Jagran Prakashan Q1 FY18 Result Update Rating - HOLD - Arihant capital Markets

For the quarter ended March 2017, Jagran Prakashan Ltd. reported profitability with net profit growing by 2% YoY to Rs 78 cr and 3% sequentially.

Total revenue for the company grew by 4% YoY to Rs 492 cr while sequentially the revenue grew by 5%. Advertisement revenue for the company grew by 3.9% YoY to Rs 346 cr while the circulation revenue grew by 1.5% YoY to Rs 102 cr. Digital Advertisement revenue for the company grew by 17% YoY to Rs 7.3 cr. Page views for this quarter reached to 436.89 million while unique users reached 33.37 million.

Revenue from Dainik Jagran grew to Rs 396 cr reporting a growth of 3% YoY and 6.3% sequentially. Margins from the publication stood steady to 33.2% vs. 33.5% YoY. Revenue from Other Publications (Naidunia, I-Next, Punjabi Jagran, Josh Plus & Sakhi) came in at Rs 88 cr reporting a growth of 5.8% YoY and 5.4% sequentially with margins improving to 10.5% vs. 9.8% YoY.

EBITDA margin for the quarter augmented to 26.3% vs. 27.5% in corresponding quarter of previous year and 25.6% sequentially. This was on account of other expenses which increased to Rs 123 cr against Rs 114 cr on sequential basis. Interest expenses for the company have dropped to Rs 3.3 cr against Rs 6 cr YoY aiding the company report steady net profit margins which came in to 15.9% vs 16% YoY. Total comprehensive income for the company stood at Rs 77.65 cr.

Valuations

Media industry which thrives on discretionary spends was impacted in this quarter too. However, the overall performance of the company could withstand this unusual economic condition and reported net profit growth of 2% due to low single digit growth in advertisement revenue and circulation revenues. At CMP of Rs 172 per share the stock is trading at P/E and P/BV multiple of 10.5(x) and 2.4(x) respectively of FY19E. We have valued the stock at P/E multiple of 11(x) to FY 19E and have arrived at fair value of Rs 184 per share. We have Hold rating for the stock.

Shares of JAGRAN PRAKASHAN LTD. was last trading in BSE at Rs.169.5 as compared to the previous close of Rs. 172.3. The total number of shares traded during the day was 9267 in over 216 trades.

The stock hit an intraday high of Rs. 175 and intraday low of 169.1. The net turnover during the day was Rs. 1588306.

Source : Equity Bulls

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