Tips Music sees room to beat 20% revenue, profit growth guidance for FY27

Mumbai-based music label and film production company Tips Music expects to maintain revenue and profit growth of 20% each in FY27, with a possibility of exceeding the guidance by 2-3%, as its music catalogue, new releases and digital platforms support business growth.

Kumar Taurani, Chairman and Managing Director of Tips Industries, said the company remained confident of meeting its annual targets despite fluctuations in quarterly performance due to the timing of film releases.

The company had planned to release a Tips Films production in the fourth quarter of the previous financial year, but the release was shifted to the first quarter of FY27. Such changes can affect quarterly performance without necessarily altering the full-year outlook.

July-September quarter (Q2FY27), Tips Music reported revenue of ₹120 crore, net profit of ₹65.7 crore and margins at 70.48%.

The stock was trading at ₹680.00 at 3:03 pm on the NSE and has gained more than 35% over the past year.

Tips Music plans to allocate around 20-22% of its revenue towards content investment during the year. The company expects this spending to support its music catalogue and film pipeline while keeping investments within its planned budget.

Tips Music expects its existing music catalogue and fresh releases to remain key growth drivers in the coming quarters. The company is also confident of sustaining growth in the second half of FY27, supported by its release pipeline and the seasonal increase in music consumption during festivals and the holiday period.

Navratri, Dussehra, Diwali, Christmas and New Year typically provide opportunities for music labels as demand for music rises during celebrations and social gatherings.

Digital platforms continue to play an important role in Tips Music's business. Taurani identified YouTube, Spotify and Instagram among its key platforms, while public performance revenues and music publishing are also contributing to growth.

The company generates revenue through a combination of direct business and partnerships. Its publishing arrangement with Sony Music Publishing for international repertoire contributes around 5-6% of the top line, according to Taurani.

Its sound recording partnership with Warner for OTT platforms contributes a further 25-30% of the business, while the remaining revenue comes through direct operations.

Tips Music is negotiating with YouTube over the renewal of its YouTube Shorts commercial arrangement. Taurani said discussions were ongoing and the company hoped to finalise an agreement during the current quarter.

He noted that contract renewals and negotiations over commercial terms remain a challenge for music labels. The outcome of these discussions will be an important factor to watch as the company looks to sustain growth in the coming quarters.

Despite the ongoing negotiations, Taurani remained confident of achieving the company's content investment plans and FY27 targets.

Tips' Music current market capitalisation is ₹8,691.27 crore.

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