Buy HT Media; target of Rs 200: Unicon Investment

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Buy HT Media; target of Rs 200: Unicon Investment

Unicon Investment is bullish on HT Media and has recommended buy rating on the stock with a target of Rs 200 in its July 23, 2011 research report.

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Unicon Investment is bullish on HT Media and has recommended buy rating on the stock with a target of Rs 200 in its July 23, 2011 research report.

"HT Media Ltd Q1FY12 numbers were broadly in line with our estimates, with revenue registering a ~23% growth YoY from INR 4.1 bn to INR 5 bn. EBITDA witnessed a growth of ~12% YoY to INR 903 mn from INR 808 mn. The EBITDA margins registered a decline of 177 bps due to the higher newsprint prices and increase print order. However, the company registered a growth of ~24% YoY in PAT from INR 414 mn to INR 515 mn due to increase in other income and lower tax rate."

"The advertising revenue registered a growth of ~17% on YoY basis, from INR 3289 mn to INR 3844 mn primarily driven by advertising yield improvements. English ad revenue grew ~18% YoY to INR 1.1 bn, the growth in the English market was driven by the growth in Mumbai market which registered a growth of ~35%. Hindi registered a growth of 15% to INR 1108 mn from INR 963 mn. On circulation front, the company registers an increase of 3%YoY to INR 485 mn from INR 468 mn driven by following circulation. Radio & Entertainment segment resisted 75% increase in revenue to INR. 215 mn from INR. 123 mn with EBIT of INR 34 mn. HT Burda printing revenue is at INR 245 mn for Q1FYfrom INR 24 mn and achieved EBITDA breakeven as compared to loss of INR 13 mn. Digital segment revenues registered a growth of ~39% YoY from INR 62 mn to INR 86 mn. Raw material cost increase by 32% YoY, which was 35% of the revenue from 33%, given due to high newsprint price and increase in print order."

"HTML posted better than expected Q1FY12 result. Going forward, management has guided a muted ad growth for near term, with interest rate sensitive sectors like real estate and financials cutting down on ad spending. Moreover, company is cross selling advertising inventory across division which is expected to give better utilization levels. At CMP the stock trades at PE multiple of 17.6x and 14x for FY12E and FY13E earning respectively. We maintain BUY on the stock with the target price of INR 200," says Unicon Investment research report.

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To read the full report click on the attachment