Stock in Action – Sun TV

Tanushree Jaiswal Tanushree Jaiswal

Last Updated: 12th June 2024 - 03:57 pm

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Sun TV share Price Movement of Day
 

 

Highlights

1. Sun TV Network financial performance has shown significant growth over past year.
2. Sun TV share price analysis indicates bullish trend in market.
3. Sun TV quarterly earnings report highlighted significant profit growth.
4. Sun TV Network Ltd. gains for the third session in a row, rising 1.66%.
5. Sun TV Network stock forecast suggests positive trends for future.
6. Sun TV Network Ltd is currently trading at Rs 737.4, showing a 1.66% increase as of 12:49 IST on the NSE.
7. Nifty Media index has seen a rise of 14.57% in the last month, with Sun TV Network Ltd being a key constituent.
8. Sun TV stock performance has been impressive, gaining 65.84% over the past year.
9. NIFTY gain comparison reveals that Sun TV Network Ltd's growth of 65.84% outperformed NIFTY's 25.42% gain in the same period.
10. Sun TV futures contract for June is currently quoting at Rs 742.05, up 2.01% on the day.

Why Sun TV Share is in Buzz?

Sun TV Network Limited has been making headlines with its impressive financial performance for quarter ending March 2024. SunTv's standalone net sales surged to ₹927.12 crore, marking 13.96% increase year-over-year from ₹813.53 crore in March 2023. Additionally, net profit rose by 9.01% to ₹398.77 crore, up from ₹365.82 crore in previous year. These robust financial results have sparked significant interest in Sun TV's shares among investors & market analysts alike.

Should I Invest in Sun TV Shares? & Why? 

Investing in Sun TV shares requires thorough understanding of its financial health, market position, & potential risks. Here's detailed analysis to help you make informed decision.

SunTV’s  Financial Performance

Sun TV Network has shown consistent upward trend in its financial metrics. company's EBITDA stood at ₹638.69 crore in March 2024, up 12.37% from ₹568.40 crore in March 2023. Earnings per share (EPS) also increased to ₹10.11 from ₹9.28 over same period. Despite these positive indicators, stock price has experienced slight decline of 0.69% over past six months but has achieved substantial return of 51.55% over last 12 months.

Non-Operating Revenue

A notable aspect of Sun TV's recent performance is significant spike in non-operating revenue, which increased from ₹6.90 million to ₹5.05 billion. While this boosts bottom line, there is risk that such non-recurring revenue may not continue in future, potentially impacting profit margins.

Market & Competitive Analysis

Sun TV Network has strong regional presence, particularly in South Indian market. However, its venture into northern market has not been as successful. Competitors like Zee are making inroads into southern market, posing challenge to Sun TV's dominance. Additionally, Sun TV's performance in over-the-top (OTT) segment is under scrutiny, with calls for more aggressive strategies in creating original content & acquiring movie rights.

Analyst Recommendations

Analysts have mixed opinions about Sun TV's future prospects. SSJ Finance & Securities' Sr Technical Analyst Viral Chheda recommended cautious approach, highlighting importance of technical indicators such as Stochastics Oscillator & Bull Run patterns. On other hand, JM Financial Research points out that company's revenues were below expectations due to lower movie distribution revenues & weak advertising growth.

Perspective

Despite these challenges, several brokerages remain positive on Sun TV due to its attractive valuations. Elara Capital has buy rating with target price of ₹800, citing strong regional content focus & healthy profitability margins. Nuvama Research also highlights company's outperformance in advertising revenue growth & expects re-rating if there is value unlocking for its IPL franchise.

Ownership Structure

Sun TV Network's ownership structure is another critical factor. Kalanithi Maran, company's key executive, holds 75% of shares, indicating strong insider ownership. Institutional investors also hold significant portion of company's stock, suggesting certain degree of credibility in investment community.

Dividend Yield & Free Cash Flow

From investment standpoint, Sun TV offers healthy 4% dividend yield & 6% free cash flow yield, making it attractive option for income-focused investors. company's strong cash flow generation supports its ability to return capital to shareholders.

Strengths Weaknesses
Company has reduced debt. The company has delivered a poor sales growth of 2.51% over past five years.
Company is almost debt free. Working capital days have increased from 225 days to 475 days
Company has been maintaining a healthy dividend payout of 34.2%.  

Conclusion 

Investing in Sun TV shares presents both opportunities & risks. company's strong financial performance, robust regional presence, & attractive dividend yield is compelling reasons to consider investing. However, potential investors should also be mindful of reliance on non-operating revenue, competitive pressures, & need for more aggressive strategy in OTT segment.
 

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Disclaimer: Investment/Trading in securities Market is subject to market risk, past performance is not a guarantee of future performance. The risk of loss in trading and investment in Securities markets including Equites and Derivatives can be substantial.

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