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India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://www.kotaksecurities.com/pdf/dmb/MorningInsight07032012.pdf
MEDIA SECTOR UPDATE
Key gainers of IRS results released yesterday were unlisted entities - The
Times of India added 149,000 readers (q/q), while Patrika added 357,000
readers and Prabhat Khabar added 124,000 readers in the quarter. Key loser
was Deccan Chronicle, which lost 60,000 readers (-5.5%). Dainik Bhaskar
surprisingly lost 274,000 readers (-1.8%). Among other listed entities, HT
Media continued to perform strongly across editions, although gains made
in Mumbai were devitalized by strong readership growth of TOI and
Mumbai Mirror. We see little impact of these figures on stocks under our
coverage. Maintain our investment thesis on newspaper publishers on cheap
valuations (BUY). Trends in key editions of HT Media sustain, maintained as
our preferred pick.
q IRS 4Q11 results were announced yesterday: Among the listed entities, HT
Media's newspaper properties continued to show strong trends. Jagran
Prakashan and DB Corp's Dainik Bhaskar showed weak trends, with growth of -
0.3% and -1.8% respectively. Deccan Chronicle, flagship newspaper of Deccan
Chronicle Holdings Limited (Not Covered) was the major loser among listed entities. Overall (including non-listed entities), Patrika led the gains among Hindi
newspapers, while The Times of India (TOI) led the growth in English newspapers.
q Losses of DB Corp, Jagran are minor; Gains of HT Media not impressive
enough to affect stock price: We believe the losses of DB Corp and Jagran
Prakashan in their respective flagship dailies is minor and is unlikely to have an
impact on these companies/ stocks. Dainik Jagran and Dainik Bhaskar continue
to be clear #1 and #2 players in the Hindi newspaper space. While Hindustan
Times - Mumbai continues to grow in readership, gains of HT Mumbai would
have reduced impact considering strong readership additions of TOI - Mumbai as
well as sister publication Mumbai Mirror (tabloid).
q Trends Remain Strong for HT Media in large markets, retain as preferred
pick: Although 4Q 2011 IRS results are not a revelation in any sense, trends in
key HT Media editions remain strong. HT continues to lead TOI in Delhi, retaining its cash cow. Hindustan (+12K, q/q), Mint (+5K, q/q), and HT Mumbai
(+29K), continued to add readers. HT Media has been investing in some of the
largest markets in India, and continues to make headway in these editions.
There are large gaps in yield/ reader of HT Media's properties and the leader in
these markets, which are likely to be a significant margin/ value driver for the
company. The results reinforce our conviction in the monetization potential for
HT Media, although the contraction of the price - value gap shall not be hastened by these results.
q Weak Valuations an Opportunity, Triggers Lacking; Maintain BUY with a
medium/ long-term view: Newspaper publishers in our coverage universe
trade between 13x-14x PER FY13E. Given that current circumstances are especially adverse (high newsprint prices, along with weakness in advertising environment), we believe there is an investment case for all newspaper publishers. Triggers over the next two quarters are absent, however, with strong earnings expectations for Jagran Prakashan in 4QFY12 being the only bright spot. Cooling pulp
prices provide hope that newsprint prices could fall, providing a relief, and leading to an end in earning downgrades. Recommend investing with a medium-long
term view. Protracted weakness in advertising environment, and strength in
newsprint prices are key risks.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://www.kotaksecurities.com/pdf/dmb/MorningInsight07032012.pdf
MEDIA SECTOR UPDATE
Key gainers of IRS results released yesterday were unlisted entities - The
Times of India added 149,000 readers (q/q), while Patrika added 357,000
readers and Prabhat Khabar added 124,000 readers in the quarter. Key loser
was Deccan Chronicle, which lost 60,000 readers (-5.5%). Dainik Bhaskar
surprisingly lost 274,000 readers (-1.8%). Among other listed entities, HT
Media continued to perform strongly across editions, although gains made
in Mumbai were devitalized by strong readership growth of TOI and
Mumbai Mirror. We see little impact of these figures on stocks under our
coverage. Maintain our investment thesis on newspaper publishers on cheap
valuations (BUY). Trends in key editions of HT Media sustain, maintained as
our preferred pick.
q IRS 4Q11 results were announced yesterday: Among the listed entities, HT
Media's newspaper properties continued to show strong trends. Jagran
Prakashan and DB Corp's Dainik Bhaskar showed weak trends, with growth of -
0.3% and -1.8% respectively. Deccan Chronicle, flagship newspaper of Deccan
Chronicle Holdings Limited (Not Covered) was the major loser among listed entities. Overall (including non-listed entities), Patrika led the gains among Hindi
newspapers, while The Times of India (TOI) led the growth in English newspapers.
q Losses of DB Corp, Jagran are minor; Gains of HT Media not impressive
enough to affect stock price: We believe the losses of DB Corp and Jagran
Prakashan in their respective flagship dailies is minor and is unlikely to have an
impact on these companies/ stocks. Dainik Jagran and Dainik Bhaskar continue
to be clear #1 and #2 players in the Hindi newspaper space. While Hindustan
Times - Mumbai continues to grow in readership, gains of HT Mumbai would
have reduced impact considering strong readership additions of TOI - Mumbai as
well as sister publication Mumbai Mirror (tabloid).
q Trends Remain Strong for HT Media in large markets, retain as preferred
pick: Although 4Q 2011 IRS results are not a revelation in any sense, trends in
key HT Media editions remain strong. HT continues to lead TOI in Delhi, retaining its cash cow. Hindustan (+12K, q/q), Mint (+5K, q/q), and HT Mumbai
(+29K), continued to add readers. HT Media has been investing in some of the
largest markets in India, and continues to make headway in these editions.
There are large gaps in yield/ reader of HT Media's properties and the leader in
these markets, which are likely to be a significant margin/ value driver for the
company. The results reinforce our conviction in the monetization potential for
HT Media, although the contraction of the price - value gap shall not be hastened by these results.
q Weak Valuations an Opportunity, Triggers Lacking; Maintain BUY with a
medium/ long-term view: Newspaper publishers in our coverage universe
trade between 13x-14x PER FY13E. Given that current circumstances are especially adverse (high newsprint prices, along with weakness in advertising environment), we believe there is an investment case for all newspaper publishers. Triggers over the next two quarters are absent, however, with strong earnings expectations for Jagran Prakashan in 4QFY12 being the only bright spot. Cooling pulp
prices provide hope that newsprint prices could fall, providing a relief, and leading to an end in earning downgrades. Recommend investing with a medium-long
term view. Protracted weakness in advertising environment, and strength in
newsprint prices are key risks.
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