Media, Entertainment Q1 Results Preview - To Be A Tough Quarter: Prabhudas Lilladher

Prabhudas Lilladher Report

Media: In line with the previous quarter, net box office collections for the industry stood at ~Rs 18.6 billion in Q1 FY24. Accordingly, we expect PVR-Inox Ltd. to mimic the performance of earlier quarter with footfalls of 33 million (30.5 million in Q4 FY23) and pre-Indian Accounting Standard Ebitda margin of 5.8% (achieved break-even in Q4 FY23).

On broadcasting side, ZEE Entertainment Enterprises Ltd.’s performance is likely to be impacted by continued weakness in ad-environment and higher investment in content. We expect domestic ad-revenues to decline 2.5% YoY to Rs 9 billion with an Ebitda margin of 6.3%.

Entertainment: While Nazara Technologies Ltd.’s top-line growth of 26.1% YoY will be aided by consolidation of WildWorks, we expect sequential expansion in Ebitda margin to 12%. We believe Nodwin is on a strong growth path as recent fund infusion of ~Rs 2 billion can help the business expand inorganically, while return of Battlegrounds Mobile India is a big positive for Esports viewership.

Top pick: Nazara remains our preferred pick in the media and entertainment space and we expect sales/profit after tax compound annual growth rate of 27%/49% respectively over FY23- 25E.

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