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Media
ƒ Sequentially higher ad revenue growth on back of festive season
Media companies across the board are expected to post robust ad
revenue growth with the festive season shifting to Q3FY11. Our
media universe would grow 18.5% YoY and 7.1% QoQ. Regional
players would register higher ad revenue growth compared to
national peers. Print companies are expected to post 11-29% YoY
ad growth with Jagran Prakashan (up 29%), DB Corp (21%) and HT
Media (28%) while Deccan Chronicle is expected to post 11% YoY
growth. ENIL is also expected to see 15% YoY ad revenue growth
backed by higher utilisation rate. The consolidated topline would
decline as OOH revenue would be included only for two months.
ƒ Occupancy, footfalls fail to step up in seasonally good quarter
Multiplexes would register lower occupancy in a seasonally good
quarter due to lack of quality content in Q3FY11. Big budget movies
like No Problem, Tees Maar Khan and Khelein Hum Jee Jaan Sey
(KHJJS) failed to perform at the box office. Average occupancy is
expected to inch down by about 1-3% for all multiplexes. ATP is
expected to remain stable sequentially at about | 133-150.
ƒ Strongest ever subscriber addition by Dish TV
Dish TV reported highest ever net adds for November 2010 at 0.5
million. We expect the company to add about 1.1 million
subscribers in Q3FY11 on the back of attractive offers in the festive
season. However, this may lead to further decline in ARPU though
the management is confident of stabilising it at current levels. We
estimate the company will end Q3FY11 with 9.4 million subscribers
and blended ARPU of | 146, down from | 152 in the last quarter.
ƒ Profitability to show mixed trend
Margins would show a mixed trend with strong expansion for Dish
TV (huge subscriber jump led revenue growth), ENIL (festivity led
higher capacity utilisation and revenue linked royalty payment), Sun
TV (realisation of Endhiran in Q3FY11). Margins for Hindi print
companies would decline on the back of firm newsprint prices and
increasing competition in Jharkhand. DB Corp would have stable
margins due to one-off launch expense in Q2FY11. Multiplexes will
witness YoY contraction in margins due to lack of quality content.
PVR would also report losses from its home production KHJJS.
Cinemax The company rolled out two new properties with the addition of 1346 seats in
Malegoan and Vadodara. We expect both ATP and occupancy to remain stable
sequentially at | 138 and 24.5%, respectively
DB Corp The company launched its Jamshedpur edition towards the fag end of Q2FY11.
Intense competition continues in Jharkhand leading to increased circulation and
decline in cover price across companies. On the back of the festive season, DB Corp
would post 21% YoY ad growth, while margins would improve 42 bps
Deccan
Chronicle
The company would post ad revenue growth of 11.0%. However, on the back of
rising newsprint prices, EBITDA margins would decline 40 bps YoY. Our valuation for
it does not include the contribution from the sporting venture
Dish TV Dish TV added highest ever subscribers at 1.1 million in this quarter with the total
subscriber base reaching over 9.4 million on the back of attractive offers during the
festive season. However, we expect ARPU to decline marginally to Rs 173 while
new subscriber ARPU is expected to fall to | 138. Consequently blended ARPU
would fall ro | 146 from | 152 in last quarter.
ENIL We expect festivity led improvement in inventory utilisation. Top 10 stations would
have inventory utilisation of over 80% while that in the rest 22 would increase to
65%. Reduction in royalty fee would lead to an improvement of 464 bps in
standalone EBITDA margin but it would be set off by higher SG&A expenses
HT Media We expect English ad revenues to grow 18% YoY and Hindi ad revenues to grow
~35% YoY on the back of festive season. Revenues from radio segment are
expected at | 14.7 crore. EBITDA margins would dip 315 bps YoY partly on
increased competition in Jharkhand with launch of Dainik Bhaskar
Jagran
Prakashan
With price hikes partially absorbed and increase in ad volumes, advertisement
revenue is expected to grow at 29.0% YoY. EBITDA margins are expected to remain
stable on the back of stable newsprint prices
PVR PVR did not roll out any new property in this quarter. The company released Khelein
Hum Jee Jaan Sey in this quarter. However, the movie did not fare well at the box
office and the company is expected to book losses for the same in this quarter. Due
to lack of quality content, occupancy would dip to 30% from 33% in Q2FY11
Sun TV Sun TV would post robust 39% YoY revenue growth on the back of the festive
season led ad revenue growth of 15.4%, subscription revenue growth of 54% and
booking of revenue from the movie Endhiran. We expect the company to add 0.26
million viewers in its DTH segment in Q3FY11E
UTV Software UTV released Tees Maar Khan and Guzaarish during the quarter. While Guzaarish
had a decent performance, Tees Maar Khan fared badly at the box office. The launch
of new TV shows on regional channels would also boost the otherwise depleting TV
revenue
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