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CMP: INR531
TP: INR620 (+17% )
Buy
Sharp cost savings in a weak environment aid earnings
Sun TV Network
12 June 2021
4QFY21 Results Update | Sector: Media
Bloomberg
Equity Shares (m)
M.Cap.(INRb)/(USDb)
52-Week Range (INR)
1, 6, 12 Rel. Per (%)
12M Avg Val (INR M)
SUNTV IN
394
209.2 / 2.9
571 / 368
-4/-1/-18
1440
Sun TV Network (SUNTV)’s EBITDA, up 9% YoY, was largely in-line as costs
were kept in check in a modest revenue growth environment. The dividend
payout fell sharply to just INR5/share, the lowest since FY10 (v/s
INR25/share in FY20), despite strong cash reserves.
Given the impact of the second COVID wave, we cut our FY22E EBITDA/PAT
estimates by 9%/6%, but maintain our FY23E estimates. We see the
delayed investment in OTT as a key risk that could dilute its competitive
position. However, viewership improvement in linear TV and low valuations
offer support. Maintain Buy.
SUNTV’s 4QY21 revenues increased 6% YoY to INR7.8b (in-line), with
subscription revenue up 7% YoY to INR4.3b. Advertisement revenues grew
8% YoY.
Production costs were up 23% YoY on the low base of 4QFY20. However,
tight cost measures in employee/SG&A (down 8%/17%) kept the overall
operating cost flattish (up just 1.5%).
EBITDA subsequently improved 9% YoY to INR5.5b (in-line); EBITDA margins
stood at 69.9% (up 140bps YoY).
Net profits were flattish (up 2% YoY) at INR4.5b (6% above estimate) on
account of lower-than-expected tax, partly offset by higher depreciation
and interest cost.
Ad revenue growth is expected to recover by 2QFY22 and double-digit
subscription revenue growth is estimated in FY22.
It is estimated to invest a total of INR10–12b in movie production over the
next two years, with some big-ticket projects and 6–8 fiction shows lined up
for release as the market opens up.
Capex of INR2–2.5b is commissioned for FY22 towards procuring satellite
rights.
The company is not planning aggressive movie acquisitions for OTTs, like
other players, which have borne the brunt of sub-optimal returns.
Subscription revenue is expected to grow in the double digits in FY22E, led
by digitization trends, along with a rise in OTT subscriptions. Viewership
trends are yet to see a steady uptick.
Plans to launch new TV shows / movies and a Marathi channel in FY22 have
been delayed given the second COVID wave. However, the most concerning
factor is the delayed OTT investment – besides monetizing the existing
library, the company has not made any material inroads in the space.
Furthermore, it has curbed the dividend payout to just INR5/share, the
lowest since FY10.
Ads and subscriptions grow prior to second wave impact
Financials & Valuations (INR b)
INRb
FY21 FY22E FY23E
Sales
EBITDA
Adj. PAT
EBITDA Margin (%)
Adj. EPS (INR)
EPS Gr. (%)
BV/Sh. (INR)
Ratios
Net D:E
RoE (%)
RoCE (%)
Payout (%)
Valuations
P/E (x)
P/B (x)
EV/EBITDA (x)
Div . Yield (%)
FCF Yield (%)
31.2
20.7
15.2
66.3
38.6
10.8
176.3
-0.7
24.2
24.5
15.0
13.8
3.0
8.2
0.9
7.1
34.2
22.8
14.8
66.7
37.6
-2.5
185.1
-0.8
20.8
20.9
76.8
14.1
2.9
8.4
4.7
9.8
38.5
25.3
16.3
65.6
41.4
10.0
197.6
-0.8
21.6
21.7
69.8
12.9
2.7
6.1
4.7
9.4
Highlights from management commentary
Valuation and view
Shareholding pattern (%)
As On
Mar-21
Dec-20
Promoter 75.0
75.0
DII
4.1
5.0
FII
9.0
9.4
Others
12.0
10.5
FII Includes depository receipts
Mar-20
75.0
7.2
9.0
8.8
Research Analyst: Aliasgar Shakir
(Aliasgar.Shakir@motilaloswal.com)
Research Analyst: Suhel Shaikh
(Suhel.Ahmad@MotilalOswal.com)
Motilal Oswal research is available on www.motilaloswal.com/Institutional-Equities, Bloomberg, Thomson Reuters, Factset and S&P Capital.
Investors are advised to refer through important disclosures made at the last page of the Research Report.
 Motilal Oswal Financial Services
Sun TV Network
Sun TV’s healthy liquidity, with INR 8.8b net cash in FY21, offers room to
intensify investments in the linear as well as OTT space. This, along with high
dividend payout potential and low valuations, offers support.
We revise our FY22E EBITDA/PAT estimates by 9%/6%, weighed by the impact of
the second wave. However, we maintain our FY23E estimates, building growth
of 13%/19% over FY20.
Sun TV trades at FY22E/FY23E P/E of 14.1x/12.9x. We value the stock at FY23E
P/E of 15x to arrive at Target Price of INR620. Maintain Buy.
(INR Million)
FY21E Est Var
4Q
(%)
8,122
-4
10.5
2,514
-6
5,609
-3
11.4
-25
475
61
30
475
577
-12
5,681
-11
1,429
25.2
4,252
6
60.4
Standalone - Quarterly Earnings Model
Y/E March
Revenue
YoY Change (%)
Total Expenditure
EBITDA
YoY Change (%)
Depreciation
Interest
Other Income
PBT
Tax
Rate (%)
Reported PAT
YoY Change (%)
E: MOFSL Estimates
Key Performance Indicators
Y/E March
Revenue Breakup
Advertising
Broadcasting
Total Advertising & Broadcasting
International subscription
Domestic Subscription
- Domestic Cable
- DTH
Total Subscription revenue
Films, IPL and Others
Total
Production Costs (%)
EBITDA Margin (%)
EBIT Margins (%)
PAT Margins (%)
E: MOFSL Estimates
1Q
10,804
-3.6
3,975
6,829
-7.1
1,585
21
567
5,791
1,972
34.1
3,819
-6.7
2Q
7,739
3.3
3,052
4,687
-15.4
1,444
20
721
3,945
280
7.1
3,665
4.3
FY20
3Q
8,150
-9.9
2,346
5,804
-13.0
1,436
19
636
4,985
1,250
25.1
3,735
6.3
4Q
7,352
-17.3
2,317
5,035
-17.2
2,328
19
570
3,259
759
23.3
2,500
-11.7
1Q
6,061
-43.9
1,896
4,165
-39.0
1,455
18
1,086
3,779
951
25.2
2,828
-25.9
2Q
7,562
-2.3
2,541
5,020
7.1
913
16
516
4,607
1,148
24.9
3,459
-5.6
FY21
3Q
9,723
19.3
3,717
6,007
3.5
687
15
621
5,926
1,508
25.4
4,418
18.3
4Q
7,820
6.4
2,352
5,468
8.6
766
172
506
5,036
537
10.7
4,499
80.0
FY20
34,044
-7.1
11,684
22,361
-12.8
6,793
78
2,489
17,979
4,261
23.7
13,718
-1.7
FY21
31,166
-8.5
10,506
20,660
-7.6
3,821
220
2,729
19,348
4,144
21.4
15,204
10.8
1Q
3,682
100
3,782
410
3,969
1,690
2,280
4,379
2,643
10,804
13
63.2
53.8
35.3
2Q
FY20
3Q
3,410
50
3,460
410
4,119
2,050
2,070
4,529
161
8,150
14
71.2
61.4
45.8
4Q
2,910
40
2,950
410
3,988
1,930
2,050
4,398
8
7,356
13
68.5
44.6
34.0
1Q
1,256
4
1,260
378
4,423
2,260
2,160
4,801
1
6,061
11
68.7
62.6
46.7
2Q
FY21
3Q
3,090
16
3,106
290
4,241
2,000
2,241
4,531
2,102
9,739
13
61.8
61.1
45.4
4Q
3,149
40
3,189
360
4,281
2,100
2,180
4,641
-26
7,804
14
69.9
66.6
57.5
FY20
13,369
270
13,639
1,640
15,622
7,350
8,690
17,262
2,719
33,620
16
65.7
53.0
40.3
FY21
9,940
65
10,005
1,398
17,215
8,310
8,901
18,613
2,548
31,166
13
66.3
62.8
48.8
3,370
80
3,450
410
3,973
1,680
2,290
4,383
-94
7,739
20
60.6
51.2
47.4
2,446
4
2,450
370
4,270
1,950
2,320
4,640
471
7,562
13
66.4
61.1
45.7
Segmental revenues and other highlights
Total ad revenues were up 8.2% YoY to INR3.1b. The company expects revenues
within this segment to pick up from 2QFY22.
Total subscription revenues increased 7.4% to INR4.3b. The company has guided
for double-digit growth in this segment going ahead.
International subscription revenues were down 12.2% YoY to INR360m.
12 June 2021
2
 Motilal Oswal Financial Services
Sun TV Network
Exhibit 1: Valuation based on FY23E EPS
Particulars
EPS (INR)
PE multiple (x)
Target Price (INR)
CMP (INR)
Upside (%)
INR
41.4
15.0
620
532
16.7%
Source: Company, MOFSL
4QFY21 earnings call notes
Key highlights
Ad revenue growth is expected to recover by 2QFY21 and double-digit
subscription revenue growth is estimated in FY22.
It is estimated to invest a total of INR10–12b in movie production over the next
two years, with some big-ticket projects and 6–8 fiction shows lined up for
release as the market opens up.
Capex of INR2–2.5b is commissioned for FY22 toward procuring satellite rights.
The company is not planning aggressive movie acquisitions for OTTs, like other
players, which have borne the brunt of sub-optimal returns.
Vivaad se Vishwaas: The company settled a tax liability dispute that was part of
an INR9.5b contingent liability via an ~INR2.50b payment. This resulted in DTA
creation of INR4.11b during the quarter.
Dividends: The company did not declare any dividends in 4Q on the expectation
of volatility in the business segments and the likelihood of a third COVID wave.
The total dividend during the year remained at INR5/share.
Decline in depreciation/amortization cost: The sharp decline in depreciation cost
on a YoY basis was largely attributable to the conversion of satellite rights being
impacted by fewer movie releases.
One-time interest cost: The company recognized interest on tax provisions,
pertaining to the period of FY17–18 to FY19–20, amounting to INR156m.
Segmental revenue: Segmental revenue for 4QFY21 / the full year was as
follows:
Advertisements: INR 3.15b/ INR 9.9b
Broadcast: INR 20m/ INR 40m
International: INR 0.4b / INR 1.4b
Paychannel: INR 2.1b/ INR 8.3b
DTH: INR 2.2b / INR 8.9b
Business performance
Business outlook
Movie production:
The company has two big-ticket movies that are WIP, in
addition to other projects – the total investment ranges from ~INR10b to
INR12b over a two-year period. Furthermore, the company has 6–8 fiction
shows lined up for release depending on the opening up of the markets.
Capex:
The company expects capex of INR2–2.5b for FY22 towards procuring
satellite rights.
Ad revenues:
Despite good traction in ad revenues, coupled with better
utilization in January/February, March saw a limited impact of the second wave
3
12 June 2021
 Motilal Oswal Financial Services
Sun TV Network
on revenues. The company expects revenues within these segments to pick up
from 2QFY22.
Subscription revenues:
The company expects double-digit revenue growth
within this segment in the coming year.
Production cost:
The company expects the cost for fiction shows to go up by
30–40%, aimed at improving the quality of the content. Furthermore, it plans to
invest up to INR0.2b–0.3b per show in the “Impact Non-Fiction” category, which
would be launched in the Malayalam and Telugu markets.
Market share:
The company’s market share has improved 4–5% in the
“Primetime Fiction” category in the last three quarters. The company expects to
further strengthen its share in Tamil primetime fiction as the market opens up
post the pandemic.
Sun NXT:
The company has seen a rise in monthly active users – nearly 40–50%
growth has been seen in the last six months. It further plans not to pay for any
expensive rights and remains prudent about its selection process.
OTT originals:
The company plans to invest in this segment in the coming
quarters on account of ongoing dislocations in this space.
4QFY20
7,352
2,317
5,035
68.5
2,328
2,707
19
570
3,259
759
23.3
2,500
2,500
4QFY20
2,910
40
2,950
410
3,988
1,930
2,050
4,398
8
7,356
3QFY21
9,723
3,717
6,007
61.8
687
5,320
15
621
5,926
1,508
25.4
4,418
4,418
3QFY21
3,090
16
3,106
290
4,241
2,000
2,241
4,531
2,102
9,739
4QFY21
7,820
2,352
5,468
69.9
766
4,702
172
506
5,036
537
10.7
4,499
4,499
4QFY21
3,240
2
3,242
336
4,277
2,100
2,180
4,613
-51
7,805
YoY%
6.4
1.5
8.6
143bps
-67.1
73.7
823.7
-11.3
54.5
-29.2
-1261bps
80.0
80.0
YoY%
11.4
-95.0
9.9
-18.0
7.3
8.8
6.3
4.9
-704.8
6.1
QoQ%
-19.6
-36.7
-9.0
815bps
11.5
-11.6
1,076.7
-18.5
-15.0
-64.4
-1478bps
1.8
1.8
QoQ%
4.9
-87.5
4.4
15.9
0.9
5.0
-2.7
1.8
-102.4
-19.9
4QFY21E
8,122
2,514
5,609
69.1
475
5,134
30
577
5,681
1,429
25.2
4,252
4,252
4QFY21E
2,926
87
3,012
454
4,423
2,022
2,404
4,878
232
8,122
v/s est (%)
-3.7
-6.4
-2.5
87bps
61.5
-8.4
474.6
-12.4
-11.4
-62.4
-1450bps
5.8
5.8
v/s est (%)
10.8
-97.7
7.6
-26.1
-3.3
3.9
-9.3
-5.4
NM
-3.9
Exhibit 2: Quarterly Performance (INR m)
INR m
Revenue
Operating expenditure
EBITDA
EBITDA margin (%)
Depreciation & amortization
EBIT
Interest
Other income
PBT
Tax
Effective tax rate (%)
PAT
Adjusted PAT
Revenue Breakup
Advertising
Broadcasting
Total Advertising & Broadcasting
International subscription
Domestic Subscription
- Domestic Cable
- DTH
Total Subscription revenue
Films, IPL and Others
Total
Source: MOFSL, Company
Exhibit 3: Operating expense breakup (INR m)
Operating Cost
Production cost
Employee cost
Other exp
Total Operating expenses
4QFY20
922
731
663
2,317
3QFY21
1224
673
1820
3,717
4QFY21
1,134
670
549
2,352
YoY%
23.0
-8.4
-17.3
1.5
QoQ%
-7.4
-0.4
-69.9
-36.7
4QFY21E
1,060
724
730
2,514
v/s est (%)
6.9
-7.4
-24.8
-6.4
Source: MOFSL, Company
12 June 2021
4
 Motilal Oswal Financial Services
Sun TV Network
Exhibit 4: Estimate change summary
Advst Revenue (INR b)
Old
Actual/New
Change (%)
Subscription Revenue (INR b)
Old
Actual/New
Change (%)
Revenue (INR b)
Old
Actual/New
Change (%)
EBITDA (INR b)
Old
Actual/New
Change (%)
EBITDA margin (%)
Old
Actual/New
Change (bp)
PAT (INR b)
Old
Actual/New
Change (%)
EPS (INR)
Old
Actual/New
Change (%)
FY21
9.8
10.1
2.3
18.8
18.6
-1.4
31.7
31.2
-1.8
21.1
20.7
-1.8
66.4
66.3
-3.6
15.2
15.2
0.0
38.6
38.6
0.0
FY22E
12.2
12.5
2.5
20.6
20.3
-1.4
37.0
37.0
0.1
24.9
24.9
0.0
67.4
67.3
-7.5
15.8
15.8
0.0
40.0
40.0
0.0
FY23E
13.5
13.8
2.5
22.1
21.8
-1.3
39.7
39.8
0.1
25.2
25.4
0.8
63.3
63.8
46.0
15.8
15.9
1.0
40.0
40.5
1.0
Source: MOFSL, Company
Exhibit 5: Sun TV stands first in Tamil genre (weekly)
Exhibit 6: Gemini TV stands fourth in Telugu genre (weekly)
Source: BARC, MOFSL
Source: BARC, MOFSL
Exhibit 7: Surya TV slips to fifth in Malayalam genre (weekly)
Asianet
Surya TV
Flowers TV
Mazhavil Manorama
60%
45%
30%
15%
0%
2018
2019
2020
2021
Exhibit 8: Udaya TV slips to fourth in Kannada genre
(weekly)
Source: BARC, MOFSL
12 June 2021
Source: BARC, MOFSL
5
 Motilal Oswal Financial Services
Sun TV Network
Story in charts
Exhibit 9: Standalone revenue up 6% YoY
Revenue (INR b)
EBITDA margin (%)
Source: MOFSL, Company
Exhibit 10: Trend in revenue mix (%)
12.0
7.0
2.0
-3.0
Ad & Broadcast
International sub
Domestic Cable
DTH
Films and others
Source: MOFSL, Company
Exhibit 11: Ad revenue trend
Advertising revenue (INR b)
16 16
2 -6 -3 3
-7 -7 -4
7
22 26 20
3
13
YoY growth (%)
0 2 -1
-11
-14
-9
-27
8
Exhibit 12: Broadcasting revenue trend
Broadcast revenue (INR b)
7
6
-8 -7 -7-14 -15-8 0
YoY growth (%)
0
-66
-13 -20 -10
-27 -21 -23 -32
-50
-53
-72 -69
-96
-95
-68
Source: MOFSL, Company
Source: MOFSL, Company
12 June 2021
6
 Motilal Oswal Financial Services
Sun TV Network
Exhibit 13: Cable revenue trend
Cable revenues (INR b)
49
27
4
28 24
21
YoY growth (%)
69 74
40
53
34
16
-2
9
9 8
Exhibit 14: DTH revenue trend
DTH revenues (INR b)
13 16 14 15
11 10 10
15 12
20 21 19
24
YoY growth (%)
37
13 17
0 5
18
29
17
30
39
8
-5
4
-11
6
-5
1
8 6
Source: MOFSL, Company
Source: MOFSL, Company
Exhibit 15: SUNTV: Snapshot (INR b)
INR b
Ad revenue (INR b)
YoY growth (%)
Broadcast revenue (INR b)
YoY growth (%)
Ad and broadcast revenue (INR b)
YoY growth (%)
DTH revenue (INR b)
YoY growth (%)
Cable revenue (INR b)
YoY growth (%)
International revenue (INRb)
YoY growth (%)
Total Subscription revenue (INR b)
YoY growth (%)
Films, IPL and other revenue (INR b)
YoY (%)
Total Revenue (INR b)
YoY (%)
EBITDA
YoY (%)
EBITDA margin (%)
Revenue mix (%)
Ad and broadcast revenue
Subscription revenue
DTH
Cable
International revenue
Films, IPL and other revenue
Domestic revenue
International revenue
FY16
12.1
7
1.1
-3
13.2
6
5.9
11
2.3
8
1.4
2
9.6
9
1.2
0
24.0
7
17.0
5
70.8
55
40
24
10
6
5
85
15
FY17
11.7
-3
1.0
-8
12.7
-4
6.6
12
2.9
25
1.7
23
11.2
17
1.7
45
25.6
7
17.4
2
67.9
50
44
26
11
7
7
85
15
FY18
13.1
12
0.9
-16
14.0
10
7.5
14
3.9
36
1.7
-3
13.1
17
1.6
-7
28.6
12
19.6
13
68.5
49
46
26
14
6
6
87
13
FY19
14.3
9
0.7
-13
15.0
8
8.6
14
4.6
19
1.8
7
15.0
15
6.6
318
36.6
28
25.6
31
70.0
41
41
23
13
5
18
88
12
FY20
13.4
-6
0.3
-64
13.6
-9
8.7
1
7.4
58
1.6
-8
17.3
15
2.7
-59
34.0
-7
22.4
-13
65.7
40
51
26
22
5
8
93
7
FY21E
9.9
-26
0.1
-56
10.1
-26
8.9
2
8.3
13
1.4
-16
18.6
8
2.5
-7
31.2
-8
20.7
-8
66.3
32
60
29
27
4
8
93
7
FY22E
12.4
25
0.1
5
12.5
25
9.8
10
9.1
10
1.4
0
20.3
9
4.2
65
37.0
19
24.9
20
67.3
34
55
26
25
4
11
93
7
FY23E
13.7
10
0.1
5
13.8
10
10.6
8
9.9
8
1.4
0
21.8
7
4.2
0
39.8
7
25.4
2
63.8
35
55
27
25
3
10
94
6
Source: MOFSL, Company
12 June 2021
7
 Motilal Oswal Financial Services
Sun TV Network
Financials and valuations
Standalone - Income Statement
Y/E March
Total Income from Operations
Change (%)
Production Costs
Employees Cost
Other Expenses
Total Expenditure
% of Sales
EBITDA
Margin (%)
Depreciation
EBIT
Int. and Finance Charges
Other Income
PBT bef. EO Exp.
EO Items
PBT after EO Exp.
Total Tax
Tax Rate (%)
Reported PAT
Adjusted PAT
Change (%)
Margin (%)
Adj EPS
No of Shares (mn)
Equity Dividend
Preference Dividend
Corporate Dividend Tax
Corp Div Tax (%)
Dividend per Share
Total Div Payout (Rs m)
Payout (%)
FY16
23,952
6.8
1,815
2,359
2,818
6,992
29.2
16,961
70.8
4,850
12,110
22
1,075
13,164
180
13,344
4,646
34.8
8,698
8,581
16.4
35.8
21.8
394
6,108
0
1,222
20.0
15.5
7,330
84.3
FY17
25,583
6.8
2,165
2,563
3,485
8,213
32.1
17,370
67.9
3,911
13,458
10
1,456
14,903
0
14,903
5,109
34.3
9,794
9,794
14.1
38.3
24.9
394
3,941
0
802
20.4
10.0
4,743
48.4
FY18
28,625
11.9
2,862
2,941
3,227
9,030
31.5
19,595
68.5
4,397
15,198
11
1,397
16,584
0
16,584
5,654
34.1
10,930
10,930
11.6
38.2
27.7
394
3,941
0
802
20.4
10.0
4,743
43.4
FY19
36,633
28.0
4,202
3,006
3,781
10,990
30.0
25,643
70.0
6,467
19,176
17
2,200
21,359
0
21,359
7,411
34.7
13,949
13,949
27.6
38.1
35.4
394
4,926
0
764
15.5
12.5
5,690
40.8
FY20
34,044
-7.1
5,456
2,924
3,304
11,684
34.3
22,361
65.7
6,793
15,567
78
2,489
17,979
0
17,979
4,261
23.7
13,718
13,718
-1.7
40.3
34.8
394
9,852
0
1,527
15.5
25.0
11,379
82.9
FY21
31,166
-8.5
4,030
2,797
3,665
10,492
33.7
20,674
66.3
3,821
16,853
220
2,714
19,348
0
19,348
4,144
21.4
15,204
15,204
10.8
48.8
38.6
394
1,970
0
305
15.5
5.0
2,276
15.0
FY22E
34,194
9.7
4,514
3,077
3,800
11,390
33.3
22,804
66.7
5,581
17,223
78
2,660
19,805
0
19,805
4,983
25.2
14,822
14,822
-2.5
43.3
37.6
394
9,852
0
1,527
15.5
25.0
11,379
76.8
(INR m)
FY23E
38,497
12.6
5,642
3,384
4,214
13,241
34.4
25,256
65.6
6,550
18,706
78
3,159
21,788
0
21,788
5,482
25.2
16,306
16,306
10.0
42.4
41.4
394
9,852
0
1,527
15.5
25.0
11,379
69.8
Standalone - Balance Sheet
Y/E March
Equity Share Capital
Total Reserves
Net Worth
Total Loans
Deferred Tax Liabilities
Capital Employed
Gross Block
Less: Accum. Deprn.
Net Fixed Assets
Capital WIP
Total Investments
Curr. Assets, Loans&Adv.
Account Receivables
Cash and Bank Balance
Loans and Advances
Curr. Liability & Prov.
Account Payables
Other Current Liabilities
Provisions
Net Current Assets
Appl. of Funds
E: MOFSL Estimates
FY16
1,970
33,206
35,176
0
219
35,396
15,418
7,089
8,330
6
8,508
20,980
7,329
7,877
5,763
2,428
383
1,906
139
18,552
35,396
FY17
1,970
38,247
40,218
0
556
40,773
19,203
8,183
11,021
15
14,540
17,924
7,238
7,385
3,292
2,726
497
2,034
195
15,198
40,773
FY18
1,970
44,430
46,401
0
770
47,170
22,972
12,579
10,393
442
24,121
16,949
10,084
3,071
3,791
4,734
577
4,000
157
12,215
47,170
FY19
1,970
52,435
54,405
0
1,056
55,461
28,402
19,046
9,356
133
30,505
20,700
10,790
4,709
5,199
5,233
1,986
3,073
174
15,468
55,461
FY20
1,970
54,271
56,241
0
851
57,092
35,302
25,839
9,463
663
29,490
23,552
13,100
5,288
5,164
6,074
2,771
3,094
209
17,477
57,092
FY21
1,970
67,520
69,490
0
0
69,490
37,337
29,660
7,678
1,463
37,641
30,995
13,944
8,753
8,298
8,287
2,594
3,290
2,402
22,709
69,490
FY22E
1,970
70,962
72,933
0
0
72,933
40,337
35,241
5,096
1,463
37,641
32,807
9,743
18,754
4,296
4,074
1,218
2,633
223
28,733
72,933
(INR m)
FY23E
1,970
75,889
77,859
0
0
77,859
44,337
41,791
2,546
1,463
37,641
40,796
10,969
24,976
4,836
4,587
1,371
2,964
251
36,209
77,859
12 June 2021
8
 Motilal Oswal Financial Services
Sun TV Network
Financials and valuations
Ratios
Y/E March
Basic (INR)
EPS
Cash EPS
BV/Share
DPS
Payout (%)
Valuation (x)
P/E
Cash P/E
P/BV
EV/Sales
EV/EBITDA
Dividend Yield (%)
FCF per share
Return Ratios (%)
RoE
RoCE
RoIC
Working Capital Ratios
Fixed Asset Turnover (x)
Asset Turnover (x)
Inventory (Days)
Debtor (Days)
Creditor (Days)
Leverage Ratio (x)
Current Ratio
Net Debt/Equity
FY16
21.8
34.1
89.3
15.5
84.3
24.4
15.6
6.0
8.3
11.8
2.9
22.4
24.9
24.9
40.3
1.6
0.7
0
112
6
8.6
-0.5
FY17
24.9
34.8
102.1
10.0
48.4
21.4
15.3
5.2
7.6
11.2
1.9
23.5
26.0
26.0
46.7
1.3
0.6
0
103
7
6.6
-0.5
FY18
27.7
38.9
117.7
10.0
43.4
19.2
13.7
4.5
6.6
9.7
1.9
21.5
25.2
25.3
52.2
1.2
0.6
0
129
7
3.6
-0.6
FY19
35.4
51.8
138.1
12.5
40.8
15.0
10.3
3.9
5.0
7.1
2.3
31.2
27.7
27.7
63.2
1.3
0.7
0
108
20
4.0
-0.6
FY20
34.8
52.0
142.7
25.0
82.9
15.3
10.2
3.7
5.3
8.1
4.7
24.2
24.8
24.9
56.9
1.0
0.6
0
140
30
3.9
-0.6
FY21
38.6
48.3
176.3
5.0
15.0
13.8
11.0
3.0
5.5
8.2
0.9
30.8
24.2
24.5
61.2
0.8
0.4
0
163
30
3.7
-0.7
FY22E
37.6
51.8
185.1
25.0
76.8
14.1
10.3
2.9
5.6
8.4
4.7
47.7
20.8
20.9
70.2
0.8
0.5
0
104
13
8.1
-0.8
FY23E
41.4
58.0
197.6
25.0
69.8
12.9
9.2
2.7
4.0
6.1
4.7
36.8
21.6
21.7
97.0
0.9
0.5
0
104
13
8.9
-0.8
Standalone - Cash Flow Statement
Y/E March
OP/(Loss) before Tax
Depreciation
Interest & Finance Charges
Direct Taxes Paid
(Inc)/Dec in WC
CF from Operations
Others
CF from Operating incl EO
(Inc)/Dec in FA
Free Cash Flow
(Pur)/Sale of Investments
Others
CF from Investments
Issue of Shares
Inc/(Dec) in Debt
Interest Paid
Dividend Paid
Others
CF from Fin. Activity
Inc/Dec of Cash
Opening Balance
Closing Balance
Other bank balance
Closing Balance (incl other bank bal)
FY16
13,163
4,850
22
-4,550
-260
13,225
-665
12,560
-3,713
8,847
213
-93
-3,592
0
0
-20
-7,352
0
-7,372
1,597
3,932
5,529
2,346
7,875
FY17
14,904
3,911
10
-4,877
-14
13,934
-1,027
12,907
-3,658
9,249
-4,774
1,301
-7,132
0
0
-10
-4,743
0
-4,753
1,022
5,529
6,551
833
7,385
FY18
16,584
4,397
11
-5,409
-1,086
14,497
-1,059
13,438
-4,977
8,460
-9,083
1,403
-12,658
0
0
-11
-4,743
0
-4,754
-3,969
6,551
2,583
488
3,071
FY19
21,359
6,467
17
-7,226
-848
19,769
-1,997
17,772
-5,479
12,293
-5,654
482
-10,651
0
0
-17
-5,939
0
-5,955
1,164
2,583
3,746
962
4,708
FY20
17,989
6,793
78
-4,254
-2,618
17,988
-1,885
16,103
-6,579
9,524
1,091
1,814
-3,675
0
0
-291
-11,877
17
-12,151
278
3,747
4,025
1,263
5,288
FY21
19,348
3,821
220
-5,379
-1,546
16,463
-2,019
14,444
-2,291
12,154
-7,587
-1,542
-11,419
0
0
-465
-1,970
0
-2,435
588
4,025
4,613
4,140
8,753
FY22E
19,805
5,581
78
-4,983
3,977
24,458
-2,660
21,799
-3,000
18,799
0
2,660
-340
0
0
-78
-11,379
0
-11,457
10,001
4,613
14,614
4,140
18,754
(INR m)
FY23E
21,788
6,550
78
-5,482
-1,256
21,678
-3,159
18,519
-4,000
14,519
0
3,159
-841
0
0
-78
-11,379
0
-11,457
6,221
14,614
20,835
4,140
24,976
12 June 2021
9
 Motilal Oswal Financial Services
Sun TV Network
NOTES
12 June 2021
10
 Motilal Oswal Financial Services
Sun TV Network
Explanation of Investment Rating
Investment Rating
Expected return (over 12-month)
BUY
>=15%
SELL
< - 10%
NEUTRAL
< - 10 % to 15%
UNDER REVIEW
Rating may undergo a change
NOT RATED
We have forward looking estimates for the stock but we refrain from assigning recommendation
*In case the recommendation given by the Research Analyst is inconsistent with the investment rating legend for a continuous period of 30 days, the Research Analyst shall within
following 30 days take appropriate measures to make the recommendation consistent with the investment rating legend.
Disclosures
The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).
Motilal Oswal Financial Services Ltd. (MOFSL) is a SEBI Registered Research Analyst having registration no. INH000000412. MOFSL, the Research Entity (RE) as defined in the
Regulations, is engaged in the business of providing Stock broking services, Investment Advisory Services, Depository participant services & distribution of various financial
products. MOFSL is a subsidiary company of Passionate Investment Management Pvt. Ltd.. (PIMPL). MOFSL is a listed public company, the details in respect of which are
available on www.motilaloswal.com. MOFSL (erstwhile Motilal Oswal Securities Limited - MOSL) is registered with the Securities & Exchange Board of India (SEBI) and is a
registered Trading Member with National Stock Exchange of India Ltd. (NSE) and Bombay Stock Exchange Limited (BSE), Multi Commodity Exchange of India Limited (MCX) and
National Commodity & Derivatives Exchange Limited (NCDEX) for its stock broking activities & is Depository participant with Central Depository Services Limited (CDSL) National
Securities Depository Limited (NSDL),NERL, COMRIS and CCRL and is member of Association of Mutual Funds of India (AMFI) for distribution of financial products and Insurance
Regulatory & Development Authority of India (IRDA) as Corporate Agent for insurance products.
Details of associate entities of Motilal Oswal Financial Services Limited are
available on the website at
http://onlinereports.motilaloswal.com/Dormant/documents/List%20of%20Associate%20companies.pdf
MOFSL and its associate company(ies), their directors and Research Analyst and their relatives may; (a) from time to time, have a long or short position in, act as principal in, and
buy or sell the securities or derivatives thereof of companies mentioned herein. (b) be engaged in any other transaction involving such securities and earn brokerage or other
compensation or act as a market maker in the financial instruments of the company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies) or may have
any other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report
MOFSL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report
should be aware that MOFSL may have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific
merchant banking, investment banking or brokerage service transactions. Details of pending Enquiry Proceedings of Motilal Oswal Financial Services Limited are available on the
website at
https://galaxy.motilaloswal.com/ResearchAnalyst/PublishViewLitigation.aspx
A graph of daily closing prices of securities is available at
www.nseindia.com, www.bseindia.com.
Research Analyst views on Subject Company may vary based on Fundamental
research and Technical Research. Proprietary trading desk of MOFSL or its associates maintains arm’s length distance with Research Team as all the activities are segregated
from MOFSL research activity and therefore it can have an independent view with regards to Subject Company for which Research Team have expressed their views.
Regional Disclosures (outside India)
This report is not directed or intended for distribution to or use by any person or entity resident in a state, country or any jurisdiction, where such distribution, publication, availability
or use would be contrary to law, regulation or which would subject MOFSL & its group companies to registration or licensing requirements within such jurisdictions.
For Hong Kong:
This report is distributed in Hong Kong by Motilal Oswal capital Markets (Hong Kong) Private Limited, a licensed corporation (CE AYY-301) licensed and regulated by the Hong
Kong Securities and Futures Commission (SFC) pursuant to the Securities and Futures Ordinance (Chapter 571 of the Laws of Hong Kong) “SFO”. As per SEBI (Research Analyst
Regulations) 2014 Motilal Oswal Securities (SEBI Reg No. INH000000412) has an agreement with Motilal Oswal capital Markets (Hong Kong) Private Limited for distribution of
research report in Hong Kong. This report is intended for distribution only to “Professional Investors” as defined in Part I of Schedule 1 to SFO. Any investment or investment activity
to which this document relates is only available to professional investor and will be engaged only with professional investors.” Nothing here is an offer or solicitation of these
securities, products and services in any jurisdiction where their offer or sale is not qualified or exempt from registration. The Indian Analyst(s) who compile this report is/are not
located in Hong Kong & are not conducting Research Analysis in Hong Kong.
For U.S.
Motilal Oswal Financial Services Limited (MOFSL) is not a registered broker - dealer under the U.S. Securities Exchange Act of 1934, as amended (the"1934 act") and under
applicable state laws in the United States. In addition MOFSL is not a registered investment adviser under the U.S. Investment Advisers Act of 1940, as amended (the "Advisers
Act" and together with the 1934 Act, the "Acts), and under applicable state laws in the United States. Accordingly, in the absence of specific exemption under the Acts, any
brokerage and investment services provided by MOFSL , including the products and services described herein are not available to or intended for U.S. persons. This report is
intended for distribution only to "Major Institutional Investors" as defined by Rule 15a-6(b)(4) of the Exchange Act and interpretations thereof by SEC (henceforth referred to as
"major institutional investors"). This document must not be acted on or relied on by persons who are not major institutional investors. Any investment or investment activity to which
this document relates is only available to major institutional investors and will be engaged in only with major institutional investors. In reliance on the exemption from registration
provided by Rule 15a-6 of the U.S. Securities Exchange Act of 1934, as amended (the "Exchange Act") and interpretations thereof by the U.S. Securities and Exchange
Commission ("SEC") in order to conduct business with Institutional Investors based in the U.S., MOFSL has entered into a chaperoning agreement with a U.S. registered broker-
dealer, Motilal Oswal Securities International Private Limited. ("MOSIPL"). Any business interaction pursuant to this report will have to be executed within the provisions of this
chaperoning agreement.
The Research Analysts contributing to the report may not be registered /qualified as research analyst with FINRA. Such research analyst may not be associated persons of the U.S.
registered broker-dealer, MOSIPL, and therefore, may not be subject to NASD rule 2711 and NYSE Rule 472 restrictions on communication with a subject company, public
appearances and trading securities held by a research analyst account.
For Singapore
In Singapore, this report is being distributed by Motilal Oswal Capital Markets Singapore Pte Ltd (“MOCMSPL”) (Co.Reg. NO. 201129401Z) which is a holder of a capital markets
services license and an exempt financial adviser in Singapore.As per the approved agreement under Paragraph 9 of Third Schedule of Securities and Futures Act (CAP 289) and
Paragraph 11 of First Schedule of Financial Advisors Act (CAP 110) provided to MOCMSPL by Monetary Authority of Singapore. Persons in Singapore should contact MOCMSPL
in respect of any matter arising from, or in connection with this report/publication/communication. This report is distributed solely to persons who qualify as “Institutional Investors”,
of which some of whom may consist of "accredited" institutional investors as defined in section 4A(1) of the Securities and Futures Act, Chapter 289 of Singapore (“the
SFA”). Accordingly, if a Singapore person is not or ceases to be such an institutional investor, such Singapore Person must immediately discontinue any use of this Report and
inform MOCMSPL.
Specific Disclosures
1 MOFSL, Research Analyst and/or his relatives does not have financial interest in the subject company, as they do not have equity holdings in the subject company.
2 MOFSL, Research Analyst and/or his relatives do not have actual/beneficial ownership of 1% or more securities in the subject company
3 MOFSL, Research Analyst and/or his relatives have not received compensation/other benefits from the subject company in the past 12 months
4 MOFSL, Research Analyst and/or his relatives do not have material conflict of interest in the subject company at the time of publication of research report
5 Research Analyst has not served as director/officer/employee in the subject company
6 MOFSL has not acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
7 MOFSL has not received compensation for investment banking/ merchant banking/brokerage services from the subject company in the past 12 months
8 MOFSL has not received compensation for other than investment banking/merchant banking/brokerage services from the subject company in the past 12 months
9 MOFSL has not received any compensation or other benefits from third party in connection with the research report
10 MOFSL has not engaged in market making activity for the subject company
12 June 2021
11
 Motilal Oswal Financial Services
Sun TV Network
********************************************************************************************************************************
The associates of MOFSL may have:
- financial interest in the subject company
- actual/beneficial ownership of 1% or more securities in the subject company
- received compensation/other benefits from the subject company in the past 12 months
- other potential conflict of interests with respect to any recommendation and other related information and opinions.; however the same shall have no bearing whatsoever on the
specific recommendations made by the analyst(s), as the recommendations made by the analyst(s) are completely independent of the views of the associates of MOFSL even
though there might exist an inherent conflict of interest in some of the stocks mentioned in the research report.
- acted as a manager or co-manager of public offering of securities of the subject company in past 12 months
- be engaged in any other transaction involving such securities and earn brokerage or other compensation or act as a market maker in the financial instruments of the
company(ies) discussed herein or act as an advisor or lender/borrower to such company(ies)
- received compensation from the subject company in the past 12 months for investment banking / merchant banking / brokerage services or from other than said services.
The associates of MOFSL has not received any compensation or other benefits from third party in connection with the research report
Above disclosures include beneficial holdings lying in demat account of MOFSL which are opened for proprietary investments only. While calculating beneficial holdings, It does not
consider demat accounts which are opened in name of MOFSL for other purposes (i.e holding client securities, collaterals, error trades etc.). MOFSL also earns DP income from
clients which are not considered in above disclosures.
Analyst Certification
The views expressed in this research report accurately reflect the personal views of the analyst(s) about the subject securities or issues, and no part of the compensation of the
research analyst(s) was, is, or will be directly or indirectly related to the specific recommendations and views expressed by research analyst(s) in this report.
Terms & Conditions:
This report has been prepared by MOFSL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and
may not be altered in any way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent
of MOFSL. The report is based on the facts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in
nature. The information is obtained from publicly available media or other sources believed to be reliable. Such information has not been independently verified and no guaranty,
representation of warranty, express or implied, is made as to its accuracy, completeness or correctness. All such information and opinions are subject to change without notice. The
report is prepared solely for informational purpose and does not constitute an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial
instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive this report at the same time. MOFSL will not treat recipients as
customers by virtue of their receiving this report.
Disclaimer:
The report and information contained herein is strictly confidential and meant solely for the selected recipient and may not be altered in any way, transmitted to, copied or
distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent. This report and information herein is solely for
informational purpose and may not be used or considered as an offer document or solicitation of offer to buy or sell or subscribe for securities or other financial instruments. Nothing
in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to your specific circumstances.
The securities discussed and opinions expressed in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investment
objectives, financial positions and needs of specific recipient. This may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this
document should make such investigations as it deems necessary to arrive at an independent evaluation of an investment in the securities of companies referred to in this
document (including the merits and risks involved), and should consult its own advisors to determine the merits and risks of such an investment. The investment discussed or views
expressed may not be suitable for all investors. Certain transactions -including those involving futures, options, another derivative products as well as non-investment grade
securities - involve substantial risk and are not suitable for all investors. No representation or warranty, express or implied, is made as to the accuracy, completeness or fairness of
the information and opinions contained in this document. The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and
should not be treated as endorsement of the views expressed in the report. This information is subject to change without any prior notice. The Company reserves the right to make
modifications and alternations to this statement as may be required from time to time without any prior approval. MOFSL, its associates, their directors and the employees may from
time to time, effect or have effected an own account transaction in, or deal as principal or agent in or for the securities mentioned in this document. They may perform or seek to
perform investment banking or other services for, or solicit investment banking or other business from, any company referred to in this report. Each of these entities functions as a
separate, distinct and independent of each other. The recipient should take this into account before interpreting the document. This report has been prepared on the basis of
information that is already available in publicly accessible media or developed through analysis of MOFSL. The views expressed are those of the analyst, and the Company may or
may not subscribe to all the views expressed therein. This document is being supplied to you solely for your information and may not be reproduced, redistributed or passed on,
directly or indirectly, to any other person or published, copied, in whole or in part, for any purpose. This report is not directed or intended for distribution to, or use by, any person or
entity who is a citizen or resident of or located in any locality, state, country or other jurisdiction, where such distribution, publication, availability or use would be contrary to law,
regulation or which would subject MOFSL to any registration or licensing requirement within such jurisdiction. The securities described herein may or may not be eligible for sale in
all jurisdictions or to certain category of investors. Persons in whose possession this document may come are required to inform themselves of and to observe such restriction.
Neither the Firm, not its directors, employees, agents or representatives shall be liable for any damages whether direct or indirect, incidental, special or consequential including lost
revenue or lost profits that may arise from or in connection with the use of the information.
The person accessing this information specifically agrees to exempt MOFSL or any of its
affiliates or employees from, any and all responsibility/liability arising from such misuse and agrees not to hold MOFSL or any of its affiliates or employees responsible for any such
misuse and further agrees to hold MOFSL or any of its affiliates or employees free and harmless from all losses, costs, damages,
expenses that may be suffered by the person
accessing this information due to any errors and delays.
Registered Office Address: Motilal Oswal Tower, Rahimtullah Sayani Road, Opposite Parel ST Depot, Prabhadevi, Mumbai-400025; Tel No.: 022 71934200/ 022-71934263;
Website
www.motilaloswal.com.CIN
no.: L67190MH2005PLC153397.Correspondence Office Address: Palm Spring Centre, 2nd Floor, Palm Court Complex, New Link Road,
Malad(West), Mumbai- 400 064. Tel No: 022 7188 1000.
Registration Nos.: Motilal Oswal Financial Services Limited (MOFSL)*: INZ000158836(BSE/NSE/MCX/NCDEX); CDSL and NSDL: IN-DP-16-2015; Research Analyst:
INH000000412. AMFI: ARN - 146822; Investment Adviser: INA000007100; Insurance Corporate Agent: CA0579;PMS:INP000006712. Motilal Oswal Asset Management Company
Ltd. (MOAMC): PMS (Registration No.: INP000000670); PMS and Mutual Funds are offered through MOAMC which is group company of MOFSL. Motilal Oswal Wealth
Management Ltd. (MOWML): PMS (Registration No.: INP000004409) is offered through MOWML, which is a group company of MOFSL. Motilal Oswal Financial Services Limited is
a distributor of Mutual Funds, PMS, Fixed Deposit, Bond, NCDs,Insurance Products and IPOs.Real Estate is offered through Motilal Oswal Real Estate Investment Advisors II Pvt.
Ltd. which is a group company of MOFSL. Private Equity is offered through Motilal Oswal Private Equity Investment Advisors Pvt. Ltd which is a group company of MOFSL.
Research & Advisory services is backed by proper research. Please read the Risk Disclosure Document prescribed by the Stock Exchanges carefully before investing. There is no
assurance or guarantee of the returns. Investment in securities market is subject to market risk, read all the related documents carefully before investing. Details of Compliance
Officer: Name: Neeraj Agarwal, Email ID: na@motilaloswal.com, Contact No.:022-71881085.
* MOSL has been amalgamated with Motilal Oswal Financial Services Limited (MOFSL) w.e.f August 21, 2018 pursuant to order dated July 30, 2018 issued by Hon'ble National
Company Law Tribunal, Mumbai Bench.
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