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HT Media
HT Media declared its 3QFY2011 results. On a consolidated basis, the company reported
robust top-line growth of 29% yoy to `464cr (`359.4cr), aided by significant advertisement
revenue across all its publications. Recurring earnings grew by robust 36.1% yoy, aided by a
decrease in interest expense and tax rate. At the operating level, HT Media posted a modest 14bp
yoy expansion in operating margins, driving 28% yoy growth in operating profit to `86.7cr, aided
by various cross-rationalisation methods adopted by the company, which saw a decline in staff
cost (down 88bp yoy), advertising spends (down 199bp yoy) and other expenses (down 99bp
yoy); however, a significant 400bp yoy gross margin contraction on account of hardening
newsprint cost curtailed further OPM expansion. Sequentially, gross margins expanded by 669bp,
resulting in operating margin expansion of 374bp, despite an increase in all other operational
costs of the company. We will be re-visiting our numbers post the conference call with the
management today. Currently, the stock is under review.
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