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Decent performance…

About the stock: TV Today Network (TV Today) 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.

* It has maintained its leadership in the Hindi new segment across the last two decades

Q1FY22 Results: TV Today’s performance was better than expected.

* Topline at | 203.9 crore was up 21.6% YoY on a benign base (decline of 32%). TV broadcasting revenues came in | 162.8 crore (up 18% YoY). Radio revenues were at | 3 crore, witnessing 10x YoY growth on washout base. The key growth driver was digital segment, which continued its growth momentum with 38% growth YoY to | 38.1 crore

* EBITDA came in at | 52.3 crore, up 74% with margins of 25.7% (up 776 bps YoY on depressed base and up 246 bps QoQ) on operating leverage.

* PAT grew 1.9x YoY to | 37.3 crore, aided by superior operating performance

What should investors do?

TV Today’s share price has underperformed with decline of ~3% over past five years.

* We maintain our HOLD rating

Target Price and Valuation: We value TV Today at | 330 i.e. 10x FY23E EV/EBITDA

Key triggers for future price performance:

* Viewership measurement changes by BARC, as the rating are suspended since last year

* Election benefits from states such as UP, Punjab

* Viewership market dynamics especially with launch of new Hindi news channel by Times Now

Alternate Stock Idea: Besides TV Today, we like PVR in the media space.

* A play on reopening and improving market share of multiplexes

* BUY with a target price of | 1610

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