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G o o d r e s u l t s d e s p i t e m u t e d a d g r o w t h …
Jagran Prakashan’s Q1FY12 results were better than our estimates
despite muted ad growth of just ~8%. The company reported a topline
of | 304.6 crore against our expectation of | 295.5 crore, growing 12.9%
YoY. Ad revenues grew 7.7% to | 204.3 crore. EBITDA stood at | 82.1
crore against our estimate of | 71.7 crore. The EBITDA margin,
however, contracted by 648 bps YoY to 26.9% primarily due to a rise in
input costs, which grew by 30.9% YoY to | 98.9 crore. On a QoQ basis,
however, the EBITDA margin improved by 166 bps. PAT for the quarter
stood at | 49.7 core, de growing 10.5% YoY.
ƒ Highlights for quarter
During the quarter, the company reported ad revenue growth of
7.7% YoY, which is significantly less than that of DB Corp (20.0%).
The management has indicated that the dip in ad growth has been
due to lower volume caused by the company’s refusal to offer
discounts in ad prices. Circulation revenues stood at | 58.2 crore
growing 5.2% YoY while the number of copies circulated increased
~12% QoQ.
The other business performed well and compensated for the muted
ad revenue growth. Event & outdoor revenues grew ~ 275% to |
35.4 crore. The digital business also performed well with a topline
growth of ~42%.
V a l u a t i o n
Ad revenue growth has slowed down in Q1FY12 but we expect it to
recover in the coming quarters and grow by 13.7% in FY12. However,
margins would remain under pressure due to rising news print prices
and increased circulation. At the CMP of | 115, Jagran Prakashan is
trading at 13.9x FY13E EPS of | 8.3. We have valued the stock at 16x
FY13 EPS to arrive at a target price of | 133. This implies an upside of
15%. We have upgraded the stock from HOLD to BUY.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
G o o d r e s u l t s d e s p i t e m u t e d a d g r o w t h …
Jagran Prakashan’s Q1FY12 results were better than our estimates
despite muted ad growth of just ~8%. The company reported a topline
of | 304.6 crore against our expectation of | 295.5 crore, growing 12.9%
YoY. Ad revenues grew 7.7% to | 204.3 crore. EBITDA stood at | 82.1
crore against our estimate of | 71.7 crore. The EBITDA margin,
however, contracted by 648 bps YoY to 26.9% primarily due to a rise in
input costs, which grew by 30.9% YoY to | 98.9 crore. On a QoQ basis,
however, the EBITDA margin improved by 166 bps. PAT for the quarter
stood at | 49.7 core, de growing 10.5% YoY.
ƒ Highlights for quarter
During the quarter, the company reported ad revenue growth of
7.7% YoY, which is significantly less than that of DB Corp (20.0%).
The management has indicated that the dip in ad growth has been
due to lower volume caused by the company’s refusal to offer
discounts in ad prices. Circulation revenues stood at | 58.2 crore
growing 5.2% YoY while the number of copies circulated increased
~12% QoQ.
The other business performed well and compensated for the muted
ad revenue growth. Event & outdoor revenues grew ~ 275% to |
35.4 crore. The digital business also performed well with a topline
growth of ~42%.
V a l u a t i o n
Ad revenue growth has slowed down in Q1FY12 but we expect it to
recover in the coming quarters and grow by 13.7% in FY12. However,
margins would remain under pressure due to rising news print prices
and increased circulation. At the CMP of | 115, Jagran Prakashan is
trading at 13.9x FY13E EPS of | 8.3. We have valued the stock at 16x
FY13 EPS to arrive at a target price of | 133. This implies an upside of
15%. We have upgraded the stock from HOLD to BUY.
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