Hold Sun TV Network: target of Rs 570: ICICI Direct
ICICI Direct recommended hold rating on Sun TV Network with a target price of Rs 570 in its research report dated February 09, 2021.
February 10, 2021 / 06:52 PM IST
ICICI Direct's research report on Sun TV Network
Sun TV’s Q3FY21 numbers were mixed as ad recovery was slower and subscription growth was lower than expected but lower amortisation aided PAT. Revenue (standalone) was at Rs 972.3 crore, up 19.3% YoY boosted by IPL revenue. Ex-IPL revenue was at Rs 763.3 crore, down 6.3% YoY. Ad revenues at Rs 309 crore were down 9.4% YoY as ad spend by retail is yet to pick up. Subscription revenues were up ~3% YoY to Rs 424 crore. EBITDA was at Rs 600.7 crore, up 3.5% YoY while EBITDA margin at 61.8% was down 944 bps YoY. Margins (Ex-IPL) were 67.2%, down 400 bps YoY. Amortisation expenses were lower due to fewer movie premieres on TV. Consequently, PAT was at Rs 441.8 crore, up 18.3% YoY.
We value Sun TV at 13x FY23E EPS (same as Zee) to arrive at revised target price of Rs 570 (vs. earlier TP: Rs 480).
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