India operations are driving the revenues and profits of Rupert Murdoch’s STAR group, News Corp’s fully-owned Asia media subsidiary, according to the latest report by the Hong Kong-based Media Partners Asia (MPA).

In Q2 ending December, 2005, STAR India registered a 30% growth in advertising revenue to $142 million. Operating profit (earnings before interest and tax), however, grew even faster at 43% to $42 million. “STAR still maintains a significant lead in the market and grew earnings by 43% YoY in Asia (led by India) during its Dec. 2005 quarter with ad growth of 30% versus 7% for existing Zee channels,” the MPA report said.

According to industry sources, the Indian cable and satellite market generates advertising revenue worth Rs 6,000 crore. STAR India commands an estimated 15-17% share of this pie. This year, with the success of STAR’s KBC-II, this share is expected to go up, sources said.

For the first half of fiscal ending June, 2006, STAR group had revenues of $272 million, up 25% over H1, 2005. Operating margins for the first half, however, contracted from 24% to 21% as operating profit grew only 12% from $51 million to $57 million on account of higher programming and distribution costs, particularly in India, according to the report.

Commenting on the India earnings, the MPA report added: “Advertising and subscription revenue growth, mainly from India, boosted STAR earnings. Advertising gains were led by weekend programming initiatives at flagship Hindi general entertainment channel STAR Plus in India, and from growth at new general entertainment channel STAR One.”

(www.financialexpress.com)