Buy Sun TV Network; target of Rs 500: Motilal Oswal

Motilal Oswal 's research report on Sun TV Network

Sun TV Network (SUNTV)’s revenue fell by 45% YoY, weighed by a plunge in ad revenues and the absence of an IPL season, but partly cushioned by subscription revenue growth. EBITDA fell 39%, partly offset by no fresh content production cost and SG&A cost rationalization. We revise our FY21/FY22E EBITDA by 9%/8% as we factor IPL earnings in FY21E, better subscription revenues, and the benefit of sharp cost rationalization.

Outlook

We value Sun TV at FY22E P/E of 12x on account of: a) a muted ad spend outlook in the economy and b) the looming threat to subscription revenues from NTO 2.0. Thus, we arrive at target price of INR500. Maintain Buy.

For all recommendations report, click here

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Read More