Broadcaster vs billionaire: the battle for control of India’s media

At a private dinner in 2007, a TV anchor was not about to let a politician go unchallenged. Prannoy Roy, a broadcaster and co-founder of media group New Delhi Television, confronted the then Gujarat chief minister Narendra Modi over rioting in the state five years earlier that led to the deaths of nearly 2,000 people.

Roy’s ambush set the tone for a combative future relationship with Modi, who was elected India’s prime minister in 2014. At the gathering with journalists, Modi stuck by his denials of any involvement in the riots, but left before food was served, according to investor and Financial Times contributor Ruchir Sharma’s book Democracy on the Road.

Now the media mogul is the one being cornered. Gautam Adani, a tycoon seen as close to Modi, launched a corporate raid on NDTV last week. Roy and his wife and co-founder Radhika Roy are now fighting Adani, the world’s third wealthiest man, for control of a media group that supporters say is a bastion of media independence.

Defeat for the Roys would leave India’s biggest television news channels controlled by billionaires, with what some analysts have argued would be profound implications for media plurality.

Mukesh Ambani, chair of Reliance Industries and India’s second-richest man, already controls the expansive Network18 media group and is building a new streaming service in collaboration with James Murdoch.

“Between Ambani and Adani, they will now control the two largest networks,” said Indrajit Gupta, former editor of Forbes India and co-founder of online platform Founding Fuel. “In a noisy democracy, you need to listen to a few different voices, but with this you lose diversity.”

Adani, like Modi, comes from Gujarat. The first-generation entrepreneur supported the then chief minister when he was criticised over his handling of the deadly 2002 riots and his rise since has tracked Modi’s. Adani has backed the prime minister’s vision for nation building and is now the dominant player in Indian infrastructure.

Adani has strongly denied any improper relationship to the prime minister.

The Roys themselves opened the way for their loss of control when they borrowed indirectly from Ambani’s Reliance Industries over a decade ago. That loan paid no interest, but came with warrants convertible to ownership of a company set up by the Roys that holds 29 per cent of NDTV’s stock — a time bomb that was contained inside a shell company bought by Adani late last month.

The Roys are giants of India’s raucous media, famous for producing the country’s first independent TV news show in 1988. Originally appearing on the state broadcaster, NDTV tied up with Rupert Murdoch’s Star network amid liberalisation of India’s economy in the 1990s. NDTV later launched channels for news in Hindi and English as well as for business and lifestyle content.

“There is an entire generation of Indian TV journalists who grew up under the NDTV umbrella and owe a huge debt to the Roys,” said Rajdeep Sardesai, a news anchor and editor with TV channel India Today, who spent 11 years at NDTV.

The company went public in 2004, though the Roys retained controlling stakes. NDTV was already facing fierce rivalry for advertising revenue when the global financial crisis struck in 2008. The Roys had been determined to buy back NDTV stock before the crisis hit, but needed to borrow to do so. Their resulting borrowing eventually led to the ill-fated loan from Ambani, according to a securities regulator tribunal.

Once considered by politicians the go-to station for appearances, NDTV’s testy relationship with Modi’s Bharatiya Janata party administration has hurt its bottom line.

Before the BJP came to power, NDTV in 2013 demonstrated its political connections with a 25th anniversary party in the presidential palace. But one Indian executive said the Roys were part of the old establishment. “The system has turned, and they have turned victim of the system,” the executive said.

Government agencies pulled advertising, while BJP spokespeople did not participate in its programmes. Authorities including the Income Tax Department and Central Bureau of Investigation brought cases against NDTV and the Roys. One such probe prevented them travelling abroad in August 2019. The Roys have always denied wrongdoing.

Still, NDTV’s finances have been improving. Revenue from operations for the financial year ending this March was Rs2.3bn ($29mn), up from Rs2bn the previous year, while annual profits surged to Rs600mn from Rs380mn. NDTV also brought down borrowings from Rs632mn to Rs178mn.

RRPR, the company owned by the Roys that holds the 29 per cent stake, has refused to transfer the shares to an Adani Group subsidiary without approval from the securities regulator.

But analysts said the Roys would struggle to fend off the deep-pocketed Adani, who has offered to buy a further 26 per cent of NDTV’s shares from shareholders. NDTV’s biggest public shareholder, with a nearly 10 per cent stake, is a little-known Mauritius-registered entity, LTS Investment Fund, whose portfolio is 98 per cent invested in Adani Group companies. NDTV’s share price began climbing this spring on deal speculation.

Some observers have predicted that a successful takeover by Adani’s media arm would lead to the watering down of NDTV’s editorial independence. The Adani Group did not respond to a request for comment.

Sanjay Pugalia, chief executive of the group’s AMG Media Networks, said the company sought to “empower Indian citizens, consumers and those interested in India, with information and knowledge”.

Meenakshi Ganguly, south Asia director with Human Rights Watch, said Modi’s government had few remaining critics such as NDTV. “This is an administration that largely enjoys a loyal media — whether by choice or fear,” she said.

India’s information and broadcasting ministry did not respond to a request for comment.