HUMNL: Multiple initiatives & diversification ahead
Hum Network Ltd (HUMNL), Pakistan’s only public listed broadcasting company, conducted its analyst briefing to discuss its current and future plans. The broadcasting portfolio of the company consists of Hum TV, Hum Sitaray and Hum Masalay. It also operates Hum Films as a Separate Business Unit (SBU) that deals in production, marketing and distribution of films. HUMNL is also working in the printed media segment through its subsidiary Skyline Publications.
HUMNL’s bottom-line has grown at a 4-yr CAGR of 16% while the payout has plunged significantly to 9% in FY17 from 66% in FY15. The payout is expected to remain in the range of 10-15% to invest in upcoming ventures and keep on the lookout for other opportunities. The stock is trading at P/E of 8.72x vs regional PE of 18.64x.
Currently, advertisement accounts for 89% of HUMNL’s revenue and may continue to be a major revenue source. The upcoming elections will likely see a surge in advertising revenue due to ad spend from political parties (PKR5bn were spent by political parties on advertising in 2013 general elections). As the political dust settles post elections, advertising revenue would likely pick up.
There is no subscription based revenue for broadcasters in Pakistan as yet, however the company along with other major broadcasters is urging other members of Pakistan Broadcaster’s Association (PBA) to come together and demand cable operators for subscription revenue as is practiced globally.
Hum Network Limited. Hum Network Limited is engaged in the business of electronic media. The Company's broadcasting portfolio consists of satellite channels, such as HUM TV, HUM Sitaray, HUM Masala and HUM World (including separate beams for North America, the United Kingdom and the Middle East). The Company also has strategic business units (SBUs) in films, digital media, as well as print media. It broadcasts various dramas in northern areas of Pakistan, such as Diyar-e-Dil, Jugnoo and Gul-e-Rana. It other programs include Mohabbat Aag Si, Maan, Mol, Sangat, Abro, Mana ka Gharana and Muqadas. Its HUM TV is available in parts of the Middle East, North America, Africa, Australia and all of Asia. Its Masala TV is a food channel mainly catering to South East Asia food recipes and is available in the United States, Australia and the Middle East. HUM SITARAY broadcasts programs for thrill seekers, the game players, the kids and the teenagers. Its magazines include Masala Tv Food Mag and Style G.L.A.M.
BMA is amongst the leading financial groups in Pakistan. BMA Capital’s core areas of business include Capital Markets, Corporate Finance & Advisory, Asset Management, and Financial Products Distribution. BMA Capital is the leader in privatisation advisory in Pakistan, having successfully advised on over 50% of all privatisations in Pakistan, by value, in transactions valued in excess of US$4 billion. Recent transactions include joint lead managing the $813 million GDR Offering of 10% of OGDCL on the London Stock Exchange in 2006-07, and advising Etisalat on their successful acquisition of a 26% strategic stake in Pakistan Telecommunications Company Limited (PTCL) for US$2.6 billion, the largest M&A transaction and foreign direct investment in Pakistan’s history. The firm is among the top brokers in the Pakistan equity and treasury markets, and is among a handful of firms that comprehensively cover all segments of the capital markets. This is supported by a very strong and independent research capability, which is quoted regularly in both local and international media. BMA Capital’s retail brokerage brand, BMA Trade, has launched a nationwide network of branches as well as a comprehensive online trading platform, enabling investors across Pakistan to take part in the capital markets.
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