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http://content.icicidirect.com/mailimages/ICICIdirect_HTMedia_Q4FY12.pdf
S l o w i n g e c o n o m y s l a s h e s n u m b e r s …
HT Media reported its Q4FY12 numbers, which were considerably below
our expectations. The topline for the quarter stood at | 494.1 crore
against our estimate of | 517.3 crore, growing 5.0% YoY. Ad revenues in
the print segment grew by a mere 2.8% YoY to | 373.6 crore as
corporates cut down their ad spends in light of a challenging
macroeconomic environment. The marginal revenue growth along with
higher newsprint costs led to an 889 bps YoY dip in the EBITDA margin to
9.7%. The EBITDA stood at | 48.1 crore against our expectation of | 74.0
crore, de-growing 45.1% YoY. PAT stood at | 22.0 crore against our
expectation of | 35.1 crore, de-growing 58.4% YoY. In the wake of the
touch macroeconomic environment ahead, we have cut down our
revenue/PAT estimates for FY13 by 2.3%/17.5%. We continue to rate the
stock as HOLD.
Ad growth falters
English ad revenues, of which national ads form a major component, degrew 3.6% to | 260.6 crore while the Hindi ad revenues grew by 21.0% to
| 113.6 crore boosted by UP elections. The radio segment reported a
huge decline of 24.0% to | 19.6 crore. In the wake of a continued
challenging macroeconomic environment, we have factored in 9.3% and
11.1% growth in ad revenues in FY13 and FY14, respectively.
Newsprint prices and other expenses take a toll on margins
The EBITDA margin contracted by 889 bps due to lower ad growth
coupled with higher newsprint costs and other expenses. While other
expenses are expected to stabilise, newsprint costs will continue to
pressurise margins. We expect the EBITDA margin to improve slightly
from 14.3% in FY12 to 15.8% in FY13 and 16.6% in FY14.
V a l u a t i o n
We have valued the stock at 15x FY13 EPS to arrive at a target price of
| 121 with an upside potential of 8%. We continue to rate the stock as
HOLD.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
http://content.icicidirect.com/mailimages/ICICIdirect_HTMedia_Q4FY12.pdf
S l o w i n g e c o n o m y s l a s h e s n u m b e r s …
HT Media reported its Q4FY12 numbers, which were considerably below
our expectations. The topline for the quarter stood at | 494.1 crore
against our estimate of | 517.3 crore, growing 5.0% YoY. Ad revenues in
the print segment grew by a mere 2.8% YoY to | 373.6 crore as
corporates cut down their ad spends in light of a challenging
macroeconomic environment. The marginal revenue growth along with
higher newsprint costs led to an 889 bps YoY dip in the EBITDA margin to
9.7%. The EBITDA stood at | 48.1 crore against our expectation of | 74.0
crore, de-growing 45.1% YoY. PAT stood at | 22.0 crore against our
expectation of | 35.1 crore, de-growing 58.4% YoY. In the wake of the
touch macroeconomic environment ahead, we have cut down our
revenue/PAT estimates for FY13 by 2.3%/17.5%. We continue to rate the
stock as HOLD.
Ad growth falters
English ad revenues, of which national ads form a major component, degrew 3.6% to | 260.6 crore while the Hindi ad revenues grew by 21.0% to
| 113.6 crore boosted by UP elections. The radio segment reported a
huge decline of 24.0% to | 19.6 crore. In the wake of a continued
challenging macroeconomic environment, we have factored in 9.3% and
11.1% growth in ad revenues in FY13 and FY14, respectively.
Newsprint prices and other expenses take a toll on margins
The EBITDA margin contracted by 889 bps due to lower ad growth
coupled with higher newsprint costs and other expenses. While other
expenses are expected to stabilise, newsprint costs will continue to
pressurise margins. We expect the EBITDA margin to improve slightly
from 14.3% in FY12 to 15.8% in FY13 and 16.6% in FY14.
V a l u a t i o n
We have valued the stock at 15x FY13 EPS to arrive at a target price of
| 121 with an upside potential of 8%. We continue to rate the stock as
HOLD.
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