Vikash Mantri, Media Analyst at I-Sec in an interview to CNBC-TV18 said that the revised guidelines for owning news and non news channel are still not very clear so it would be difficult to quantify its impact on media stocks.
From the media pack, Mantri is positive on Sun TV and Dish TV. "We are looking for a significant upside in Sun TV from current levels. The stock has corrected significantly in the last few months because the risks are more political in nature and is not directly linked to the company per se. But I would still buy this stock for the assets it owns in Karnataka and Andhra Pradesh," he said. I-Sec has target price of around Rs 85 for Dish TV. "We continue to be structurally positive but are not as positive on the earnings upgrades which have been build in the recent past," he added. Tulsian's multibaggers: Cash on GIC Housing & ACG Below is the edited transcript of Mantri's interview with CNBC-TV18. Also watch the accompanying video. Q: Can you give us assessment of these revised guidelines that came in? How material is this at this point in time and what stocks would be affected? A: The detail are not yet very clear and it will affect this space. Starting news channel was relatively very easy with very low capital, this will now ensure that only serious players with long-term operate in the news space. It is very difficult to comment who will be impacted. But in a way it is good thing because we have slew of news channels in our country and relatively very small entities per se. Q: Any impact on existing players though in terms of how they will have to shore up their net worth whether they will have to take on more leverage in order to increase their equity base? How will it work? A: It will be difficult to ask the current players who relatively do not have very high net worth to match up their net worth as a directive. It is very difficult to ensure that this will happen. It would be true for new channels rather than existing set of channels. Q: One of your top picks is Sun TV what makes you positive on that stock and what kind of price target do you have on it? A: We are looking for a significant upside from current levels. The stock has corrected significantly in the last few months because the risks are more political in nature and is not directly linked to the company per se. We believe Sun TV sits on very good assets in the southern market. One of the markets might be at risk due to the uncertainty at the ground level in terms of distribution, analysts or investors are not very comfortable with the political risk that they are associated. Other than that the Andhra and Karnataka market is devoid of any such risk. I would buy this stock at these levels only for presence in these two markets. Forget their strong presence in Tamil Nadu which will continue. However this stock continues to be troubled because of other risks that are associated. Investors are not very comfortable taking in those risks. A similar situation was seen in 2008 and then things turned positive for Sun TV where the risk did not materialise. We continue to have a very positive outlook on Sun TV. Some risks which are political in nature are not very quantifiable. But I would still buy Sun TV for the assets it owns in Karnataka and Andhra Pradesh. Q: On the downside what are the issues thatDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
