2026-07-13 18:47:17
Latest Post
Bajaj Consumer Care Delivers Strong Performance in Q1 FY27 as Net Profit Surges 84.8% Year-on-Year
Kamdhenu Brand Steel Sales Cross 1.13 Million MT in Q1 FY27; Captive Solar Plant Commissioned in Rajasthan
JBM Electric Vehicles partners with Drivn to supply 500 Electric Buses
Kalpataru Limited Reports 17% Surge in Collections and Key Luxury Launches for Q1 FY 2026-27
Ashok Leyland Secures ₹222.65 Crore Arbitral Award Against Delhi Transport Corporation
Research
Sun TV Network - Ad revenue growth bounces back - Centrum
Posted On : 2013-01-27 01:21:54( TIMEZONE : IST )
Sun TV Network posted healthy 14.3%YoY growth in revenues on the back of 20% YoY ad revenue growth along with 28% YoY growth in analog subscription revenues. Digitisation in Chennai and implementation of Phase-II will help the company grow its DTH and analog subscription revenues. We maintain our BUY rating on the stock.
- Q3FY13 above expectations: Revenues grew by 14.3% YoY to Rs4859mn on the back of 20%YoY growth in advertising revenues and 27%YoY growth in analog subscription revenues. Operating profit was up 10% YoY to Rs3763mn as margins contracted by 279bps. Profitability was up by 13.1%YoY to Rs1899mn, 8.7% above expectations.
- Healthy advertising growth: Advertisement revenues grew by 20%YoY during the quarter on the back of strong festive season demand with growth across sectors. We have modeled 8.8% growth for FY13 and 15% for FY14E.
- Subscription revenues to grow: On a sequential basis analog subscription revenues grew by 8.8% and 28% YoY. On the back of strong DTH offtake, DTH subscriber numbers have increased by 5% QoQ to 8.3mn and hence the company posted 5% sequential growth in revenues. International subscription revenues were flat on a sequential basis.
- Margins to remain stable: Margins during the quarter contracted by 279bps on the back of high admin & other expenditure (up 51% YoY) and higher cost of revenues (up 34.7% YoY). However going forward we expect margins to remain stable at ~77-78% on a standalone basis. Movie acquisition cost will remain under Rs1bn for the next few quarters.
- Radio business: In the radio business the company posted revenues of Rs780mn in 9MFY13E with profits of ~Rs50mn. It will further bid in Phase-III auctions when they are announced
- Digitization benefits: Sun TV Network channels are expected to become pay channels in Chennai city post digitization. The management is expecting an ARPU of Rs25/month and believes that there are 2mn households in Chennai of which 1.5mn are yet to get digitized. It is expecting revenue of Rs20-25mn/month from this. For Phase-II, 5 key cities in the 4 southern states are expected to get digitized accounting for 4mn households. The management expects revenue of Rs60-70mn/month from these cities post digitization.
-Maintain BUY: The stock is currently trading at 25x and 21x FY13E and FY14E respectively. We value the stock at 23x Sept 2014 with a target price of Rs512 and maintain BUY rating on the stock.
