Publishing: The man who busted major myths

Sixty-five-year-old Ramesh Chandra Agarwal is an unlikely rabble-rouser. The chairman of the Rs 960 crore (Rs 9.60 billion) DB Corporation is polite, speaks impeccable Hindi, remembers when he last met you and never once tries to hurry up the interview even with several phones ringing in the background.

Yet this mild-mannered man committed the first blasphemy in the Indian publishing business. He has, since, continued to make moves that challenge every norm and myth in the business. In 1996, when publishers hung onto their states, regions or languages, and when it was considered rude to expand or even have ambition, he stepped out of his home state Madhya Pradesh into Rajasthan with his Hindi newspaper, Dainik Bhaskar. Worse still, he succeeded.

He then went into other states and finally committed a bigger sin-- launched a paper in another language. In 2003, DB Corp (then Dainik Bhaskar Group) launched Divya Bhaskar, a Gujarati language newspaper. Divya Bhaskar expanded the market by over 30 per cent and became a case study at the Indian Institute of Management, Ahmedabad.

By the time he went into Mumbai in 2005 with DNA (English) in a separate joint venture with Subhash Chandra's Essel Group, the jeers were subdued. Mumbai, a Times of India stronghold, was a tough market that neither the Ambanis with The Business and Political Observer nor the Singhanias with The Indian Post had cracked. What chance did this minnow from Bhopal, then one-fifth the size of The Times Group, have? A good one it seems. Just months after the Mumbai launch, in 2006, Warburg Pincus picked up a 7 per cent stake in Dainik Bhaskar for Rs 150 crore.

The man who decided in 1980 to make the struggling family newspaper financially independent has certainly come a long way. Today DB Corp publishes seven newspapers with 48 editions and 128 sub-editions. It has interests in radio, outdoor and other media. Bhaskar and rival Dainik Jagran, among others, have proved the propelling power of small-town India with its huge consumer base. Their collective effort has narrowed the advertising rate gap between English and language brands. Language newspapers have finally earned the respect that their large numbers deserve. Ten years back it was unthinkable that a language newspaper company could become a national media player. Now several are on their way.

This week Agarwal bust another myth-- that on print valuations. DB Corporation has just wrapped up its primary issue which was subscribed almost 40 times. Assuming it lists at more than the price of the initial public offer, the valuation of the company could range between Rs 4,000 and Rs 5,000 crore, against the Rs 3,000-3,500 crore for most listed print players.

Where will the growth, which will justify this valuation, come from? "There are so many states in India, there is the overseas market," says Agarwal. There could be merger or acquisition opportunities in languages where Bhaskar doesn't yet have a presence. In the shrinking overseas market, "we could be content providers in other countries. We are also working on a real-time newspaper. Unlike print, the net is not limited-- you can play with the text, visuals. If the newspaper is dying, media companies simply have to change its form".

Is Agarwal and his largely family-run company up to the questioning that going public involves? "Warburg invested in us almost five years back, so we are used to having investors on board," he counters.

His one big dream post-IPO? "Bhaskar (group) should be professional, like the Tatas, and aggressive, like the Ambanis." Await more blasphemies, then.