DB Corp Q1 Review - Margin Pressure From Rise In Newsprint Prices: ICICI Securities
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ICICI Securities Report
DB Corp Ltd.’s Q1 FY22 Ebitda was negligible due to:
ad revenue decline of 45% QoQ on second lockdown, and
14% QoQ rise in newsprint prices.
Company has since seen recovery in ad revenues with the July 2021 number at 75% of July 2019.
It remains confident of significant recovery in the coming festive season.
DB Corp's newsprint prices costs are likely to increase in Q2 FY22 too by a further 2-3% with domestic newsprint prices are already up 35% YoY.
Prices of this vital raw material could put significant pressure on margins as the company does not see ability to pass the entire inflation through cover price hike.
The company is yet to receive observations from Central Board of Direct Taxes survey at its premises.
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