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UBS Investment Research
Sun TV Limited
Strong revenue growth led by movie ‘Enthiran’
EBITDA and net profit ahead of UBS and street estimates
Sun TV reported 3QFY11 standalone results: Revenue grew 51% yoy to Rs5,980m
(UBS-e Rs5,699m). EBITDA grew 61% yoy to Rs5,018m, 10% ahead of UBS-e of
Rs4,559m; EBITDA margin expanded 480 bps yoy to 83.9% (UBS-e 80.0%). Net
profit grew 48% yoy to Rs2,255m ahead of UBS-e at Rs2,056m and consensus
estimate of Rs2,085m.
Enthiran led to strong revenue growth
Sun TV earned revenues of Rs1.79bn (including satellite revenues of Rs150m)
from the release of its blockbuster movie ‘Enthiran’. Of this, Rs1.51bn was
reported as revenue in 3QFY11. Excluding the revenue from Enthiran release,
revenues grew 13.1% yoy to Rs4.47bn. The total production cost for this movie
was Rs1.32bn, of which Rs1.07bn has been recorded as amortisation in 3QFY11.
Sun TV management is hosting conference call on 31 Jan 2011
Sun TV management is hosting a conference call on 31st Jan 2011 at 10am India
time to discuss 3Q FY11 results (please refer to table 2 for dial in details). We
intend to review our forecasts following the call.
Valuation: Sell rating with DCF based price target of Rs500
We derive our price target from a DCF-based methodology and explicitly forecast
long-term valuation drivers using UBS’s VCAM tool.
Sun TV Limited
Sun TV Network Ltd (Sun) is the largest TV broadcaster in south India and has
channels catering for the four regional languages: Tamil; Telegu; Kannada; and
Malayalam. Kalanithi Maran is the majority shareholder with a 77% stake. Sun
and its two subsidiaries have radio licences in 44 cities.
Statement of Risk
We believe the company faces regulatory risks and competitive risks in its core
business of broadcasting
India Equity Research Reports, IPO and Stock News Visit http://indiaer.blogspot.com/ for complete details �� ��
UBS Investment Research
Sun TV Limited
Strong revenue growth led by movie ‘Enthiran’
EBITDA and net profit ahead of UBS and street estimates
Sun TV reported 3QFY11 standalone results: Revenue grew 51% yoy to Rs5,980m
(UBS-e Rs5,699m). EBITDA grew 61% yoy to Rs5,018m, 10% ahead of UBS-e of
Rs4,559m; EBITDA margin expanded 480 bps yoy to 83.9% (UBS-e 80.0%). Net
profit grew 48% yoy to Rs2,255m ahead of UBS-e at Rs2,056m and consensus
estimate of Rs2,085m.
Enthiran led to strong revenue growth
Sun TV earned revenues of Rs1.79bn (including satellite revenues of Rs150m)
from the release of its blockbuster movie ‘Enthiran’. Of this, Rs1.51bn was
reported as revenue in 3QFY11. Excluding the revenue from Enthiran release,
revenues grew 13.1% yoy to Rs4.47bn. The total production cost for this movie
was Rs1.32bn, of which Rs1.07bn has been recorded as amortisation in 3QFY11.
Sun TV management is hosting conference call on 31 Jan 2011
Sun TV management is hosting a conference call on 31st Jan 2011 at 10am India
time to discuss 3Q FY11 results (please refer to table 2 for dial in details). We
intend to review our forecasts following the call.
Valuation: Sell rating with DCF based price target of Rs500
We derive our price target from a DCF-based methodology and explicitly forecast
long-term valuation drivers using UBS’s VCAM tool.
Sun TV Limited
Sun TV Network Ltd (Sun) is the largest TV broadcaster in south India and has
channels catering for the four regional languages: Tamil; Telegu; Kannada; and
Malayalam. Kalanithi Maran is the majority shareholder with a 77% stake. Sun
and its two subsidiaries have radio licences in 44 cities.
Statement of Risk
We believe the company faces regulatory risks and competitive risks in its core
business of broadcasting
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