Saregama puts its e-biz plan on hold

KOLKATA: Saregama India Ltd., formerly Gramophone Company of India, has put a

hold on its future e-business plan and has decided to appoint McKinsey &

Company to chalk out a plan for its future growth.

At a press conference Saregama's managing director Abhik Mitra said McKinsey

& Co was appointed for strategic planning two weeks ago. McKinsey will look

into possibility of foraying into the field of television content, animation,

films and event management.

The McKinsey study would start in June and would be completed in about eight

to 10 weeks. The firm would take decision on expanding in September. The firm

has decided not to start a separate subsidiary called HamaraCD Inc. in San Jose

and has decided to merge its two portals HamaraCD.com and Saregama.com.

Mitra said that the e-biz operation would be maintained without using

exorbitant funds for advertising. The company has also shelved its plan for a

subsidiary on FM programming, Mitra said. Both the e-biz and the FM programming

business would be carried out as divisions of Saregama India, Mitra said.

The firm has reported a gross profit of Rs 16.71 crore on a turnover of Rs

177.04 crore for the year 2000-01, against Rs 7.28 crore gross profits on sales

of Rs 146.09 crore in 1999-2000. The net profits of the current year is at Rs

5.39 crore against Rs 6.56 crore.

The fall can be cited to the payment of Rs 9.57 crore made as part of the VRS

scheme in 2000-01. The company has also put on hold its plans for a foreign

listing until the Mckinsey report.