52-WEEK BLOCKBUSTER: UTV SOFTWARE :: Business Line

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The stock of UTV Software Communications has rallied spectacularly over the past one year. The company had a fantastic FY11, with revenues increasing 40 per cent over the previous fiscal to Rs 929.5 crore, while net profits zoomed by 154 per cent to Rs 135.5 crore.

All its three segments — television, movies and gaming, expanded and all of them also delivered positive numbers at the EBIT (earnings before interest and taxes) level.

Movies that the company released, such as Delhi Belly, were big hits at the box office.

This led the first leg of the rally.

The bigger rally came after UTV announced in July that the company the company is looking to delist.

Walt Disney, one of the existing promoters, which held a little over 50 per cent of the shares in the company made the proposal to delist from the exchanges. The proposal is to buy 19.8 per cent of the shares from other promoters. A minimum of 90 per cent shareholding needs to be achieved by Walt Disney to delist UTV Software. The balance 20 per cent stake would be bought from the public.

The price of acquisition was fixed at Rs 1,000 a share. This immediately led to a substantial spike in the stock price and it has been hovering around these levels over the past few months.

Sizzling Stocks: UTV Software & StanChart PLC :: Business Line

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UTV Software Communications zoomed almost 10 per cent on June 6, emphatically breaking out of a significant resistance level of Rs 680 which it was unable to break since April 7. The stock has settled with 11.4 per cent gains over the week, accompanied by extraordinary volumes. Since its February low of Rs 386, the stock has been on a medium-term uptrend. Long-term trend is also up since early 2009 trough. It is hovering well above its 21- and 50-day moving averages.

However, the stock is facing significant longer-term resistance at Rs 760. Strong move above this resistance will pave way for a rally to Rs 840 and then to Rs 920 in the intermediate-term. But inability to surpass Rs 760 in the near future can pull the stock down to Rs 680 and waver between Rs 680 and Rs 760 in the upcoming months. The stock has its next important supports at Rs 600 and Rs 520.

StanChart PLC — IDR (Rs 95)

Standard Chartered PLC was listed in June 2010. After a brief rally to Rs 125, it encountered resistance in August 2010. The IDR had been on a sideways consolidation phase from last August to June in the narrow band between Rs 110 and Rs 125. On June 6, it plunged 17.5 per cent with a downward gap, conclusively breaking through its key support at Rs 110 and Rs 100. The volume was heavy in that session.

It registered an all-time low of Rs 91.7 last week, which will act as an important support in the days ahead. Immediate resistance is at Rs 101.7 which is the floor of the recent gap. Key resistances are pegged at Rs 110 and Rs 115

UTV Software Communications- TARGET: ` 629- Gaming fueling the growth trajectory: Jaypee

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UTV Software Communications- Gaming fueling the growth trajectory
UTV Software Communications Ltd (UTV) is India's first integrated global media
and entertainment company with businesses spanning across film production and
distribution, gaming, TV content, TV broadcasting and new media (content on
web and mobile). It has a dominant presence in movies production business, with
the movies business contributing 49% to UTV’s operating revenues. Its
broadcasting business is also growing at a fast pace, with its youth oriented
channels garnering higher TRPs. Also, the gaming business is about to generate
returns on the investments made earlier, with 3 IP titles ready for release. UTV’s
strategic partnership with Walt Disney (with a 56.67% stake) gives UTV the access
to overseas markets.

UTV Software & Communication - Integrated entertainment play : BofA Merrill Lynch

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UTV Software & Communication Ltd 
   
Integrated entertainment play 
Having met with management today at our 15th  Annual India Investor
conference in New Delhi, these are some of our takeaways…

„Key take aways-
UTV (BBG ticker: UTV IN, Not Covered) is one of the listed integrated
entertainment company with presence in movies, broadcasting, television content
and gaming.

Reduce UTV - Target Rs 463:: Kotak Sec

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UTV SOFTWARE
RECOMMENDATION: REDUCE
TARGET PRICE: RS.463
FY12E P/E: 12.8X
q UTV reported a strong set of results for 3QFY11. Revenues and PAT were
ahead of our estimates by 11.7% and 40.4% respectively. Key surprises of
the results were improved profitability in both the television and the
games segments.
q As expected, the company has reported weaker margins for its movies
business (y/y, q/q), on account of poor performance (combined) of the
company's two major releases - Guzaarish and Tees Maar Khan.
q Games segment's profitability has been helped by the recognition of
$5mn of revenues, from the $10mn minimum guarantee deals that the
company has signed for its console game "El Shaddai", while the growth
in television appears to have come in, in our understanding, on the back
of cost savings as well, even as revenues have grown 15.2% y/y.

UTV Software - Lights, camera, action - movies direct growth; Target Rs 570 : Crisil

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UTV Software Communications Ltd
Lights, camera, action - movies direct growth
UTV Software Communications Ltd (UTV) is a diversified media and
entertainment company covering three verticals – film production and
distribution, television, and emerging segments such as gaming and
interactive. We maintain our fundamental grade of ‘3/5’, indicating that its
fundamentals are ‘good’ relative to other listed equity securities in India.

UTV Software-upgrading the stock from REDUCE to ADD :: ICICI Securities

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UTV Software -Impressive performance...
On a consolidated basis, UTV Software reported a topline of  | 255.9
crore (I-direct estimate of | 293.0 crore) improving 16.0% YoY and 6.7%
QoQ. The growth was on the back of improving revenue from the
television and gaming segment, which grew 15.3% and 116.9% YoY,
respectively. The company reported EBITDA of  | 53.4 crore against  |
37.7 crore in Q3FY10. EBITDA margins stood at 20.9%, improving 379
bps YoY and 174 bps QoQ. PAT for the quarter stood at | 40.0 crore (Idirect estimate of | 29.2 crore) as compared to | 37.8 crore in Q3FY10.

Morgan Stanley: UTV Software - Games and Television Perking Up; Stay OW with Increased PT of Rs618

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UTV Software Communications Ltd  
Games and Television Perking Up; Stay OW with  Increased PT of Rs618 

What's Changed
Price Target  Rs540.00 to Rs618.00
 F11, F12, F13 EPS estimates  Up 7%, 3%, 8% respectively
Overall, we expect an EBITDA CAGR of 45% for UTV
in F11-F13: This may come as a positive surprise to the
Street. UTV is coming close to delivering on its plan to
nudge up its games business from being a star to a cash
cow. Its other cash cow, films, continues to grow
strongly, maintaining its leadership in India’s movie
business. The television business is emerging as the
other star on the horizon for the company.

UTV Software report by UBS

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UTV Software (Not rated)
Company background
UTV is an integrated media and entertainment company with a presence in: 1)
television; 2) movies; and 3) games and interactive, including online, console
and mobile, game development and publishing and distribution. It is one of the
largest movie production houses in India with 10 movie releases planned for
2010-11.

India Media Sector Key takeaways: UBS India CEO/CFO Forum

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UBS Investment Research
India Media Sector
Key takeaways: UBS India CEO/CFO Forum


􀂄 Hathway, Dish TV and UTV participated in UBS India CEO/CFO Forum
We hosted Hathway Cable & Datacom (Hathway), Dish TV and UTV Software
(UTV) at the UBS India CEO/CFO Forum on 1-3 November 2010. Hathway was
represented by its CEO, Mr. K. Jayaraman. Dish TV was represented by its MD,
Mr. Jawahar Goel and its CFO, Mr. Rajeev Dalmia. UTV was represented by Mr.
Rajeev Wagle, Group CFO, and Mr. Amit Banka, Senior VP, Head of Business
Development and Strategy.

UTV Software - Diwali Mahurat Pick by Anand Rathi

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UTV Software


Company is in to high growth entertainment business of– TV Broadcasting, TV
Content development, Movie Production & a very niche and high margin
business of developing – Console Games for PS3 & Xbox platforms and Mobile
& Online gaming development

Promoted by Rohinton Screwala & jointly owned by Walt Disney which owns
50.4% stake right now. Ronnie owns 19.6% stake in company, but has option to
buy back 19% stake from Walt Disney in next two years at around Rs.900/- or
so [which can increase Ronnie’s stake to 38% and reduces Walt Disney’s stake
to 32%]

Most exciting future is Gaming business, where company has three console
based games ready to be launched, each of these IP owned games can fetch
significant revenues and profits

Based on significant improvements seen in all segments of the business. We
expect company to report consolidated EPS of Rs 32/- in FY 11 & Rs.52/- in FY
12. We have a target of Rs 1040 for 12 months

UTV: Met with CEO:: Motilal Oswal

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UTV: Met with CEO; Current verticals past the investment phase; Content for the 3G/4G space next big opportunity

We met with Mr Ronnie Screwvala, CEO UTV (UTV IN, Mkt Cap US$540m, CMP Rs597, Not Rated). Key takeaways:

-          The company claims to have demonstrated sustained performance and delivered results in its motion pictures and television divisions.

-          With upcoming publishing deal for its first IP in the console gaming space, all the three verticals would be past the investment phase.

-          UTV is actively looking at content creation/partnerships in the 3G/4G space which could be the next big opportunity to drive revenues for the media sector, and would require customized content development for the platform.

UTV Software: Possible multibagger: target Rs 1040 for 12 months:: Anand Rathi

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UTV Software

CMP 540/-

·         A Company, promoted by Rohinton screwala, is jointly owned by Walt Disney also, both having 3 directors on board. Though Walt Disney owns 50.4% stake right now, its voting rights are only 32%. Ronnie owns 19.6% stake in company, but has option to buy back 19% stake from Walt Disney in next two years at around Rs.900/- or so. [which can increase Ronnie’s stake to 38% and reduces Walt Disney’s stake to 32%].

·         Company is in to high growth entertainment business, with latest entertainment offerings. Apart from segments like – TV Broadcasting, TV Content development, Movie Production, etc; company is also in to a very niche and high margin business of developing – Console Games for - PS3 & Xbox platforms. This is a very big market globally [bigger then Movies] and offers high growth potential. They are also in to Mobile & Online gaming development, which ahs high growth potential.

·         TV content & Movies businesses are already profitable; while TV Broadcasting business has now turned profitable and will improve further with overall improving scene on advertising rates & subscription revenue potential. The profitability of company is rising fast in current year with all segments contributing to bottom line. Most exciting future is in Gaming business, where company has three console based games ready to be launched. For this global distribution tie ups are being worked out. Each of these IP owned games can fetch significant revenues and profits. First to be launched game could be – El Shaddai, may be in next 6-8 weeks.

Recommendation

We expect the company to perform exceedingly well in current and coming years, based on significant improvements seen in all segments of the business.  Overall outlook for entertainment business is extremely positive, looking to rising spending by new generation on this account. We expect company to report consolidated EPS of Rs 32/- in FY 11 & Rs 52/- in FY 12. We set a target of Rs 640/- for next 3 months & Rs 1040 for 12 months. BUY. 

UTV's 2QFY11 Operationally In-line says Citi research

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UTV Software Communications (UTVS.BO)
2QFY11 Operationally In-line; Gaming – The Joker in the Pack
 In-line quarter — EBIT growth of ~180% Y/Y to ~Rs420m was largely in line with
our/consensus estimates. Margins for both movies & TV increased Y/Y – a mix of
a) business turnaround and b) partly buoyed by the inventory write-off against the
net worth, which boosted ‘reported’ profits. Revenues at ~Rs2.4bn were flat Y/Y &
headline PAT increased ~4x on last year’s low base to Rs402m.
 Debt equity remains >1x — Increasing leverage is a concern – net debt increased
~Rs1bn QoQ to ~Rs10bn. As per FY10 annual report, net worth declined by
Rs6bn driven by the inventory write-down – mgmt indicates the split between
movies & broadcasting verticals was ~Rs4.5bn & ~Rs1.5bn respectively.
 Gaming – the joker in the pack? — We are currently ~35% below mgmt’s FY11E
Ignition revenue guidance as we build in some delays; however, we have ~18%
EBIT margins in FY12E assuming sale of ~1m units of El Sheddai and Reich.
Visibility on pre-sale agreements, publisher/distribution tie-ups, timelines of the
final launch (will depend on publisher), and status of the other 6-8 planned
publishing titles are important events to watch out for. Mgmt highlighted that
Indiagames has turned to black this quarter & Truegames too is expected to break
even in FY11E; however, Ignition is the key for overall segmental performance.
 Key points to focus on — a) Visibility of gaming launch timing and any indicators
determining financial performance; b) increased gearing and impact on cost of
debt; c) return ratios for movie business given the gradual reduction in business
volatility; and d) margin performance of broadcasting in future.
 Maintain Sell — Despite a marginal cut to our FY11-12E revenues forecasts, we
increase our EBIT estimates by 29-35%; factoring both the inventory write-down &
good movie business performance in 1HFY11. We reiterate Sell/High Risk and
revise our SOTP-based target price to Rs505 as we roll forward to Mar12E from
Sept11E. The stock has underperformed the market by ~115% in the last 2 years;
i t has been flat relatively in the last 6 months.

UTV, Sub-Par 2QF11 Result But Future Trends Looking Brighter; Stay OW says Morgan Stanley Research,

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UTV Software
Communications Ltd
Sub-Par 2QF11 Result But
Future Trends Looking
Brighter; Stay OW
We maintain our OW rating on UTV since we feel that
the planned release of a) console game El Shaddai and
b) high budget films like Guzarish and Tees Maar Khan
in 2HF11 will likely lead to meaningful earnings surprise
for the Street. We believe UTV, with its diversified model
with leadership in all its businesses, looks well set for a
strong growth trajectory on a 2-3 year view.
What's new: UTV delivered 2QF11 consolidated PAT of
Rs.402m, a swing of 383% compared to 2QF10 though
2.6% lower than 1QF11. EBIT of Rs.454 m was about
24% below our expectation primarily due to lower than
expected contribution from films division. EBITDA
margin of 18.4% was marginally lower than for the
previous quarter but is in line with our expectations for
FY11. 1HF11 EBIT is about 41% of our full year F11
expectations
Movie division moderately below expectations: This
segment reported EBIT of Rs447m, down 14% QoQ
though up 50% YoY contributing about 82% of UTV’s
consolidated EBIT. Given the success of movies like I
hate Luv Storys, Udaan, Peepli Live and We are Family
released in 2QF11 and the monetization of the Satellite
TV rights of Rajneeti, this was slightly lower than our
expectation. However with the strong movie slate and
with growing proportion of non-theatrical revenues, we
believe 2HF11 should see an earnings rebound for this
business.