Brand Licensing Strategies in India’s 2025 Entertainment Sector Amid SEBI’s IP Disclosure Reforms

Introduction: Navigating Growth and Governance in a Dynamic Landscape

The Indian entertainment industry, which includes the dominance of cinema in Bollywood and the furious growth of the models of over-the-top (OTT) services, is a fundamental element of economic and cultural development in 2025. Web 3.45 lakh crore with an approximate growth rate of 8.3% in the coming 2028, the industry is no longer reliant on theatrical distribution, but it is rather based on ecosystems and licensing as the primary source of revenue, which are expected to be generated through syndication, merchandise, and global distribution.

This change of gearing with local content and joint production by other global regions has made intellectual property (IP) an important economic resource. But with the entertainment sector represented by listed companies, including the production giants such as Yash Raj Films and the leaders of the OTTs such as Netflix India, there are more stringent disclosure norms in place. In the proposed amendments to the Listing Obligations and Disclosure Requirements (LODR) Regulations, 2015, which substantially changed the requirements for detailed reporting of IP assets provide new guidelines concerning the monthly reporting of IP assets the Securities and Exchange Board of India (SEBI) introduced in August 2025 (which on the one hand confirm the relevance of this study).

Including the norms that have been finalized on September 8, 2025, these norms would require media companies to treat IP as an intangible value, not only but a quantifiable balance sheet split. The changes come with a fifteen% increase of cross-border entertainment value over USD 2 billion in the first half of 2025. Although necessary measures in making the company transparent in order to regain confidence of investors, these rules also re-establish risk assessment and brand licensing policies.

The August 2025 SEBI rules: A Framework of IP Transparency

SEBI released its IP disclosure framework on August 4, 2025, following more than four years of consultation with more than 50 stakeholders in the industry, where IP assets sometimes take 60-70% of the overall value. The revised Regulation 34(3) of LODR, in turn, requires listed companies to provide detailed IP disclosures at annual reports, including the copyrights, trademarks, and licensing agreements, fair value assessment as per the Ind AS 38, details of any pending litigation, and amount of revenue streams expected to come out of rights exploitation. This operates on preceding reforms, including the 2025 ICDR renovations, though it targets specifically IP-based entertainment organizations. Companies should also give quarter report on material licensing transactions with a value exceeding 5% of the total revenue.

The application includes third-party values where independent third parties are often required to perform using discounted cash flows models that are balanced to see the number of viewership or the hours of streaming to ensure that the valuations are based on current aspects in the market. The reason behind this rigor is clear: prior to 2025, any valuation discrepancies were reported through pre-2025 audits when one of the biggest studios inflated its licensing revenue by 25% when the records of the chain-of-title were not complete, resulting into a drop in market valuation by 12%.

The reforms made by SEBI also brought Indian standards to IFRS 13 that has enhanced investor confidence since foreign portfolio investment in the entertainment sector increased by 40% points annually. This has seen IP due diligence become a prerequisite to licensing, which has formalised negotiations as an audit so that this is a vital requirement before the next phase of further development of the licensing process.

Reshaping Licensing for Bollywood and OTT Brands: From Opacity to Accountability

The guideline set by SEBI has redefined the launch of the brand in licensing of the Bollywood franchises and libraries of OTT content, and the approach towards the deals has changed to value spearheaded agreements. Prior to the reforms, licensing deals, e.g. 2024 syndication of Paatal Lok by Zee Entertainment, tended to have broad terms and little IP checkpoints, and result in territory disputes. Encumbrances are to be disclosed by licensors after the year 2025 in August. As an example, the September renewal of Dharma Productions with Amazon Prime Video was postponed in 45 days based on required audits but still received a 20% increase in exclusivity fees as confirmed through financial forecasts.

In real practice licensing contracts are now based on standard forms, with the SEBI-mandated annexures monitoring IP through to monetization. This allows the use of integrated valuation data by licensees like Disney+ Hotstar to assess risk. The 2-fold goal is evident: in the case of Bollywood, where film merchandising operations such as Animal have resulted in INR 500 crore, can reveal it would decrease the risk of over-licensing; with OTTs the 25% growth in subscribers to 500 million, it would allow deal through bundle packages of ad-tech. There is an increased access to capital, though compliance adds to the cost of mid-tier studios (8-10%), since debt financing of IP-backed projects increased by 15% after the reform.

Analytical Comparison: Cross-border dealings Pre-and-post-reform risks

The reforms have essentially changed the nature of cross-border licensing such that the pre 2025 opacities have been shifted towards structures of accountability. Previously, foreign licensees as in the case of Warner Bros. in the 2024 RRR co-licensing process were subject to incomplete views of chain-of-title, which resulted in a high number of arbitrations over moral rights under the Berne Convention. Valuation gaps had also never been eradicated; without the compliance with the Ind AS, IP assets were being under-valued by up to 25%, raising a double taxation cross-border under OECD standards, and that contaminated deal failure as in the case of the Sony-Viacom18 merger caused by undisclosed IP liabilities of INR 300 crore. Currency variations and geopolitical forces were also the pivots of revenue volatility up to 15% in 2024. With the reforms gone, the risks are now internal and manageable.

According to FICCI-EY reports, the 10% quarterly IP materiality level required by SEBI helps to predict modeling and has, on pilot reports, lowered arbitration rates by 40. An example is that in October 2025 Netflix renewed the rights of Sacred Games with Phantom Films via blockchain-verified records, eliminating any chance of transfer pricing by signing tax agreements up front. The transparency of data will enable Indian licensors to charge 12.15% higher rates in negotiations in the EU where residual valuation has become the work of Monte Carlo simulation. However, these advantages do not come free.

The compliance processes not only worsen the deal cycles (by 20-30 days) but also increase the cybersecurity risks (18% of all breaches in 2025 attacked IP databases, as reported by KPMG). However, the study of 50 international agreements by PwC in 2025 observed that transaction risk had reduced by on average 35% and investor sentiment had also improved by half. Although smaller studios will lose agility, the bigger picture is to have a better, more credible market base.

Opportunities for Niche Collaborations in Regional Content

SEBI’s reforms have also revitalized regional content licensing, which now accounts for 40% of OTT viewership and grows at 12% annually. Earlier, Tamil, Telugu, or Bengali IPs were restricted to domestic syndications with 22% higher infringement risks due to poor disclosure. Post-reform, SEBI’s IP registries-including geo-tagged cultural mappings—facilitate verified licensing. A key example is the September 2025 collaboration between Aha Telugu and BBC Studios for Kannappa derivatives, consolidating 15 regional copyrights into a USD 10 million package.

Standardized valuation templates have enabled fairer revenue sharing, where regional creators retain up to 60% of downstream royalties through smart contracts, cutting administrative losses from 18% to 5%. For OTTs, these disclosures highlight synergies, such as JioCinema’s integration of Marathi podcasts with global partners, achieving 25% audience crossovers. Previously undervalued at 15–20% of Bollywood’s IP benchmarks, regional licensing volumes rose 28% after August 2025, according to License India Expo data.

These collaborations also balance market saturation: in 2024, 70% of Bollywood deals faced diminishing returns, while regional co-branded projects—like the Sun NXT–MX Player IP swap—increased EBITDA by 16%. Econometric data shows disclosure-compliant agreements achieve 35% higher longevity, reflecting reduced moral hazard and improved residual tracking. Under ASEAN–India trade frameworks, verified Tamil and Malayalam IPs have gained cross-border traction, with licensing to Thai platforms rising 40%. Though 12% of smaller regional firms report valuation skill gaps, SEBI’s subsidized toolkits may close this gap, potentially raising niche content revenues to 25% of industry totals by 2027.

Conclusion: Harmonizing Regulation with Creative Ambition

SEBI’s August 2025 IP disclosure reforms mark a pivotal shift for India’s entertainment licensing landscape, mitigating valuation risks, enhancing cross-border credibility, and empowering regional creators. As Bollywood and OTT entities adapt to these transparency-driven norms, the challenge lies in balancing governance with creative ambition, ensuring India’s entertainment economy grows not just in scale but in fairness and resilience.

Author: Amrita Pradhan, in case of any queries please contact/write back to us via email to [email protected] or at IIPRD. 

References

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