Who owns your media? A look at Hindustan Times

In August 2005, when stock markets in India were booming, Shobhana Bhartia raised around Rs 400 crore by selling shares of HT Media, a company she had floated for her media house’s Mumbai operations. She managed to sell it at a huge premium — Rs 530 per share. The initial public offer was timed to encash the frenzy the Hindustan Times had whipped up with its high-decibel launch in Mumbai a month earlier, on July 14.

Bhartia’s biggest achievement was to bring a London-based private equity fund, Henderson Global Investor, onboard HT Media in September 2003, in one of India's first major foreign investments in the media. HGI sold five percent in IPO in 2005 for a killing, and sold the remaining stake in subsequent years, finally exiting completely in 2013.

The IPO, though priced at the upper end of the price range, was a massive success at the time, oversubscribed by eight times the offering.

Bhartia made two promises at the IPO. One, to launch a business newspaper. Two, start English editions in high-growth markets in South India. Like every other business owner, she also assured the investors that they could definitely look forward to profitable returns.

Her first promise was fulfilled on February 1, 2007, when Mint was launched to rival the Economic Times. The other promise, however, vanished into thin air as most South Indian markets for English newspapers remained fragmented with high-pitched competition.

Over the next decade, the KK Birla scion had to fight many challenges, in the newsroom and outside. As the company struggled to grow, its stock price crashed to Rs 10 per share, with a slew of rejigs and the overall economic slide to blame.

Early this year, Bhartia knew the print industry was facing heavy headwinds in a slowing economy. The chairperson and editorial director of the two listed media companies — HT Media Ltd and Hindustan Media Ventures Ltd — said in a statement on January 22 that a weakness in demand had made advertisers cautious with spends, hurting the revenues of both her print and radio businesses.

"We are hopeful of a revival in the next financial year but will remain focused on cost and efficiency measures which should hold us in good stead in the interim,” she said at the time.

The Covid pandemic botched her plans of a quick revival. She has now resorted to a major cost-cutting exercise, which will push at least a fourth of the Hindustan Times staff off the rolls. As a former HT employee pointed out, it’s routine for the HT management to bring in consultants such as McKinsey and the Boston Consulting Group to slash the manpower whenever they see storm clouds gathering over the horizon.

The newspaper industry, Bhartia’s mainstay of business, has seen an unprecedented slide during the coronavirus pandemic. In fact, the slide began well before, in early 2019. The latest Indian Readership Survey for 2019 recorded a 28 percent decline in average issue readership of Hindustan, the third largest newspaper in India, from 1.84 crore to 1.32 crore from the first quarter to the fourth quarter of 2019. In Delhi, the prime market for the Hindustan Times, readership has fallen 36 percent to 7.73 lakh, a shade above the figure for its arch rival, the Times of India, which also witnessed a fall of 21 percent in 2019.

The pandemic, which started to spread across India in March, has now blanked out HT's cash flows. The company was quick to respond with a cut in take home salaries by March-end. In an email to the staff, Praveen Someshwar, CEO of HT Media, which owns the Hindustan Times, mentioned that the daily was losing Rs 3.5 crore a day as it continued to incur costs but generated no revenue.

The other listed company in the group, the 102-year-old Hindustan Media Ventures Ltd, formerly The Behar Journals Ltd, was initially involved in the manufacture of paper and paper products, including newsprint. It went public on July 21, 2010, at the IPO price of Rs 166.

The group's Hindi newspaper, Hindustan, and a couple of Hindi magazines are under HMVL. Like the other listed company, the HMVL has also seen investors' returns dwindle over years. The stock is hovering around Rs 40 now.

As per stock exchange listing, both HT Media and HMVL are majority held by Bhartia and her family. Around 69.5 percent of HT Media is owned by The Hindustan Times Ltd, a Delhi RoC registered company, while HT Media in turn owns 74.30 percent in HMVL. Bhartia owns nearly three-fourths of The Hindustan Times Ltd.

On HT Media board, Bhartia serves as chairperson and editorial director while her son Priyavrat Bhartia, 43, is a director. On the HMVL board, Bhartia is chairperson and her son Shamit Bhartia, 41, is managing director. Priyavrat is also a director on the HMVL board, but Shamit Bhartia resigned from HT Media board in December 2019.

In the last two decades, the organisation has frequently been in a flux, especially when editors, such as Raju Narisetti and Bobby Ghosh, or CEOs have left. Ghosh joined in July 2016 and left in 14 months, soon after his pet project, Hate Tracker, which religiously tracked all communal and caste crimes in the country, became a political hot potato. Hate Tracker and Let’s Talk About Troll went into the details of several high-profile cases like the Dadri lynching and looked like an attack on the Narendra Modi government. Soon after Sukumar Ranganathan, the new editor-in-chief, came on board in September 2017, the entire project and the portal were dumped.

Bhartia’s Butterfly Project, an effort to focus on digital news and reduce the duplication of reporters or photographers attending the same press conferences and functions, was regarded as an excellent cost-cutting measure. But it soon went to the extreme; the entire HT business section was replaced with Mint content in 2017, rendering the HT business bureau staff jobless overnight.

Insiders told Newslaundry that Bhartia keeps a close watch on what goes into the next day's front page. Senior editors keep passing on to their bureau members important messages from Bhartia like "SB liked your piece" to ensure that reporters and the copy editors look for stories that please the bosses.

As a Rajya Sabha member from 2006 to 2012, Bhartia routinely took the help of domain experts from HT and Mint to raise issues in the august house. She is credited with introducing the Child Marriage Abolition and Miscellaneous Provisions Bill of 2006, replacing the Child Marriage Restraint Act, 1929. In 2007, it became the law.

Four years short of celebrating its centenary, the Hindustan Times, launched as an eveninger in Delhi on September 24, 1924, is probably facing the biggest threat to its survival today. For Bhartia, who joined the director's board in 1986, aged 29, it's nothing less than a trial by fire.

By Meghnad S and Anusuya Som.

Design by Shambhavi Thakur and Anubhooti Gupta.

With inputs from Pradipta Barik, Abhyudaya Tyagi, Upasana R, Abhineet Nayyar, and Ayushi Mishra.

This story is a part of the NL Sena project, which over 75 of our readers contributed to. It was made possible thanks to Gaurav Ketkar, Pradeep Dantuluri, Shipra Mehandru, Yash Sinha, Sonali Singh, Prayash Mohapatra, Naveen Kumar Prabhakar, Abhishek Singh, Sandeep Kelvadi, Aishwarya Mahesh, Tushar Mathew, Satish Pagare, and other NL Sena members. Contribute to our next NL Sena project, The Economics of post-Covid India by Vivek Kaul, and help to keep news free and independent.

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