TIPS Music Hits The Right Notes: YES Securities Projects Rs1,050 Target Price

TIPS Music, a leading Indian music label, has been given a 'Buy' rating by YES Securities, which initiated coverage with a target price of ?1,050. This implies a potential upside of 18% from the current market price of ?888.65. Following the announcement, shares of TIPS Music rose by 1.7% on Tuesday to ?888.65 on the BSE.

YES Securities has valued TIPS Music at a Price-to-Earnings (P/E) ratio of 47 times its projected earnings per share (EPS) for September 2026. The brokerage highlighted strong industry tailwinds, such as the growing adoption of music streaming and digital platforms, as key drivers for the company's bullish outlook.

On Monday, TIPS Music announced a strategic partnership with TikTok to expand its reach among music fans, non-resident Indians (NRIs), and expatriates. This collaboration aims to enhance content engagement on TikTok’s global platform, opening up new monetization opportunities for the music label.

With a catalogue of over 31,000 songs and a YouTube channel boasting over 104 million subscribers, TIPS Music generates 85% of its revenue from its evergreen music collection. Its recent four-year global partnership with Warner Music, excluding YouTube, promises to boost its presence on digital platforms through a minimum guarantee and revenue-sharing model.

The Indian music industry is projected to grow at a compound annual growth rate (CAGR) of 15% through 2026, driven by increasing digital advertising, premium subscriptions, and the rising popularity of regional and independent music. YES Securities estimates TIPS Music's revenue to grow at a 38% CAGR between FY24 and FY27, supported by both digital and non-digital streams.

TIPS Music’s content acquisition strategy and focus on digital partnerships are expected to maintain high EBITDA margins and provide steady returns to shareholders through dividends and share buybacks, the brokerage added. With its robust business model and strategic collaborations, TIPS Music is well-positioned to capitalize on the evolving entertainment landscape.