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Jagran Prakashan (JPL) continues to remain a leader in UP, the largest state of
India, and stands No. 2 in the second largest state, Bihar, with a readership of
~5.4cr and covers ~70% of Hindi speaking readers. Also, the company's presence
in tier-II cities provides opportunity to create a strong foothold in the faster growing
markets. The company successfully launched Punjabi Jagran (now JPL caters to
five different languages). JPL launched the 11th edition of The Inquilab, the largest
read Urdu newspaper in UP and New Delhi, through its subsidiary Mid-Day
Infomedia Ltd. City Plus launched four more editions, now totaling 30 editions.
We expect JPL to post a 9% CAGR in its top line over FY2011-13E, driven by the
~10% CAGR in advertising revenue and a ~3% CAGR in circulation revenue. The
other businesses and MML are estimated to record a CAGR of ~11% and 13%,
respectively, during the mentioned period on better traction. In terms of earnings,
we expect JPL to report a CAGR of 7% over FY2011-13E, driven by top-line growth,
various cost-curtailment measures and improving profitability in the nascent businesses.
The underperformance of the stock and attractive valuations (at the CMP, the stock
trades at 14.3x FY2013E EPS) provide a good entry point for investors. Hence, we
maintain our Buy view on the stock with a target price of `137.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Jagran Prakashan (JPL) continues to remain a leader in UP, the largest state of
India, and stands No. 2 in the second largest state, Bihar, with a readership of
~5.4cr and covers ~70% of Hindi speaking readers. Also, the company's presence
in tier-II cities provides opportunity to create a strong foothold in the faster growing
markets. The company successfully launched Punjabi Jagran (now JPL caters to
five different languages). JPL launched the 11th edition of The Inquilab, the largest
read Urdu newspaper in UP and New Delhi, through its subsidiary Mid-Day
Infomedia Ltd. City Plus launched four more editions, now totaling 30 editions.
We expect JPL to post a 9% CAGR in its top line over FY2011-13E, driven by the
~10% CAGR in advertising revenue and a ~3% CAGR in circulation revenue. The
other businesses and MML are estimated to record a CAGR of ~11% and 13%,
respectively, during the mentioned period on better traction. In terms of earnings,
we expect JPL to report a CAGR of 7% over FY2011-13E, driven by top-line growth,
various cost-curtailment measures and improving profitability in the nascent businesses.
The underperformance of the stock and attractive valuations (at the CMP, the stock
trades at 14.3x FY2013E EPS) provide a good entry point for investors. Hence, we
maintain our Buy view on the stock with a target price of `137.
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