ROE, insane margins, almost no debt – a financial melody. But high valuation and slowing profit growth add a minor chord.
Valuation
- P/E Method
- EPS (TTM): ₹13.2
- Industry P/E: 30–40
- Fair Value ≈ ₹13.2 × 35 = ₹460
- P/B Method
- Book Value: ₹16.4
- P/B Industry: 8–10 (for content-rich companies)
- Fair Value ≈ ₹16.4 × 9 = ₹150
- DCF (conservative streaming growth 15%)
- Fair Value ≈ ₹450 – ₹550
🎯 Fair Value Range: ₹450 – ₹550
Current price ₹602 is slightly over-tuned.
What’s Cooking – News, Triggers, Drama
- Dividend: ₹4 interim, payout Aug 26.
- Streaming Growth: Royalty revenue continues to climb.
- Promoter Sell-Down: Promoter holding down from 75% to 64% in 3 years – not the most encouraging sign.
- Competition: Saregama, T-Series licensing war intensifies.
Balance Sheet
| (₹ Cr) | Mar 2025 |
|---|---|
| Assets | 339 |
| Liabilities | 142 |
| Net Worth | 210 |
| Borrowings | 3 |
Remarks: Almost debt-free, healthy reserves – but tiny asset base compared to its market cap.
Cash Flow – Sab Number Game Hai
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Operating | 81 | 233 | 120 |
| Investing | -48 | -111 | 11 |
| Financing | -43 | -85 | -139 |
Remarks: Healthy operating cash, occasional negative financing flows from dividends & buybacks.
Ratios – Sexy or Stressy?
| Metric | Value |
|---|---|
| ROE | 82.9% |
| ROCE | 109% |
| P/E | 45.5x |
| PAT Margin | 52% |
| D/E | 0.0 |
Remarks: Ratios scream “sexy”, but P/E warns: “Don’t overpay for the tune.”
P&L Breakdown – Show Me the Money
| (₹ Cr) | FY23 | FY24 | FY25 |
|---|---|---|---|
| Revenue | 187 | 242 | 311 |
| EBITDA | 102 | 158 | 207 |
| PAT | 77 | 127 | 169 |
Remarks: Revenue compounding like a viral song, but growth slowing slightly in FY26.
Peer Comparison
| Company | Revenue (₹ Cr) | PAT (₹ Cr) | P/E |
|---|---|---|---|
| Saregama | 1,171 | 201 | 46x |
| Tips Music | 325 | 169 | 45x |
| Balaji Tele | 453 | 94 | 13x |
| Basilic Fly | 304 | 40 | 25x |
Remarks: Tips is expensive, trading at almost Saregama levels with lower revenue.
Miscellaneous – Shareholding, Promoters
- Promoters: 64.1% (falling trend)
- FIIs: 8.1% (increasing)
- DIIs: 4.1%
- Public: 23.7%
Sarcasm Alert: Promoters are humming a “selling” tune, while FIIs are vibing with the beat.
EduInvesting Verdict™
Tips Music is a streaming goldmine with unmatched ROE and high-margin business. The content library ensures cash flow for decades, and Q1 FY26 proves growth continues. But – and it’s a big but – the stock is expensive, and promoter selling raises eyebrows.
SWOT Quickie
- Strengths: Huge music library, high margins, zero debt.
- Weaknesses: Overvaluation, high dependence on licensing income.
- Opportunities: OTT and streaming boom, regional music growth.
- Threats: Copyright disputes, competitive pricing pressure.
Final Word: Great business, strong fundamentals, but stock is priced like a hit single on repeat – catchy, but you may get tired if you buy at the top.
Written by EduInvesting Team | 30 July 2025
SEO Tags: Tips Music Q1 FY26 Results, Tips Industries Share Analysis, Music Streaming Stocks India
