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HT MEDIA
PRICE: RS.160 RECOMMENDATION: BUY
TARGET PRICE: RS.220 FY12E P/E: 15.1X
Recently released figures for 1Q 2011 of the Indian Readership Survey (IRS)
are a further positive for HT Media. The company's three key newspapers -
Hindustan Times, Mint, and Hindustan have all registered strong growth,
ahead of industry rates. We believe that current readership trends point to
medium term achievement of much - awaited threshold levels in several
newspapers/ editions. The company will outperform industry/ peers as
volumes/ yields rise. We re-iterate BUY on HT Media with a target price of
Rs 220.
n Strong trends for Hindustan Times in Metros - Hindustan Times continues to be
the #1 newspaper in Delhi/ NCR region, marginally ahead of The Times of India.
In Mumbai, circulation growth carried out by the company last year has begun to
show results; HT Mumbai added 75,000 readers on a q/q basis - ending with
688,000 readers.
n Mumbai numbers particularly encouraging - We find the Mumbai readership especially encouraging - HT Mumbai continues to be ahead of DNA (#3 broadsheet in Mumbai), and stays in contention to get ahead of Mumbai Mirror.
n Mint continues to grow strongly, cements position as the #2 business daily of
India - Mint added robust numbers to its readership in the quarter, with 10%
growth q/q. Mint, having grown 41% in the past year, is now well ahead of
Business Standard.
n Hindustan showing encouraging trends - Readership of Hindustan grew 19% for
the quarter (y/y), and continues to be the strongest growing newspaper among
top Hindi dailies.
n As of now, the management does not see a significant decline in growth momentum for advertising in the company's newspapers. We believe the company
shall meet our estimates of 16% growth in revenues (FY12E), on the back of
strength in readership. We expect margins to improve in FY12/ FY13 led by improving yields, and manageable rise in newsprint expenses.
n We continue to be bullish on HT Media (BUY, Price Target Rs 220), as we think:
1/ Medium - term earnings are likely to be strong on account of improving readership, 2/ newsprint expenses, although high, are now well factored in, and 3/
valuations are cheap, at 15.1x PER FY12E, 4/ Large opportunity size in some of
the company's markets can potentially lead to a strong outperformance over the
industry.
n Key risks to our investment view include: 1/ competitive risks, 2/ macroeconomic
risks relating with low adex growth, 3/ risks relating with raw material prices
(newsprint).
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
HT MEDIA
PRICE: RS.160 RECOMMENDATION: BUY
TARGET PRICE: RS.220 FY12E P/E: 15.1X
Recently released figures for 1Q 2011 of the Indian Readership Survey (IRS)
are a further positive for HT Media. The company's three key newspapers -
Hindustan Times, Mint, and Hindustan have all registered strong growth,
ahead of industry rates. We believe that current readership trends point to
medium term achievement of much - awaited threshold levels in several
newspapers/ editions. The company will outperform industry/ peers as
volumes/ yields rise. We re-iterate BUY on HT Media with a target price of
Rs 220.
n Strong trends for Hindustan Times in Metros - Hindustan Times continues to be
the #1 newspaper in Delhi/ NCR region, marginally ahead of The Times of India.
In Mumbai, circulation growth carried out by the company last year has begun to
show results; HT Mumbai added 75,000 readers on a q/q basis - ending with
688,000 readers.
n Mumbai numbers particularly encouraging - We find the Mumbai readership especially encouraging - HT Mumbai continues to be ahead of DNA (#3 broadsheet in Mumbai), and stays in contention to get ahead of Mumbai Mirror.
n Mint continues to grow strongly, cements position as the #2 business daily of
India - Mint added robust numbers to its readership in the quarter, with 10%
growth q/q. Mint, having grown 41% in the past year, is now well ahead of
Business Standard.
n Hindustan showing encouraging trends - Readership of Hindustan grew 19% for
the quarter (y/y), and continues to be the strongest growing newspaper among
top Hindi dailies.
n As of now, the management does not see a significant decline in growth momentum for advertising in the company's newspapers. We believe the company
shall meet our estimates of 16% growth in revenues (FY12E), on the back of
strength in readership. We expect margins to improve in FY12/ FY13 led by improving yields, and manageable rise in newsprint expenses.
n We continue to be bullish on HT Media (BUY, Price Target Rs 220), as we think:
1/ Medium - term earnings are likely to be strong on account of improving readership, 2/ newsprint expenses, although high, are now well factored in, and 3/
valuations are cheap, at 15.1x PER FY12E, 4/ Large opportunity size in some of
the company's markets can potentially lead to a strong outperformance over the
industry.
n Key risks to our investment view include: 1/ competitive risks, 2/ macroeconomic
risks relating with low adex growth, 3/ risks relating with raw material prices
(newsprint).
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