EUR 120.00 For Business Accounts Only

MOSL: Morning India (16/January/19): 1. Zee Entertainment (A stellar show); 2. KPIT Tech; 3. MCX; 4. Trident; 5. Consumer Electricals; 6. Healthcare; 7. Media

MOrning India (16/January/19): 1. Zee Entertainment (A stellar show); 2. KPIT Tech; 3. MCX; 4. Trident; 5. Consumer Electricals; 6. Healthcare; 7. Media

 

Today’s top research idea

Zee Entertainment: A stellar show; uncertainty over promoter stake sale a key concern

• revenue grew 18% YoY to INR21.7b (in-line), driven by robust ad/subscription growth. EBITDA grew 27% YoY to INR7.5b (5% beat), with margin expanding 250bp YoY to 34.8%. This, coupled with higher other income and fair value gains, led to PAT growth of 50% YoY to INR5.6b (+26% YoY adjusted for fair value gains).
• We expect revenue/ EBITDA/PAT CAGR of 14%/16%/20% over FY19-21 on the back of 15%/12% domestic ad/ subscription revenue growth.
• We restore our rating on ZEEL (Neutral v/s under review earlier). Despite the upbeat outlook, we see uncertainty around promoter stake sale to strategic investor, its priorities on time horizon for returns from digital segment, and risk of overlapping businesses. Our TP stands at INR475, ascribing 20x (10% discount to three-year average) to FY21E EPS.

Piping hot news

December Trade Data: Imports contract after 27 months, exports up 0.34%

• Trade slowdown worsened in December 2018, as merchandise export growth plunged for a second straight month to just 0.34% and imports witnessed their first contraction since September 2016. Trade deficit, consequently, eased to $13.1 billion in December, the lowest since February last year, showed the data released by the commerce ministry on Tuesday.