Revenues came in higher than expected at | 760.8 crore (estimated: | 739.2 crore) on account of better than expected revenues from IPL of | 144.0 crore vs. estimates of | 117.0 crore. The subscription revenues came in at | 232.1 crore (up by 20.3% YoY) higher than our estimates of | 217.4 crore (up 12.6% YoY) primarily led by strong traction in the cable subscription revenues. However on the ad revenue front, Sun TV posted de-growth of 2.9% YoY vs. estimates of a 1.8% YoY growth largely due to decline in non Tamil markets. EBITDA came in at | 436.4 crore, slightly lower than our expectation of | 438.9 crore, up 6.7% YoY. The margins came in lower at 57.4% (down 184 bps YoY) vs. estimates of 59.4% owing to higher than expected administrative expenses.
Valuation: The promoter is under the CBI lens and any negative outcome on the same could have spill over effects on the company. Hence they continue to maintain HOLD recommendation with a revised target price of | 480 at a 15x FY18E EPS of | 32.0.