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C h a l l e n g i n g t i m e s …
Entertainment Network India Ltd (ENIL) reported its Q3FY12 numbers that
were slightly below our expectations on the topline front but surprised
positively on the bottomline front. The standalone topline stood at | 75.6
crore against our expectation of | 80.1 crore, de-growing 2.5% YoY on
the back of a 0.8% decline in ad revenue. The consolidated topline for the
company stood at | 81.6 crore against our expectation of | 76.8 crore.
However, the company reported a substantial jump in EBITDA margins,
which stood at 41.0% expanding 466 bps YoY on the back of significantly
lower administrative expenses. The consolidated EBITDA margin stood at
40.6%. The company reported standalone PAT of | 18.2 crore growing
45.8% YoY against the PAT of Q3FY11 adjusted for exceptional items.
The consolidated profit stood at | 18.4 crore.
Highlights of the quarter
The radio segment reported an ad revenue decline of 0.8% to | 74.0 crore
primarily due to the absence of high yielding customers who were
replaced by low yielding ones. Blended capacity utilisation, however, saw
an increase from 62% in Q3FY11 to ~69% in Q3FY12. Standalone
EBITDA margins increased to 41.0% from 36.4% in Q3FY11 primarily due
to lower administrative expenses that declined from | 21.0 crore to | 11.0
crore.
V a l u a t i o n
We have valued the stock on an SOTP basis, evaluating the radio
business on DCF and event business on EV/sales. Assuming revenue
CAGR of 12.6% over FY11E-20E and terminal growth of 4%, thereon, we
have arrived at a target price of | 289/share for the radio business. We
have valued the event business at 1.0x FY13 EV/sales to arrive at a
valuation of | 2/share and assigned a target price of | 291. The stock is
currently trading at | 231. Our target price implies an upside potential of
26%. We continue to rate the stock as BUY.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
C h a l l e n g i n g t i m e s …
Entertainment Network India Ltd (ENIL) reported its Q3FY12 numbers that
were slightly below our expectations on the topline front but surprised
positively on the bottomline front. The standalone topline stood at | 75.6
crore against our expectation of | 80.1 crore, de-growing 2.5% YoY on
the back of a 0.8% decline in ad revenue. The consolidated topline for the
company stood at | 81.6 crore against our expectation of | 76.8 crore.
However, the company reported a substantial jump in EBITDA margins,
which stood at 41.0% expanding 466 bps YoY on the back of significantly
lower administrative expenses. The consolidated EBITDA margin stood at
40.6%. The company reported standalone PAT of | 18.2 crore growing
45.8% YoY against the PAT of Q3FY11 adjusted for exceptional items.
The consolidated profit stood at | 18.4 crore.
Highlights of the quarter
The radio segment reported an ad revenue decline of 0.8% to | 74.0 crore
primarily due to the absence of high yielding customers who were
replaced by low yielding ones. Blended capacity utilisation, however, saw
an increase from 62% in Q3FY11 to ~69% in Q3FY12. Standalone
EBITDA margins increased to 41.0% from 36.4% in Q3FY11 primarily due
to lower administrative expenses that declined from | 21.0 crore to | 11.0
crore.
V a l u a t i o n
We have valued the stock on an SOTP basis, evaluating the radio
business on DCF and event business on EV/sales. Assuming revenue
CAGR of 12.6% over FY11E-20E and terminal growth of 4%, thereon, we
have arrived at a target price of | 289/share for the radio business. We
have valued the event business at 1.0x FY13 EV/sales to arrive at a
valuation of | 2/share and assigned a target price of | 291. The stock is
currently trading at | 231. Our target price implies an upside potential of
26%. We continue to rate the stock as BUY.
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