Entertainment Network an outperformer: Prabhudas Lilladher

Prabhudas Lilladher has maintained its outperformer rating on Entertainment Network India with a target price of Rs 523 in its May 15, 2008 research report. "Entertainment Network India (ENIL) reported its Q4FY08 results, largely in line with our expectations. Consolidated revenue for the quarter declined by 8.8% QoQ to Rs 1,233 million. Consequently, net profit for the quarter declined sequentially by 14% at Rs 36 million."

"Going ahead, we expect the radio segment to be a cash cow for the company, as it enjoys steady margins (32-35% by FY10), besides bringing in synergies to the promising out-of-home (OOH) business. Also, where the recent private equity infusion in Times OOH has helped the company deleverage and fund expansion; it has also set a benchmark valuation for the subsidiary. Our sum-of-the-parts valuation of the company comes to Rs 523 per share, valuing the radio business at Rs 359 per share and its subsidiaries at Rs 164 per share.  We maintain our Outperformer rating on the stock," says Lilladher's research report.

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