January 23, 2017 / 15:27 IST
DB Corp’s (DBCL) Q3FY17 revenue and EBITDA came in line. Key positives, despite the demonetisation impact, were: (i) robust radio ad growth of 12.4% YoY on a high base of 25.7% YoY; and (ii) circulation revenue rose 8.9% YoY on a base of 17.8% YoY. Key negative was disappointing print ad growth of 2.4% due to double digit ad volumes loss in November and December on a favourable base of 0.6% YoY dip. HMVL reported 7% YoY fall in print ad revenue.
Outlook
DBCL remains one of the best plays in the print space. The company is ramping up in the digital domain as well. Though print ad growth is envisaged to gain from GDP revival and cut in interest rates, it has been volatile and will remain the key monitorable. With consumption recovering post demonetisation, we expect ad volumes to revive as well. We roll forward to FY19E EPS and maintain ’BUY/SO’ with a revised TP of INR 473 (INR 476 earlier). At CMP, the stock trades at 14.7x and 12.8x FY18E and FY19E EPS, respectively.
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