Media Q4 Earnings Preview - Valuations Attractive; Risk-Reward Favorable: Dolat Capital
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Dolat Capital Report
We expect a modest recovery in ad revenues aided by low-base (down15% YoY for Zee Entertainment Enterprises Ltd. and 16% for Sun Tv Network Ltd. in Q4 FY20).
Fast-moving consumer goods, paints, auto etc. we estimate to be the key sectors driving the performance.
Zee would also benefit from the conversion of pay channels to free-to-air driving ~5-6% ad revenue growth.
We estimate a modest growth in subscription revenues primarily driven by digital business.
Broadcast business subscription revenues we expect to be flattish to low-single-digit growth.
Ebitda growth to be healthy for Zee (~65%) led by lower content costs.
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