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"THE INDIAN ECONOMY IS GOING THROUGH AN EXCITING PHASE OF DEVELOPMENT. AS PART OF A 90-YEAR OLD GROUP, WITH PRESENCE IN DIVERSE INDUSTRIES, IT IS HEARTENING TO SEE REFORMS BEING IMPLEMENTED AT AN EXHILARATING PACE ACROSS MULTIPLE SECTORS. SEVERAL AREAS WHICH GOT NEGLECTED FOR LONG ARE SEEING CONSTRUCTIVE WORK, ALONGSIDE A PLETHORA OF MEASURES TARGETED AT IMPROVING EFFICIENCY. INDIA'S ECONOMIC GROWTH, WHICH IS ONE OF THE FASTEST, SHOULD ACCELERATE FURTHER AS THESE INITIATIVES YIELD POSITIVE RESULTS."
The year gone by will be remembered for the strong and decisive push towards formalising the economy. As per estimates, the informal sector in India accounts for approximately 50% of the GDP, is less efficient, difficult to regulate and leads to revenue loss for the exchequer. Easy access to banking coupled with the thrust on digital payments enables the migration of informal sector to formal sector. The imminent implementation of GST will simplify the taxation regime and create a level playing field by plugging tax leakages in the informal sector. Demonetisation, perhaps the most courageous decision, is a long-term positive for the economic growth despite the short-term difficulties. These trends, along with increasing spends by households on discretionary items, open up interesting and exponential opportunities for the Indian Media and Entertainment (M&E) industry and ZEEL. India's per capita entertainment consumption is far less, both in terms of time and money, compared to its peers as well as developed countries. This presents a significant growth potential for the M&E industry. It is estimated that the industry will grow around 14% CAGR over the next five years.
From the advent of satellite television, a quarter century ago, the industry has evolved significantly and ZEEL has played a pivotal role in this transformation. Today, we stand at the cusp of another generational shift in the way entertainment is consumed, and I am glad to share that we continue to be at the forefront of shaping that change. We have invested in becoming a provider of superior entertainment content across genres, languages, and geographies; reaching consumers through television, digital, movies, music and live entertainment.
In the entertainment industry, the more things change, the more they remain the same. While viewing preferences may evolve or new platforms for content consumption may emerge, content itself remains the fulcrum on which viewers' interest rests. Today, viewers have more choices, limited attention spans and access through multiple platforms. However, the need for creating sharp and engaging content is timeless. ZEEL sees its primary role as a creator, aggregator and disseminator of quality content that resonates across demographics and geographies. Our experience and focus on understanding viewers' preferences has allowed us to grow ahead of the industry. A testimony to this fact is that our revenues and EBITDA have grown by 16% and 21% CAGR respectively over the last five years.
During FY17, the performance of our five businesses was encouraging. The television business strengthened its position in a competitive environment. Our movie production and music label businesses scaled up operations which aided the growth. In the international business, our foray into new markets was received positively. Content consumption on both our OTT platforms, OZEE and dittoTV, saw significant growth. Live Events business kick started its operations with the roll-out of its first property. During the year, we divested our sports business to Sony Pictures Network and started the process of acquiring the broadcasting business of Reliance Broadcasting Network. Despite the impact of demonetisation, our revenues grew by 11% and EBITDA grew by 27%.
Looking ahead, we remain excited about the growth opportunities for the industry and the Company. As digitisation of analogue subscribers is nearing completion, it will improve monetisation of our viewership in newly digitised areas. This coupled with effective implementation of TRAI's tariff order could lead to acceleration in ARPU growth for the industry, which has been lagging for several years. Strong economic growth and increasing share of formal sector bodes well for ad spends growth. Our new businesses are also scaling up well and have a strong growth potential which will contribute to our growth.
As we continue to focus on sustainable profitable growth, we are increasingly conscious of our responsibility towards social causes and environment. Education has been one of our focus areas during the year. Our Army behind the Army initiative recognises and applauds the mothers, wives, daughters and sisters of our brave soldiers who are the true source of their strength. In addition, by leveraging our content leadership and reach, we have extended our philosophy of community engagement and "Vasudhaiva Kutumbakam" (The World Is My Family). We endeavour to not just entertain our viewers but also inform, educate and engage them through our content. For instance, through one of our fiction shows on Zee Kannada, we designed an entire campaign to spread awareness about female foeticide. We are empowering women through skill development initiatives and health education among others in different cities in Maharashtra through Jagruti events organised by Zee Marathi. Lastly, we also ensure that our operations reduce their carbon footprint. The 'Zee is Green' initiative ensures that our sets, offices and the ecosystem follows responsible practices. We have set a target for ourselves to become carbon neutral by 2020.
The team at ZEEL and all our stakeholders are working very hard to strengthen our value proposition of 'A to Zee' of content leadership. I thank all of you for your constant support and encouragement. I am confident that this will continue as we move into an exciting phase of our journey.Yours truly,