Buy This Leading Media & Entertainment Industry Stock For Target Price Of Rs 350, Gains Up To 26%

ICICI Direct has recently published a report on TV Today Network (TV Today), suggesting that investors buy the stocks of the company for the target price of Rs 350 apiece. TV Today is a small cap media industry company having a market cap of Rs 1,712.79 crore.

TV Today Network is a leading news company engaged in broadcasting operations. Part of the India Today Group, the company operates mainly in three segments-digital, television and radio broadcasting. The company has consistently maintained its leadership in the Hindi new segment across the last two decades.

Stock Outlook & Returns

On NSE, the Current Market Price (CMP) of TV Today Network is Rs 279.65 apiece. The stock is trading Rs 44.1 above the 52 week low and Rs 180.45 below the 52 week high of the stock, respectively.

The 52-week low level of the stock is Rs 235.55 apiece recorded on 25 May 2022, and the 52-week high is Rs 460.10 apiece recorded on 14 December 2021.

Over the week, the shares of the company have fallen roughly 0.23% and gained 4.39% in the past 1 month, respectively. Over the past 1 year, the stocks have fallen roughly 2.73%. Over the past 3 the shares witnessed a fall of 9.12%, whereas over the 5 years, the shares gained 12.9%.

The ROE of the stock is 15.67%. TTM EPS is 30.04. 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 stocks of the company at the current market price, they can expect potential gains of 26%, if we consider the estimated target price by the brokerage firm.

Q1FY23 Results

According to the ICICI Direct Research, the TV Today's performance was weak.

Topline came in at Rs 218.2 crore, up 7% with TV and other media (clubbed segment of broadcasting and digital) revenues at Rs 214.6 crore (up 7 % YoY). While TV broadcasting revenues would have been muted YoY due to lower ad inventory, growth would have been led by digital segment (~30%+ growth as per our computation).

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 higher employee costs (up 27% YoY) led by front loading of costs for digital segment expansion.

Reported PAT at Rs 35.1 crore was down 6.1% YoY with lower margins dragging the bottomline.

Buy for a target price of Rs 350 apiece

TV Today's share price has underperformed with a stock price return of merely ~16% over the past five years. "We maintain BUY as we believe that with stable double digit growth, healthy return ratio and current valuations provides a margin of safety. Any announcement of cash utilisation like dividend/digital asset acquisition (which the company is contemplating) will also be a key trigger. We value TV Today at Rs 350 i.e. 10x FY24E P/E," the brokerage said.

Disclaimer

The stock has been picked from the brokerage report of ICICI Direct. Greynium Information Technologies, the Author, and the respective Brokerage House are not liable for any losses caused as a result of decisions based on the article. Goodreturns.in advises users to check with certified experts before taking any investment decision.