TV18 Broadcast - Q4FY13 Result Update - Kotak

TV18's 4QFY13 financials have come in lower that our expectations on account of weakening profitability in the news operations of the company as well as the company's new channels held under Viacom 18 JV. Declining profits in both news and new channels of Viacom18 are largely attributable to stronger marketing spends in the quarter. Positives from the results include continued traction in net distribution revenues, continued strength in the relatively older entertainment operations, and substantial reduction in debt (consolidated net debt under Rs 2Bn).

TV18 remains one of the few comprehensive broadcasting plays on DAS rollout, and discount of 53% on an EV/ Sales basis relative to ZEEL, represents significant opportunity. Maintain BUY, while we lower our price target to Rs 36 (earlier Rs 40) to account for weaker earnings visibility as the company is making significant content and distribution expenses in several genres at once.

Source : Equity Bulls

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