Leading optical disc manufacturer Moser Baer [Get Quote] is betting big on its new business ventures.

The company expects its optical media business -- which currently contributes almost 100 per cent of its revenues -- to  comprise only a third of its revenues three to five years down the line.

Its subsidiaries -- Moser Baer Home Entertainment and Moser Baer Photo Voltaic -- on the other hand, are expected to contribute a major chunk of its revenues by 2011-12.

"Our optical media business will grow at about 20-25 per cent CAGR and continue to provide us with comfortable amount of cash," said Ratul Puri, executive director, Moser Baer.

"Our business, including the photovoltaics venture, has the potential of becoming a billion-dollar activity. Consequently, the share of optical business in revenue will come down," he added.

Moser Baer has been facing a decline in profit over the past few quarters.

Explaining the reasons for the fall, Puri said "Our new businesses have not been consolidated in our books so far. We are planning to show them from the coming financial year. Currently, the company's results comprise mainly revenues and profits from optical media business that has been going through a slump."

Puri is, however, optimistic that the company's optical media business will see a turnaround this year.

"The industry needs a couple of triggers to stabilise, most importantly, the rise of Blu-ray. When the Blu-ray wave happens by the fourth quarter of next fiscal, we will be the market leader. Till then, we will get comfortable cash flow from this business, with earnings of $100-150 million."

Puri denied reports that PV business would be listed in the US. "Those reports are false. We have no such plans in the near future. Recently, the company raised $100 million from private equity route and will resort to similar measures in the  future," he asserted.

Meanwhile, over the past couple of years, the company has aggressively pursued a diversification strategy to counter the global slowdown in the optical media business.

Puri attributes this diversification to the availability of cash accruing from the optical media business and the management's wherewithal to handle this expansion.

"Our optical media business throws up a lot of free cash for investing in other businesses. Also, there was an increase in the management's bandwidth as we matured as an organisation," Puri said.

Moser Baer started diversification by foraying into the photovoltaic industry in 2005. It entered into the home entertainment space last year, with its low-cost movie VCDs and DVDs.

The company entered into consumer electronics though its IT peripherals business and ventured into movie production with its recent production of Shaurya.

"We are planning to expand our VCDs and DVDs business. The company will utilise its investment for the production of new movies this year," he said.