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Media
Slowing economy hurts ad growth
Q3FY12 is expected to be a subdued quarter for Media companies on
the ad front, in spite of the festive season due to slowing economic
growth. Also, corporates tend to cut down their ad spends to cushion
rising input cost and high interest rates. While TV is expected to feel the
highest heat of economic slowdown as national advertisers are the first
one to decrease ad spends, Print media would be partially insulated due
to their exposure to regional advertisers. We expect our media universe
to post an ad revenue growth of 9.0% YoY and 11.2% QoQ.
Dish TV – Beneficiary of digitisation
Even the DTH industry would feel the heat of economic slowdown with
lower net adds than the festive season last year. We expect the DTH
industry to add 3.1 million subscribers as compared to 3.7 million in
Q3FY11. We expect Dish TV to have a share in net additions of 25%
which corresponds to 0.8 million subscribers. We expect ARPU to
increase from | 152 in Q2FY12 to | 155 in Q3FY12 on increasing share
of HD channels and price hike. However, forex losses will remain a
cause of concern.
Multiplexes - Occupancy to fall; ATP to rise
Multiplexes are expected to see a sequential dip in their occupancy
since ATP was higher across the board in the backdrop of festive season
and much awaited movies like “Ra.One”, “The Dirty Picture”, and
“Rockstar”. According to media sources the three movies together have
already had box office collections of | 247.7 crore. We expect
occupancy to decrease by 1-2 percentage points QoQ. Nonetheless,
most of the movies didn’t perform as expected on the box office,
resulting in lower occupancy and subdued margins even during festive
season.
Profitability to show mixed trend
Margins across print players are expected to contract YoY due to higher
employee costs and higher SG&A costs due to progressive launches
during the year. Regional players are increasing their dependence on
domestic newsprint and hence are less exposed to forex losses.
Multiplexes are expected to witness lower occupancy leading to
contraction of margins. Dish TV is expected to witness margin
expansion due to pre booking of commission costs of ~ | 15 crore Company specific view
Cinemax The company rolled out two properties in this quarter - one in Surat with three
screens and another Bangalore with six screens. Although movies like Ra One and
Dirty Picture succeeded in pulling in patrons in this quarter, occupancy for the quarter
is expected to fall marginally to 31%. However, ATP is expected to remain stable at
| 136.
DB Corp We expect modest ad growth of 12.0% YoY mainly due to the economic slowdown
causing a reduction of ad spend in the industry. However, we expect the margins to
improve due to cooling newsprint prices and reduced operational expenses as there
were no new launches in this quarter.
Dish TV We expect the company to increase the subscriber additions to 0.8 million from 0.6
million backed by the festive season and aggressive marketing. With increasing
share of HD subscribers, price hike and low pack subscribers shifting to higher pack,
we expect ARPU to grow 2.0% to | 155. The digitisation mandate by government is
expected to speed up the subscriber addition for the company. However, the rupee
depreciation will remain a cause of concern.
ENIL We expect ad revenues to grow by 6.3% in Q3FY12. Inventory utilization is expected
to remain high at ~90% in the top eight stations while for the other 24 stations it is
expected to be ~62%. Realisation per slot is expected to rise to | 290 per slot from |
267 in Q2FY11. Most of the growth would be price led since the top 8 stations are
already operating at peak capacity.
HT Media We expect English ad revenues to grow 8.0% YoY and Hindi ad revenues to grow
14.0% YoY. Revenues from the radio segment are expected at | 21.8 crore, growing
20.0% YoY. The margins are expected to expand due to lower newsprint and SG&S
expenses.
Jagran
Prakashan
We expect ad revenues to grow at 10.0% YoY owing to the economic slowdown
leading to lower ad spend in the industry. However, we expect the margins to expand
in this quarter due to lower marketing costs as there werent any new launches made
in the quarter.
PVR Occupancy is expected to fall from the exceptional levels reached in Q2FY12 but will
continue to remain high at 34% led by success of movies like Ra One and Dirty
Picture. ATP and SPH are expected to improve to | 154 and | 41 respectively. PVR
has rolled out a property in Delhi.
Source: Company, ICICIdirect.com Researchin
Q2FY12 which were supposed to be incurred in Q3FY12. Our universe
coverage EBITDA margin is expected to improve by ~250 bps QoQ as
well as YoY to 21.2%.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Media
Slowing economy hurts ad growth
Q3FY12 is expected to be a subdued quarter for Media companies on
the ad front, in spite of the festive season due to slowing economic
growth. Also, corporates tend to cut down their ad spends to cushion
rising input cost and high interest rates. While TV is expected to feel the
highest heat of economic slowdown as national advertisers are the first
one to decrease ad spends, Print media would be partially insulated due
to their exposure to regional advertisers. We expect our media universe
to post an ad revenue growth of 9.0% YoY and 11.2% QoQ.
Dish TV – Beneficiary of digitisation
Even the DTH industry would feel the heat of economic slowdown with
lower net adds than the festive season last year. We expect the DTH
industry to add 3.1 million subscribers as compared to 3.7 million in
Q3FY11. We expect Dish TV to have a share in net additions of 25%
which corresponds to 0.8 million subscribers. We expect ARPU to
increase from | 152 in Q2FY12 to | 155 in Q3FY12 on increasing share
of HD channels and price hike. However, forex losses will remain a
cause of concern.
Multiplexes - Occupancy to fall; ATP to rise
Multiplexes are expected to see a sequential dip in their occupancy
since ATP was higher across the board in the backdrop of festive season
and much awaited movies like “Ra.One”, “The Dirty Picture”, and
“Rockstar”. According to media sources the three movies together have
already had box office collections of | 247.7 crore. We expect
occupancy to decrease by 1-2 percentage points QoQ. Nonetheless,
most of the movies didn’t perform as expected on the box office,
resulting in lower occupancy and subdued margins even during festive
season.
Profitability to show mixed trend
Margins across print players are expected to contract YoY due to higher
employee costs and higher SG&A costs due to progressive launches
during the year. Regional players are increasing their dependence on
domestic newsprint and hence are less exposed to forex losses.
Multiplexes are expected to witness lower occupancy leading to
contraction of margins. Dish TV is expected to witness margin
expansion due to pre booking of commission costs of ~ | 15 crore Company specific view
Cinemax The company rolled out two properties in this quarter - one in Surat with three
screens and another Bangalore with six screens. Although movies like Ra One and
Dirty Picture succeeded in pulling in patrons in this quarter, occupancy for the quarter
is expected to fall marginally to 31%. However, ATP is expected to remain stable at
| 136.
DB Corp We expect modest ad growth of 12.0% YoY mainly due to the economic slowdown
causing a reduction of ad spend in the industry. However, we expect the margins to
improve due to cooling newsprint prices and reduced operational expenses as there
were no new launches in this quarter.
Dish TV We expect the company to increase the subscriber additions to 0.8 million from 0.6
million backed by the festive season and aggressive marketing. With increasing
share of HD subscribers, price hike and low pack subscribers shifting to higher pack,
we expect ARPU to grow 2.0% to | 155. The digitisation mandate by government is
expected to speed up the subscriber addition for the company. However, the rupee
depreciation will remain a cause of concern.
ENIL We expect ad revenues to grow by 6.3% in Q3FY12. Inventory utilization is expected
to remain high at ~90% in the top eight stations while for the other 24 stations it is
expected to be ~62%. Realisation per slot is expected to rise to | 290 per slot from |
267 in Q2FY11. Most of the growth would be price led since the top 8 stations are
already operating at peak capacity.
HT Media We expect English ad revenues to grow 8.0% YoY and Hindi ad revenues to grow
14.0% YoY. Revenues from the radio segment are expected at | 21.8 crore, growing
20.0% YoY. The margins are expected to expand due to lower newsprint and SG&S
expenses.
Jagran
Prakashan
We expect ad revenues to grow at 10.0% YoY owing to the economic slowdown
leading to lower ad spend in the industry. However, we expect the margins to expand
in this quarter due to lower marketing costs as there werent any new launches made
in the quarter.
PVR Occupancy is expected to fall from the exceptional levels reached in Q2FY12 but will
continue to remain high at 34% led by success of movies like Ra One and Dirty
Picture. ATP and SPH are expected to improve to | 154 and | 41 respectively. PVR
has rolled out a property in Delhi.
Source: Company, ICICIdirect.com Researchin
Q2FY12 which were supposed to be incurred in Q3FY12. Our universe
coverage EBITDA margin is expected to improve by ~250 bps QoQ as
well as YoY to 21.2%.
Company specific view
Cinemax The company rolled out two properties in this quarter - one in Surat with three
screens and another Bangalore with six screens. Although movies like Ra One and
Dirty Picture succeeded in pulling in patrons in this quarter, occupancy for the quarter
is expected to fall marginally to 31%. However, ATP is expected to remain stable at
| 136.
DB Corp We expect modest ad growth of 12.0% YoY mainly due to the economic slowdown
causing a reduction of ad spend in the industry. However, we expect the margins to
improve due to cooling newsprint prices and reduced operational expenses as there
were no new launches in this quarter.
Dish TV We expect the company to increase the subscriber additions to 0.8 million from 0.6
million backed by the festive season and aggressive marketing. With increasing
share of HD subscribers, price hike and low pack subscribers shifting to higher pack,
we expect ARPU to grow 2.0% to | 155. The digitisation mandate by government is
expected to speed up the subscriber addition for the company. However, the rupee
depreciation will remain a cause of concern.
ENIL We expect ad revenues to grow by 6.3% in Q3FY12. Inventory utilization is expected
to remain high at ~90% in the top eight stations while for the other 24 stations it is
expected to be ~62%. Realisation per slot is expected to rise to | 290 per slot from |
267 in Q2FY11. Most of the growth would be price led since the top 8 stations are
already operating at peak capacity.
HT Media We expect English ad revenues to grow 8.0% YoY and Hindi ad revenues to grow
14.0% YoY. Revenues from the radio segment are expected at | 21.8 crore, growing
20.0% YoY. The margins are expected to expand due to lower newsprint and SG&S
expenses.
Jagran
Prakashan
We expect ad revenues to grow at 10.0% YoY owing to the economic slowdown
leading to lower ad spend in the industry. However, we expect the margins to expand
in this quarter due to lower marketing costs as there werent any new launches made
in the quarter.
PVR Occupancy is expected to fall from the exceptional levels reached in Q2FY12 but will
continue to remain high at 34% led by success of movies like Ra One and Dirty
Picture. ATP and SPH are expected to improve to | 154 and | 41 respectively. PVR
has rolled out a property in Delhi.
Source: Company, ICICIdirect.com Research
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