INSUBCONTINENT EXCLUSIVE:
news print prices are expected boost profitability
The likelihood of an increase in ads in run-up to general elections is also expected to lift sentiment for these stocks which have fallen
40-60 per cent in last one year.
DB Corp is most preferred bet among print companies as its advertisement growth is relatively better than
advertising revenue for these companies comes from government ads
government announced a hike of 25 per cent over and above existing rate structure
Analysts said move will boost profitability of print media companies, especially regional papers
About 10-15 per cent of advertising revenue for these companies comes from government advertisements, said analysts
The last revision was in 2013 when an increase of 19 per cent was announced over and above rates of 2010 This decision will be valid for
three years.
Abneesh Roy, Senior Vice President-Institutional Equities at Edelweiss Securities said these stocks has not been on radar of
to gather pace in fourth quarter of FY19, and FY20 spurred by this development as well as spurt in election-related advertising
The valuation for print media remains attractive at around 10 times FY20 price-to-earnings, and we expect certain re-rating to happen for
and Services Tax and RERA
Higher newsprint cost also spoiled sentiment
Shares of Jagran, DB Corp and HT Media fell 38-64 per cent in one year till Tuesday.
ICICIdirect has raised target price on DB Corp to Rs
215 from Rs 190 and for Jagran Prakashan, target price has been increased to Rs 130 from Rs Rs 112
However, it prefers DB Corp to Jagran Prakashan.
