Outlook and stock returns
On NSE, the current market price (CMP) of TV Today Network is Rs 279.65 each. The stock is trading at Rs 44.1 above the 52-week low and Rs 180.45 below the stock’s 52-week high, respectively.
The stock’s 52-week low is Rs 235.55 each recorded on May 25, 2022, and the 52-week high is Rs 460.10 each recorded on December 14, 2021.
Over the week, the company’s shares have fallen around 0.23% and gained 4.39% over the past month, respectively. Over the past year, stocks have fallen about 2.73%. Over the past 3 years, stocks have fallen 9.12%, while over the past 5 years, stocks have gained 12.9%.
The stock’s ROE is 15.67%. TTM EPS is 30.04. The TTM PE ratio is 9.31. The P/B ratio is 1.45%. The dividend yield is 1.07% and the face value is Rs 5.
If an investor buys the shares of the company at the current market price, he can expect a potential gain of 26%, considering the target price estimated by the brokerage firm.
According to ICICI Direct Research, TV Today’s performance was weak.
Topline came in at Rs 218.2 crore, up 7% with revenue from TV and other media (pushed broadcast and digital segment) at Rs 214.6 crore (up 7% YoY annual). While TV broadcasting revenue would have been reduced year-over-year due to lower ad inventory, growth would have been driven by the digital segment (~30%+ growth by our calculations).
Reported EBITDA came in at Rs 47.3 crore, down 9.6% YoY with EBITDA margins at 21.7% (down 399 bps YoY), impacted by the increase in labor costs (up 27% year-on-year) driven by the anticipated cost burden for the expansion of the digital segment.
PAT reported at Rs 35.1 crore was down 6.1% year-on-year with lower margins weighing on bottom line.
Buy for a target price of Rs 350 each
TV Today’s stock price has underperformed with a stock price return of only ~16% over the past five years. “We are maintaining BUY as we believe that with stable double-digit growth, a healthy yield ratio and current valuations, this provides a margin of safety. Any announcement of cash uses such as the acquisition of dividends/ of digital assets (which the company is considering) will also be a key trigger. We value TV Today at Rs 350 i.e. 10x FY24E P/E,” the brokerage said.