Please Share:: 
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Sports to hobble ad revenues
With the festive season coming to an end, and sports
grabbing eyeballs in this quarter, revenues for media
companies are expected to drop in the quarter
sequentially by 10.6%. However, we expect them to
grow on a YoY basis by 20.5%. With ad revenue under
pressure and margins declining we believe the PAT will
grow by 15% YoY basis but de-grow by 21% QoQ.
Expect positive surprises from ZEEL, Dish TV and Info
Edge.
Increased ad spend to boost revenues: The absence
of a festive season and a sports heavy calendar is
expected to drive away ad revenues from media
companies under coverage. We estimate Sun TV to post
the lowest ad revenue growth of 14% while ZEEL, HT
Media and Jagran are expected to post ad growth of
18-21%. Print is expected to fare better with a 2% drop
in revenues (QoQ) while broadcasting is estimated to
witness a drop of 5% in revenues.
DTH revenues to boost broadcasting space:
Continuing the momentum of subscriber additions, we
expected DTH revenues to increase in this quarter due
to significant addition to DTH subscriber base in this
sports heavy period. Renewal of contract for Sun TV is
expected during the quarter.
Margins expand: Margins for the industry are expected
to shrink by 272 bps YoY and 493 bps sequentially on
the back of increased newsprint prices and high
programming cost coupled with lower ad growth.
Profits show steady growth: Profits are expected to
show a steady growth in the quarter by 15.4% on a YoY
basis. Sequentially, PAT is expected to go down by
23.2%. Print is expected to outperform the
broadcasting space by growing at 50% compared to
4.1% for the broadcasting space.
Overweight on the sector: We remain overweight on
the sector and have a BUY rating on Sun TV, Jagran
Prakashan, ENIL and Dish TV. We have a HOLD on Info
Edge, ZEEL and HT Media and Balaji Telefilms.
Balaji (Rating: Hold ;Target Price: Rs 38)
With no new launches in the commissioned category apart from regional programmes, we
expect revenue to be muted with a dip of 2.8% sequentially.
Operating margins are also expected to suffer, going down by 75bps sequentially with EBIDTA
loss at Rs1.8mn.
PAT growth is expected to slow down by 64.5% during the quarter due to the cancellation of
shows that were operational in the last year and lower other income.
Dish TV (Rating: BUY ;Target Price: Rs 81)
We expect 0.8mn subscriber additions due to the ongoing cricket season and hence we expectDish TV to post handsome gains on the revenue front at Rs 4426mn up 42.8% from Q4FY10 and
up 16% sequentially.
Margin expansion is expected due to fixed content cost. We believe margin will expand to
17.5% up by 602bps from Q4FY10.
It is expected to show PAT loss of Rs413mn down from Rs602mn in Q4FY10
ENIL (Standalone) (Rating: BUY ;Target Price: Rs 295)
Ad rate hike in August is expected to boost revenues of the company by 22%. However, weexpect revenues to decrease on a sequential basis post the festive season.
Low royalty payment structure implemented through the quarter should boost the margins by
979bps in the quarter from 24.2% in Q4FY10 to 364% in Q4FY11.
Profitability is also expected to see a jump of 214.6% from Rs 48mn to Rs 150mn
HT Media (Rating: HOLD; Target Price: Rs 166)
Revenue growth for the quarter is projected at 18.6% YoY for the quarter due to strong growthin advertising at 21% for the quarter. We believe circulation revenues will decline by 7% QoQ
due to the recent price cuts and lower circulation on back of holiday season in schools.
We believe that the operating projects will drop by 668bps in the quarter due to higher raw
material prices.
We expect PAT to shrink by 11.6% YoY to Rs438mn due to lower operating margins.
Info Edge (Rating: HOLD; Target Price: Rs 553)
We expect 26.1% YoY increase and a strong 10.3% sequential increase in sales on the back ofstrong demand from the recruitment vertical.
We expect margins to remain healthy due to the fixed cost model and high operating leverage.
OPM is expected to expand to 37.16%.
PAT is expected to move to Rs 240mn a rise of 41.1% YoY and 9.5% sequentially.
Jagran Prakashan (Rating: BUY; Target Price: Rs 157)
With the end of the festive season, we expect revenues to marginally decline by 2.8%sequentially but increase 17.7% YoY with ad revenue growth of 18% YoY .
Operating margins are expected to decline by 258bps on a sequential basis but increase by
200bps YoY on the back of an increase in raw material cost and lower advertisement revenue.
PAT is expected to grow by 28% YoY but decline marginally by 2.6% on a sequential basis.
Sun TV (Rating: BUY; Target Price: Rs 594)
After the blockbuster performance of the movie business, we believe that the revenues shouldgo down by 23.9% sequentially. However, sustained ad growth should boost revenues on a YoY
basis by 16.1%. We have modeled a 14% YoY ad revenue growth for the quarter.
EBITDA margins are expected to fall from the all time high margins of 84.4% in Q4FY10 to
78.1%.
PAT is expected to grow by 8.7% YoY but shrink by 20.4% sequentially.
ZEE Entertainment Enterprises (Rating: HOLD; Target Price: Rs 139)
Due to the lack of one time income from the selling of sports rights, revenues are expected togo down by 9.9% sequentially but go up by 14.5% on a YoY basis.
EBITDA margins are also expected to go down by 343 bps sequentially due to the lack of one
time income. EBITDA is expected to drop by 3.9% YoY. We believe an increase in original
programming hours and losses in sports vertical would impact operating margins.
PAT is expected to shrink by 21.2% on a QoQ basis and by 0.2% on a YoY basis.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Sports to hobble ad revenues
With the festive season coming to an end, and sports
grabbing eyeballs in this quarter, revenues for media
companies are expected to drop in the quarter
sequentially by 10.6%. However, we expect them to
grow on a YoY basis by 20.5%. With ad revenue under
pressure and margins declining we believe the PAT will
grow by 15% YoY basis but de-grow by 21% QoQ.
Expect positive surprises from ZEEL, Dish TV and Info
Edge.
Increased ad spend to boost revenues: The absence
of a festive season and a sports heavy calendar is
expected to drive away ad revenues from media
companies under coverage. We estimate Sun TV to post
the lowest ad revenue growth of 14% while ZEEL, HT
Media and Jagran are expected to post ad growth of
18-21%. Print is expected to fare better with a 2% drop
in revenues (QoQ) while broadcasting is estimated to
witness a drop of 5% in revenues.
DTH revenues to boost broadcasting space:
Continuing the momentum of subscriber additions, we
expected DTH revenues to increase in this quarter due
to significant addition to DTH subscriber base in this
sports heavy period. Renewal of contract for Sun TV is
expected during the quarter.
Margins expand: Margins for the industry are expected
to shrink by 272 bps YoY and 493 bps sequentially on
the back of increased newsprint prices and high
programming cost coupled with lower ad growth.
Profits show steady growth: Profits are expected to
show a steady growth in the quarter by 15.4% on a YoY
basis. Sequentially, PAT is expected to go down by
23.2%. Print is expected to outperform the
broadcasting space by growing at 50% compared to
4.1% for the broadcasting space.
Overweight on the sector: We remain overweight on
the sector and have a BUY rating on Sun TV, Jagran
Prakashan, ENIL and Dish TV. We have a HOLD on Info
Edge, ZEEL and HT Media and Balaji Telefilms.
Balaji (Rating: Hold ;Target Price: Rs 38)
With no new launches in the commissioned category apart from regional programmes, we
expect revenue to be muted with a dip of 2.8% sequentially.
Operating margins are also expected to suffer, going down by 75bps sequentially with EBIDTA
loss at Rs1.8mn.
PAT growth is expected to slow down by 64.5% during the quarter due to the cancellation of
shows that were operational in the last year and lower other income.
Dish TV (Rating: BUY ;Target Price: Rs 81)
We expect 0.8mn subscriber additions due to the ongoing cricket season and hence we expectDish TV to post handsome gains on the revenue front at Rs 4426mn up 42.8% from Q4FY10 and
up 16% sequentially.
Margin expansion is expected due to fixed content cost. We believe margin will expand to
17.5% up by 602bps from Q4FY10.
It is expected to show PAT loss of Rs413mn down from Rs602mn in Q4FY10
ENIL (Standalone) (Rating: BUY ;Target Price: Rs 295)
Ad rate hike in August is expected to boost revenues of the company by 22%. However, weexpect revenues to decrease on a sequential basis post the festive season.
Low royalty payment structure implemented through the quarter should boost the margins by
979bps in the quarter from 24.2% in Q4FY10 to 364% in Q4FY11.
Profitability is also expected to see a jump of 214.6% from Rs 48mn to Rs 150mn
HT Media (Rating: HOLD; Target Price: Rs 166)
Revenue growth for the quarter is projected at 18.6% YoY for the quarter due to strong growthin advertising at 21% for the quarter. We believe circulation revenues will decline by 7% QoQ
due to the recent price cuts and lower circulation on back of holiday season in schools.
We believe that the operating projects will drop by 668bps in the quarter due to higher raw
material prices.
We expect PAT to shrink by 11.6% YoY to Rs438mn due to lower operating margins.
Info Edge (Rating: HOLD; Target Price: Rs 553)
We expect 26.1% YoY increase and a strong 10.3% sequential increase in sales on the back ofstrong demand from the recruitment vertical.
We expect margins to remain healthy due to the fixed cost model and high operating leverage.
OPM is expected to expand to 37.16%.
PAT is expected to move to Rs 240mn a rise of 41.1% YoY and 9.5% sequentially.
Jagran Prakashan (Rating: BUY; Target Price: Rs 157)
With the end of the festive season, we expect revenues to marginally decline by 2.8%sequentially but increase 17.7% YoY with ad revenue growth of 18% YoY .
Operating margins are expected to decline by 258bps on a sequential basis but increase by
200bps YoY on the back of an increase in raw material cost and lower advertisement revenue.
PAT is expected to grow by 28% YoY but decline marginally by 2.6% on a sequential basis.
Sun TV (Rating: BUY; Target Price: Rs 594)
After the blockbuster performance of the movie business, we believe that the revenues shouldgo down by 23.9% sequentially. However, sustained ad growth should boost revenues on a YoY
basis by 16.1%. We have modeled a 14% YoY ad revenue growth for the quarter.
EBITDA margins are expected to fall from the all time high margins of 84.4% in Q4FY10 to
78.1%.
PAT is expected to grow by 8.7% YoY but shrink by 20.4% sequentially.
ZEE Entertainment Enterprises (Rating: HOLD; Target Price: Rs 139)
Due to the lack of one time income from the selling of sports rights, revenues are expected togo down by 9.9% sequentially but go up by 14.5% on a YoY basis.
EBITDA margins are also expected to go down by 343 bps sequentially due to the lack of one
time income. EBITDA is expected to drop by 3.9% YoY. We believe an increase in original
programming hours and losses in sports vertical would impact operating margins.
PAT is expected to shrink by 21.2% on a QoQ basis and by 0.2% on a YoY basis.
No comments:
Post a Comment