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Hold Saregama India; Target Of Rs 680: ICICI Direct

ICICI Direct recommended hold rating on Saregama India with a target price of Rs 680 in its research report dated October 30, 2020.

Nov 4, 2020 / 12:55 PM IST
 
 
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ICICI Direct's research report on Saregama India


Saregama India's revenues for Q2FY21 fell 31.3% YoY to Rs 108.1 crore as Carvaan sales declined to 81,000 units vs. 250,000 in Q2FY20. EBITDA, however, was at Rs 36.9 crore, up 52.3% YoY, due to lower promotion costs (high marketing expense in base quarter) and contract manufacturing charges with a healthy EBITDA margins at 34.1%. Consequently, PAT came in at Rs 28.2 crore.


Outlook


However, subdued Carvaan sales and delay in its ramp up will limit overall growth. We will track the strategy of converting Carvaan into a platform and its monetisation. New music acquisition spends will also be a key monitorable. We maintain HOLD rating with a revised target price of Rs 680/share at13x FY22 P/E.


For all recommendations report, click here


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first published: Nov 4, 2020 12:55 pm

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