Result Update November 5, 2018
Rating matrix Rating : Hold Sun TV (SUNTV) | 629
Target : | 675 Target Period : 12-15 months Market share loss visible… Potential Upside : 6%
Revenues came in at | 749.6 crore (up 10.9% YoY), lower than our What’s changed? estimate of | 763 crore. The miss was owing to advertisement Target Changed from | 920 to | 675 revenues, which witnessed 3.7% YoY growth vs. our estimate of 14% EPS FY19E Changed from | 35.9 to | 35.8 YoY growth). Subscription revenues came in at | 339.79 crore (21.3% EPS FY20E Changed from | 41.8 to | 37.5 YoY growth), much ahead of our estimate of 15.3% YoY growth, on Rating Changed from Buy to Hold account of continued benefits of Tamil Nadu digitisation EBITDA came in at | 554.3 crore, up 11.7% YoY, marginally below our Quarterly performance expectations of | 561.4 crore largely owing to lower topline. Margins Q2FY19 Q2FY18 YoY (%) Q1FY19 QoQ (%) at 73.9% were higher than our estimate of 73.5% Revenue 749.6 675.9 10.9 1,120.4 -33.1 The company reported profit of | 351.3 crore (vs. | 303.1 crore) on EBITDA 554.0 496.1 11.7 734.7 -24.6 account of lower depreciation and higher other income EBITDA (%) 73.9 73.4 51 bps 65.6 833 bps PAT 351.3 284.7 23.4 409.1 -14.1 The company has declared an interim dividend of | 2.5 per share, in addition to | 5 per share interim dividend declared during Q1FY19 Key financials Aims to wrest back market share loss; may result in higher content cost | Crore FY17 FY18 FY19E FY20E Sun TV’s Q2FY19 muted ad growth was reflective of its market share loss Net Sales 2,646 2,963 3,547 3,956 in the key Tamil market as it conceded that its ER was impacted owing to EBITDA 1,770 2,004 2,417 2,628 Net Profit 1,030 1,135 1,412 1,479 competitive pressure, resulting in impact on advertisements. Furthermore, muted ad growth of ~3.7% was also attributable to i) Kerala EPS (|) 26.1 28.8 35.8 37.5 floods (~| 7 crore impact), ii) Festive season shifting to Q3 this year (~| 7
Valuation summary crore impact) and iii) couple of prime slots not monetised due to FY17 FY18 FY19E FY20E dedicated live coverage of funeral of former Tamil Nadu chief minister P/E 24.1 21.8 17.6 16.8 (~| 3-4 crore impact). The company also relaunched its second Tamil Target P/E 25.8 23.5 18.9 18.0 GEC (Sun Life) with youth oriented programming to counter competition. EV / EBITDA 13.2 11.4 9.2 8.1 The company has reiterated it would launch a Bangla GEC in Q4FY19, P/BV 6.2 5.3 4.4 3.7 with anticipated spending of ~| 150 crore. The company also indicated it RoNW 25.6 24.2 25.1 22.3 would continue investing in fiction and non-fiction shows to gain RoCE 37.2 35.5 36.8 33.2 viewership and aims to wrest back ~10% of market share. Going ahead,
we factor in 11% CAGR (vs. 15% earlier) in ad revenues in FY18-20E to Stock data | 1620 crore. We also build in steep ~30% CAGR in cost of revenues Particular Amount (content cost) in FY18-20, given incremental spending for content in Sun Market Capitalisation | 24783.7 Crore Total Debt (FY18) | 0 Crore Life and Bangla GEC. Cash (FY18) | 372.6 Crore Subscription growth robust on TN digitisation… EV | 23635 Crore Subscription revenue growth of 21.3% YoY was the only silver lining 52 week H/L 1097/ 652 during the quarter led by cable revenues, which were up ~28% YoY to Equity capital 197.0 | 120 crore while DTH revenues were up ~20% YoY to ~| 220 crore. Face value 5.0 With benefits of TN digitisation kicking in, we expect subscription revenue Price performance growth of 17.2% CAGR (FY18-20E) to | 1564 crore by FY20E. We also highlight that the company has now shifted focus to its digital segment 1M 3M 6M 12M (Sun NXT) and now is aiming at active spending including exclusive TV Today -1.1 -6.3 -13.7 10.8 content. Sun is also in discussion with telcos to provide access of Sun TV Sun TV 1.5 -17.0 -23.9 -22.4 to subscribers. The discussion with them is in final stages. ZEEL 0.5 -14.9 -26.0 -16.6
Market share loss & film production to weigh on financials Research Analysts Concerns over rising competitive intensity have heightened, with Bhupendra Tiwary aggressive content strategy by Star, Colors and Zee in the Tamil genre [email protected] notwithstanding Sun’s intent to counter the same. We also remain Sameer Pardikar concerned about the company’s strategy of steep spending in movie [email protected] production (~| 275-300 crore) and its intent to continue the same ahead.
Given the sharp competitive intensity in the key market, and volatility on
account of movie business, we downgrade the stock to HOLD recommendation. We cut our target multiple further to 18x vs. 23x earlier and value the company at | 675/share.
ICICI Securities Ltd | Retail Equity Research
Variance analysis Q2FY19 Q2FY19E Q2FY18 Q1FY19 YoY (%) QoQ (%) Comments Revenue 749.6 763.9 675.9 1,120.4 10.9 -33.1 Ad revenue for the quarter was impacted by market share loss and certain one offs
Other Income 62.1 38.0 37.2 39.0 66.9 59.3
Raw Material Expenses 90.1 84.0 64.1 80.9 40.6 11.4 Employee Expenses 73.5 80.2 77.4 85.2 -5.1 -13.7 Marketing Expenses 0.0 0.0 0.0 0.0 NA NA Administrative Expenses 32.0 38.2 38.3 148.3 -16.5 -78.4 IPL Franchisee Fees to BCCI 0.0 0.0 0.0 71.3 NA -100.0
EBITDA 554.0 561.4 496.1 734.7 11.7 -24.6 EBITDA Margin (%) 73.9 73.5 73.4 65.6 51 bps 833 bps Depreciation 81.9 135.0 102.7 146.8 -20.3 -44.2 Interest 0.6 0.3 0.1 0.3 850.0 119.2
Total Tax 182.3 161.1 145.9 217.5 25.0 -16.2 PAT 351.3 303.1 284.7 409.1 23.4 -14.1 PAT was better despite miss in topline and EBITDA was on account lower depreciation
Key Metrics Ad Revenue Growth 3.7 14.0 6.5 19.8 -279 bps -1603 bps Subscription Revenue Growth 22.4 15.3 14.3 15.1 803 bps 729 bps Subscription growth was healthy on continued benefits of Tamil Nadu digitisation
Source: Company, ICICI Direct Research
Change in estimates es FY19E FY20E Remarks (| Crore) Old New % Change Old New % Change Revenue 3,568.1 3,546.5 -0.6 4,095.7 3,955.5 -3.4 Lower ad growth estimates to incoporate H1FY19 performance
EBITDA 2,441.1 2,417.0 -1.0 2,898.3 2,627.7 -9.3 We raise content costs estimate to incorporate company's spending on Tamil GEC market as well as Bangla GEC spending EBITDA Margin (%) 68.4 68.2 -26 bps 70.8 66.4 -433 bps PAT 1,415.2 1,411.8 -0.2 1,644.9 1,478.7 -10.1 EPS (|) 35.9 35.8 -0.2 41.8 37.5 -10.1
Source: Company, ICICI Direct Research
Assumptions Current Earlier Remarks FY16 FY17E FY18E FY19E FY20E FY19E FY20E Ad Revenue Growth -11.4% -3.3% 11.7% 15.0% 15.0% 15.0% 15.0% We lower our subscription revenue estimates as we believe digitisation benefits would be back ended Subscription Revenue Growth 10.5% 18.0% 18.5% 14.6% 21.9% 14.6% 21.9%
Source: Company, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 2
Ad revenues to grow at 11% CAGR over FY18-20E
Exhibit 1: Ad growth trend
1800 1620 15.0 1600 1445 10.0 1400 1323 1309 12.1 1172 1200 11.7 5.0 10.4 1000 5.7 (11.4) -
800 (%) | Crore | 600 (5.0) 400 (10.0) 200 0 (15.0) FY16 FY17 FY18 FY19E FY20E
Ad revenue YoY Growth (RHS)
Source: Company, ICICI Direct Research
Subscription CAGR of 17.2% in FY18-20
Exhibit 2: Subscription revenue trends
1,800.0 1,564.2 21 1,600.0 18.8 1,345.4 18 1,400.0 17.6 1,138.9 1,200.0 16.3 958.7 18.1 15 1,000.0 815.3
800.0 (%)
| crore | 12 600.0 10.6 400.0 9 200.0 - 6 FY16 FY17 FY18 FY19E FY20E
Subscription revenues YoY Growth (RHS)
Source: Company, ICICI Direct Research
EBITDA margins to be impacted by steep rise in content spending
Exhibit 3: EBITDA margins trend
80.0 70.0 66.9 67.6 68.2 66.4 70.0 60.0 50.0 38.3
40.0 % 30.0 37.3 38.9 39.8 37.4 20.0 10.0 0.0 FY16 FY17 FY18 FY19E FY20E
EBITDA Margin PAT Margin
Source: Company, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 3
BARC rating trend…
Sun TV continues to lose market share while peers, Exhibit 4: Tamil markets BARC weekly data for Q2FY19 especially Zee Tamil, have been gaining share 50.0 45.0 40.0 35.0 30.0 25.0
Market Share (%) Share Market 20.0 15.0 10.0
Wk 27
Wk 28
Wk 29
Wk 30
Wk 31
Wk 32
Wk 33
Wk 34
Wk 35
Wk 36
Wk 37
Wk 38
Wk 39 Sun TV STAR Vijay KTV Zee Tamil
Source: Company, ICICI Direct Research
Exhibit 5: Kannada markets BARC weekly data for Q2FY19 40.0 35.0 30.0 25.0 20.0 15.0
Market Share (%) Share Market 10.0 5.0
-
Wk 27
Wk 28
Wk 29
Wk 30
Wk 31
Wk 32
Wk 33
Wk 34
Wk 35
Wk 36
Wk 37
Wk 38 Wk 39 Colors Kannada Zee Kannada Udaya Movies Udaya TV
Source: Company, ICICI Direct Research
Exhibit 6: Malayalam markets BARC weekly data for Q2FY19
50.0 45.0 40.0 35.0 30.0 25.0 20.0
15.0 Market Share (%) Share Market 10.0 5.0
-
Wk 27 Wk 28 Wk 29 Wk 30 Wk 31 Wk 32 Wk 33 Wk 34 Wk 35 Wk 36 Wk 37 Wk 38 Wk 39 Asianet Surya TV Mazhavil Manorama Asianet Movies
Source: BARC, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 4
Exhibit 7: Telugu markets BARC weekly data for Q2FY19
Gemini TV down to No 4 after temporary viewership gain 29.0 during the quarter
26.0
23.0
Market Share (%) Share Market 20.0
17.0
Wk 27 Wk 28 Wk 29 Wk 30 Wk 31 Wk 32 Wk 33 Wk 34 Wk 35 Wk 36 Wk 37 Wk 38 Wk 39 STAR Maa ETV Telugu Gemini TV Zee Telugu
Source: BARC, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 5
Conference Call Highlights Ad growth impacted by one-offs & ER decline; guided for early teen ad revenue growth in H2FY19: The management indicated that apart from hit on ER due to competition, the muted ad revenue growth for the quarter was attributed to i) Kerala floods (~| 7 crore impact) ii) festive season shifting to Q3 this year (~| 7 crore impact) iii) couple of prime slots on Sun TV dedicated live coverage of funeral of former Tamil Nadu chief minister (~| 3-4 crore impact). The company maintained 10-12% ad revenue growth guidance for the industry, while asserted early teen ad revenue growth for Sun TV in H2FY19 on the back of festive season and elections in Telangana
Facing pricing pressure in Tamil Market; looking to revive market share by new programming/shows: The management indicated that they are facing pricing pressure in the Tamil market, which also had an impact on ad revenues for the quarter. The company indicated that they are looking to arrest the continuous fall in viewership market share by new shows/programming and have already launched two new shows in the Tamil market as well as one weekend show with actress Shruti Hassan. As per the management, the initial response to their second channel ‘Sun Life’ has been encouraging. Till date, investment in the channel is to the tune of | 30-40 crore. The company expects Sun Life revenues to ramp up to monthly rate of | 3-4 crore vs. current run rate of | 1-2 crore, currently
Tone down movie buying on expensive pricing; looking to scale up in house movie production: The management indicated they have strategically toned down movie acquisitions in the last two to three years as the cost of movie acquisition increased substantially. The company said they have also reduced the number of movies showcased on weekends and are now looking to scale up their own movie production business to feed the same to their channel movie need. They indicated they are releasing three movies before December 2018 including two bug budget movies (one with Rajinikanth). The company guided for | 275-300 crore for movie production while capex guidance for movie acquisition for FY19 remained at ~| 400 crore
Planning for exclusive content on Sun NXT; Bangla launch in Q4: The management indicated that their digital platform Sun Next currently has a library of more than 8000 films. They have now started to put some exclusive content on this digital platform. The company is also in discussion with telcos to provide access to Sun TV to subscribers. The discussion with them is in final stages. The company, as indicated earlier, is looking to launch a GEC Bangla channel in Q4FY19. Investment for the same is expected at | 150 crore
ICICI Securities Ltd | Retail Equity Research Page 6
Valuation Concerns over rising competitive intensity have heightened, with aggressive content strategy by Star, Colors and Zee in the Tamil genre, notwithstanding Sun intent to counter the same. We also remain concerned by the company’s strategy of steep spending in movie production (~| 275-300 crore) and its intent to continue the same ahead. Given the sharp competitive intensity in the key market and volatility on account of movie business, we downgrade the stock to HOLD recommendation. We cut our target multiple further to 18x vs. 23x earlier and value the company at | 675/share.
Exhibit 8: Valuations Sales Growth EPS Growth PE EV/EBITDA RoNW RoCE (| cr) (%) (Rs) (%) (x) (x) (%) (%) FY17 2645.7 7.0 26.1 11.8 24.1 13.2 25.6 37.2 FY18 2963.0 19.8 28.8 23.1 21.8 11.4 24.2 35.5 FY19E 3546.5 19.7 35.8 24.4 17.6 9.2 25.1 36.8 FY20E 3955.5 11.5 37.5 4.7 16.8 8.1 22.3 33.2
Source: Company, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 7
Recommendation History vs. Consensus Estimates
1,400 100 90 1,200 80 1,000 70 60 (|) 800 50 (%) 600 40 400 30 20 200 10 Dec-15 Feb-16 May-16 Aug-16 Nov-16 Jan-17 Apr-17 Jun-17 Sep-17 Dec-17 Feb-18 May-18 Aug-18 Oct-18 0 0
Price Idirect target Consensus Target Mean % Consensus with BUY
Source: Bloomberg, Company, ICICI Direct Research
Key events Date Event Aug-10 Sun TV Network floats a wholly owned subsidiary, Sun TV Network Europe Ltd in United Kingdom to broadcast and distribute its channels in U.K. and Europe Jun-11 K Vijay Kumar appointed Chief Executive Officer of the Company
Oct-11 Sun TV launches kids channel Kochu TV Jul-12 Sun TV launches four ad free movie channels and increases its pay channel offerings by three Sep-12 Sun TV inks agreement with Tamil Nadu Arasu cable TV provider Dec-12 Sun TV emerges as the winner of Hyderabad franchisee of IPL Sep-13 Sun TV reports two consecutive quarters of negative ad growth subject to the inability to pass on exorbitant price hike taken to offset the impact of Trai's 12 minute ad cap Mar-14 Ad growth rebounds and comes in positive territory with 5% YoY ad growth. Growth rebounds after hikes were re-calibrated in conjunction with markets
Jul-14 Attorney General informs CBI there was significant evidence against Marans in Aircel-Maxis case Jun-15 The Union Home Ministry denies security clearances to Sun TV’s 33 channels that could culminate in the channels going off air and cancellation of their broadcasting license Feb-17 Special 2G court drops all charges against Maran brothers with respect to their involvement in the Aircel Maxis case
Source: Company, ICICI Direct Research Top 10 Shareholders Shareholding Pattern InvestorName Rank Latest Filing Date % O/S PositionPosition (m) Change (m) (in %) Sep-17 Dec-17 Mar-18 Jun-18 Sep-18 1 Maran (Kalanithi) 30-09-2018 75.00 295.56M 0.0 Promoter 75.00 75.00 75.00 75.00 75.00 2 Norges Bank Investment Management (NBIM) 30-09-2018 1.97 7.76M +0.12M FII 13.42 13.84 13.01 12.10 10.19 3 Aditya Birla Sun Life AMC Limited 30-09-2018 1.83 7.21M +2.70M DII 3.30 3.09 3.85 4.70 6.24 4 Selvam (Selvi) 30-09-2018 1.78 7.02M 0.0 Others 8.28 8.07 8.14 8.20 8.57 5 Selvam (Shanmugamsundaram) 30-09-2018 1.74 6.86M 0.0 6 Baron Capital Management, Inc. 30-06-2018 1.12 4.43M +0.36M 7 L&T Investment Management Limited 30-09-2018 1.07 4.23M +0.20M 8 HSBC Global Asset Management (Hong Kong) Limited 30-06-2018 0.88 3.48M +0.07M 9 The Vanguard Group, Inc. 30-09-2018 0.74 2.91M +0.00M 10 Reliance Nippon Life Asset Management Limited 30-09-2018 0.61 2.41M +0.01M
Source: Reuters, ICICI Direct Research
Recent Activity es Buys Sells Investor name Value Shares Investor name Value Shares Aditya Birla Sun Life AMC Limited +22.90M +2.70M Goldman Sachs Asset Management International -16.03M -1.21M Kotak Mahindra Asset Management Company Ltd. +6.52M +0.60M Union Investment Luxembourg S.A. -7.25M -0.63M Pictet Asset Management Ltd. +6.39M +0.56M Sydinvest -5.89M -0.55M Baron Capital Management, Inc. +4.16M +0.36M Baroda Pioneer Asset Management Company Limited -1.79M -0.21M GAM International Management Ltd. +3.60M +0.33M Goldman Sachs Asset Management (India) Private Ltd. -2.81M -0.21M
Source: Reuters, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 8
Financial summary
Profit and loss statement | Crore Cash flow statement | Crore es (Year-end March) FY17 FY18 FY19E FY20E (Year-end March) FY17 FY18 FY19E FY20E Total operating Income 2,645.7 2,963.0 3,546.5 3,955.5 Profit after Tax 1,030.3 1,135.0 1,411.8 1,478.7
Growth (%) 7.3 12.0 19.7 11.5 Add: Depreciation 400.5 450.0 496.5 545.9
Raw Material Expenses 233.8 302.9 373.0 497.7 Add: Interest Paid 1.0 1.1 1.2 1.2 Employee Expenses 273.5 314.5 335.3 364.8 (Inc)/dec in Current Assets 211.6 (385.7) (225.7) (128.1) Other Expenses 368.6 341.9 421.2 465.3 Inc/(dec) in CL and Provisions 35.1 247.5 58.5 40.5 Total Operating Expenditure 875.9 959.3 1,129.5 1,327.8 Others 0.0 0.0 0.0 0.0 EBITDA 1,769.8 2,003.8 2,417.0 2,627.7 CF from operating activities 1,678.4 1,447.9 1,742.2 1,938.2 Growth (%) 5.8 13.2 20.6 8.7 (Inc)/dec in Investments -505.6 -1,032.1 -150.0 -150.0 Depreciation 400.5 450.0 496.5 545.9 (Inc)/dec in Fixed Assets -833.6 -364.6 -450.0 -450.0 Interest 1.0 1.1 1.2 1.2 Others 21.2 29.6 2.0 2.0 Other Income 153.8 142.3 185.1 152.0 CF from investing activities -1,318.0 -1,367.1 -598.0 -598.0 Exceptional Items - - - - Issue/(Buy back) of Equity 0.0 0.0 0.0 0.0 PBT 1,522.2 1,695.0 2,104.4 2,232.7 Inc/(dec) in loan funds 0.0 0.0 0.0 0.0 MI/PAT from associates 28.3 22.4 20.8 20.8 Dividend paid & dividend tax -470.5 -470.5 -470.5 -470.5 Total Tax 520.3 582.3 713.4 774.7 Interest Paid -1.0 -1.1 -1.2 -1.2 PAT 1,030.3 1,135.0 1,411.8 1,478.7 Others -5.3 -25.0 0.0 0.0 Growth (%) 14.5 10.2 24.4 4.7 CF from financing activities -476.9 -496.6 -471.7 -471.7 EPS (|) 26.1 28.8 35.8 37.5 Net Cash flow -116.5 -415.8 672.5 868.5 Opening Cash 904.9 788.4 372.6 1,045.1 Source: Company, ICICI Direct Research Closing Cash 788.4 372.6 1,045.1 1,913.6
Source: Company, ICICI Direct Research
Balance sheet | Crore Key ratios es (Year-end March) FY17 FY18 FY19E FY20E (Year-end March) FY17 FY18 FY19E FY20E Per share data (|) Liabilities Equity Capital 197.0 197.0 197.0 197.0 EPS 26.1 28.8 35.8 37.5
Preference Capital 93.4 93.4 93.4 93.4 Cash EPS 36.3 40.2 48.4 51.4 Reserve and Surplus 3,738.0 4,398.0 5,339.2 6,347.4 BV 102.2 119.0 142.9 168.4 Total Shareholders funds 4,028.5 4,688.4 5,629.7 6,637.9 DPS 11.9 11.9 0.0 0.0 Total Debt 0.0 0.0 0.0 0.0 Cash Per Share 20.0 9.5 26.5 48.6 Others 65.9 88.4 90.4 92.4 Operating Ratios (%) Total Liabilities 4,094.3 4,776.8 5,720.1 6,730.3 EBITDA Margin 66.9 67.6 68.2 66.4 PBT / Total Operating income 51.8 52.4 54.2 52.6 Assets PAT Margin 38.9 38.3 39.8 37.4 Gross Block 5,444.9 5,784.2 6,234.2 6,684.2 Inventory days 0.1 0.0 0.0 0.0 Less: Acc Depreciation 4,197.5 4,647.5 5,144.0 5,689.9 Debtor days 106.6 131.1 124.5 118.3 Net Block 1,247.4 1,136.7 1,090.2 994.3 Creditor days 31.9 35.2 35.2 35.2 Capital WIP 1.6 47.4 47.4 47.4 Return Ratios (%) Total Fixed Assets 1,249.1 1,184.1 1,137.5 1,041.7 RoE 25.6 24.2 25.1 22.3 Investments 602.6 664.9 714.9 764.9 RoCE 37.2 35.5 36.8 33.2 Liquid Investments 545.5 1,515.2 1,615.2 1,715.2 RoIC 51.0 56.0 65.3 69.7 Goodwill on Consolidation 4.8 4.8 4.8 4.8 Valuation Ratios (x) Inventory 0.9 0.3 0.3 0.3 P/E 24.1 21.8 17.6 16.8 EV / EBITDA 13.2 11.4 9.2 8.1 Debtors 772.6 1,063.9 1,209.8 1,281.8 EV / Net Sales 8.9 7.7 6.2 5.3 Loans and Advances 97.1 104.3 124.8 139.2 Market Cap / Sales 9.4 8.4 7.0 6.3 Other Current Assets 213.4 301.2 360.5 402.1 Price to Book Value 6.2 5.3 4.4 3.7 Cash 788.4 372.6 1,045.1 1,913.6 Total Current Assets 1,872.4 1,842.3 2,740.5 3,737.1 Solvency Ratios Debt/EBITDA 0.0 0.0 0.0 0.0 Creditors 231.3 285.5 341.7 381.2 Provisions 20.1 16.4 18.6 19.8 Debt / Equity 0.0 0.0 0.0 0.0
Net Current Assets 1,621.0 1,540.3 2,380.1 3,336.2 Current Ratio 4.3 2.9 3.0 3.1 Quick Ratio 4.3 2.9 3.0 3.0 Other Non Current Assets 71.4 64.4 64.4 64.4 Application of Funds 4,094.3 4,776.8 5,720.1 6,730.3 Source: Company, ICICI Direct Research
Source: Company, ICICI Direct Research .
ICICI Securities Ltd | Retail Equity Research Page 9 ICICI Direct Reseach coverage universe (Media) CMP M Cap EPS (|) P/E (x) EV/EBITDA (x) RoCE (%) RoE (%) Sector / Company (|)TP(|)Rating(| Cr) FY18 FY19E FY20E FY18 FY19E FY20E FY18 FY19E FY20E FY18 FY19E FY20E FY18 FY19E FY20E DB Corp (DBCORP) 167190 Buy 3,071 17.114.917.39.711.29.65.16.25.0 23.122.424.4 16.316.117.2 DISH TV (DISHTV) 4242 Hold 7,706 -0.4 0.92.0 NM 46.120.47.64.54.03.19.010.40.12.55.4 ENIL (ENTNET) 631780 Hold 3,0087.513.823.984.445.626.4 25.218.912.76.210.216.03.57.010.8 Inox Leisure (INOX) 224260 Buy 2,157 11.97.811.418.828.919.6 11.611.38.8 13.211.914.8 10.610.012.9 JagranPrakashan 110104 Hold 3,415 10.69.68.510.311.412.95.25.86.2 18.918.617.0 16.114.712.5 PVR(JAGPRA) (PVRLIM) 1,401 1,385 Hold 6,544 26.435.743.653.139.332.1 18.314.612.1 14.713.215.5 11.513.514.3 Sun TV (SUNTV) 629675 Hold 24,786 28.835.837.521.817.616.8 11.49.28.1 35.536.833.2 24.225.122.3 TV Today (TVTNET) 378445 Hold 2,257 19.925.829.719.014.612.89.97.96.1 30.430.329.6 19.319.618.9 ZEE Ent. (ZEEENT) 437540 Buy 41,974 15.415.720.028.427.921.9 18.815.512.8 25.624.525.5 15.314.716.0 Source: Company, ICICI Direct Research
ICICI Securities Ltd | Retail Equity Research Page 10 RATING RATIONALE ICICI Direct endeavours to provide objective opinions and recommendations. ICICI Direct assigns ratings to its stocks according to their notional target price vs. current market price and then categorises them as Strong Buy, Buy, Hold and Sell. The performance horizon is two years unless specified and the notional target price is defined as the analysts' valuation for a stock.
Strong Buy: >15%/20% for large caps/midcaps, respectively, with high conviction; Buy: >10%/15% for large caps/midcaps, respectively; Hold: Up to +/-10%; Sell: -10% or more;
Pankaj Pandey Head – Research [email protected]
ICICI Direct Research Desk, ICICI Securities Limited, 1st Floor, Akruti Trade Centre, Road No 7, MIDC, Andheri (East) Mumbai – 400 093 [email protected]
ICICI Securities Ltd | Retail Equity Research Page 11 ANALYST CERTIFICATION We /I, Bhupendra Tiwary MBA, Sameer Pardikar, MBA Research Analysts, authors and the names subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflect our views about the subject issuer(s) or securities. We also certify that no part of our compensation was, is, or will be directly or indirectly related to the specific recommendation(s) or view(s) in this report. Terms & conditions and other disclosures: ICICI Securities Limited (ICICI Securities) is a full-service, integrated investment banking and is, inter alia, engaged in the business of stock brokering and distribution of financial products. ICICI Securities Limited is a Sebi registered Research Analyst with Sebi Registration Number – INH000000990. ICICI Securities Limited Sebi Registration is INZ000183631 for stock Broker. ICICI Securities is a wholly-owned subsidiary of ICICI Bank which is India’s largest private sector bank and has its various subsidiaries engaged in businesses of housing finance, asset management, life insurance, general insurance, venture capital fund management, etc. (“associates”), the details in respect of which are available on www.icicibank.com.
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ICICI Securities or its associates might have managed or co-managed public offering of securities for the subject company or might have been mandated by the subject company for any other assignment in the past twelve months.
ICICI Securities or its associates might have received any compensation from the companies mentioned in the report during the period preceding twelve months from the date of this report for services in respect of managing or co-managing public offerings, corporate finance, investment banking or merchant banking, brokerage services or other advisory service in a merger or specific transaction.
ICICI Securities or its associates might have received any compensation for products or services other than investment banking or merchant banking or brokerage services from the companies mentioned in the report in the past twelve months.
ICICI Securities encourages independence in research report preparation and strives to minimize conflict in preparation of research report. ICICI Securities or its associates or its analysts did not receive any compensation or other benefits from the companies mentioned in the report or third party in connection with preparation of the research report. Accordingly, neither ICICI Securities nor Research Analysts and their relatives have any material conflict of interest at the time of publication of this report.
It is confirmed that Bhupendra Tiwary MBA, Sameer Pardikar, MBA, Research Analysts of this report have not received any compensation from the companies mentioned in the report in the preceding twelve months.
Compensation of our Research Analysts is not based on any specific merchant banking, investment banking or brokerage service transactions.
ICICI Securities or its subsidiaries collectively or Research Analysts or their relatives do not own 1% or more of the equity securities of the Company mentioned in the report as of the last day of the month preceding the publication of the research report.
Since associates of ICICI Securities are engaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject company/companies mentioned in this report.
It is confirmed that Bhupendra Tiwary MBA, Sameer Pardikar, MBA, Research Analysts do not serve as an officer, director or employee of the companies mentioned in the report.
ICICI Securities may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.
Neither the Research Analysts nor ICICI Securities have been engaged in market making activity for the companies mentioned in the report.
We submit that no material disciplinary action has been taken on ICICI Securities by any Regulatory Authority impacting Equity Research Analysis activities.
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