Neutral Sun TV Network; target of Rs 630: Motilal Oswal

Motilal Oswal's research report on Sun TV Network

Sun TV Network (SUNTV) reported a weak 2QFY26, with ad revenue declining 13% YoY amid weak consumer sentiment and cut back in ad spends by FMCG players on linear TV. Reported revenue was boosted by a strong performance at the box-office from SUNTV ’s movie, Coolie. However, higher amortization costs and operating deleverage led to a sharp ~28% miss on EBIT (up by a modest 3% YoY) and adj. PAT (down 10% YoY).

Outlook

We value SUNTV on an SoTP basis: 10x Dec’27 EV/sales for SRH, ~5x EV/EBITDA for the core TV business, 0.5x investments for Northern Superchargers, and 1x for cash/dividends (~INR 78b), for our revised TP of INR630 (implies ~14x Dec’27E P/E). We reiterate our Neutral rating.