Buy DB Corp; target of Rs 103: ICICI Securities
ICICI Securities is bullish on DB Corp has recommended buy rating on the stock with a target price of Rs 103 in its research report dated June 24, 2020.
June 25, 2020 / 07:43 AM IST
ICICI Securities research report on DB Corp
DB Corp’s (DBCL) Q4FY20 advertisement revenue dip of 20.1% YoY was weak, but outperformed peers. However, the company’s EBITDA dip was cushioned from lower newsprint prices and pagination. It expects cost saving of Rs1-1.2bn in FY21 to aid in protecting large EBITDA slip. DBCL remains hopeful on return of readers and advertisers, but we see imminent risk to advertisement revenue from digital. Lower circulation losses could aid earnings, but we do not see industry moving towards it. Dividend distribution policy unchanged at 65% payout. Promoters have cut debt to Rs1.6bn from Rs3bn, but pledge shares remain high on lower stock price. Promoters committed to reduce debt to nil, and revoke complete pledged shares.
We have cut our EPS estimates by 23.3% / 3.4% for FY21/FY22, respectively, and target price to Rs103 (from Rs107). Reiterate BUY.
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