- Sun TV shares rose around 28% in September, driven by multiple earnings catalysts
- Cricket franchise revenue grew 33% YoY, boosting consolidated revenue by 13% in Q1 FY27
- Advertising revenue fell 2.6%, highlighting the need for a recovery in core TV advertising
Sun TV Network shares are having a sharp September run, with the stock up around 28% so far this month. Several potential earnings catalysts, including the performance of Sun TV's cricket franchise, the upcoming release of Jailer 2 and the company's cash position, have now come into focus.
The biggest boost in Q1 FY27 came from cricket. Sun TV's cricket franchise revenue rose about 33% year on year, reaching nearly Rs 630 crore, helping consolidated revenue rise 13%. EBITDA increased 19%, while profit after tax climbed 16%. The EBITDA margin stood at around 51.5%.
The improvement, however, was not across the board. Advertising revenue declined 2.6%, while domestic subscription revenue grew 3.3%. This makes a recovery in the core television advertising business an important trigger for the stock. The other potential catalyst is Jailer 2, the Rajinikanth-starrer expected to contribute to Sun TV's content and movie-related revenue in Q3FY27.
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Cash, Cricket Value In Focus
Sun TV ended FY26 with around Rs 250 crore of cash, according to estimates. Market chatter around possible capital deployment, including a buyback, has added another layer to the stock narrative.
Nuvama's valuation framework also highlights the value embedded in Sun TV's cricket assets. The brokerage has estimated the cricket franchise value at around Rs 185 billion, while valuing the core business at roughly 6x FY27 estimated earnings after stripping out cash.
Sun TV has a market capitalisation of around Rs 21,000 crore, making the valuation of its cricket and core television businesses an important part of how investors assess the stock.
The key question is whether the recent momentum can broaden beyond cricket. A meaningful recovery in advertising revenue remains critical for a sustained re-rating, particularly as FMCG companies continue to shift more advertising spending towards digital platforms. Investors will also watch cash deployment, dividends and any potential restructuring, alongside the contribution from Jailer 2.
Stock Movement
Sun TV shares are rallying in trade on Wednesday, up over 11.2% to Rs 615.45 apiece.
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