X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2019 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
Balaji Telefilms: Margins explode - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Balaji Telefilms: Margins explode

Aug 22, 2002

Balaji Telefilms continues to create history of sorts. There is consistent rise in realisations per episode and new serial introductions, all this backed by sustained quality content from the company's production house. The company's operating margins have scaled new heights, making even the peak margins of IT companies pale in comparision.

(Rs m) 1QFY02 1QFY03 % Change
Sales 237 398 68.1%
Other Income 0 0 -
Expenditure 164 185 13.0%
Operating Profit (EBDIT) 73 213 191.9%
Operating Profit Margin (%) 30.8% 53.5%  
Interest 0 0 -
Depreciation 2 9 430.8%
Profit before Tax 71 203 185.5%
Extraordinary Income 8 2 -69.5%
Tax 14 74 429.7%
Profit after Tax/(Loss) 49 127 156.8%
Net profit margin (%) 20.9% 31.9%  
No. of Shares (eoy) (m) 10.3 10.3  
Diluted Earnings per share* 19.2 49.3  
P/E (at current price) 10.6  
(*- annualised)      

The revenue mix of the company is now completely skewed towards commissioned programs. Here, the company gets an assured margin from the broadcasters against the transfer of its IPR for the content. With programming cost already taken care of, any upward revision in rates for commissioned programs directly translates into bottomline increase for the company. Considering the performance of the company on the TRP charts, Balaji has a strong bargaining power with all the broadcasters and the rates offered to the company by them are around 60-70% higher compared to other content providers. Sponspored programs on the other hand are the ones where the company takes the risk. Interestingly, the sponspored program list consists mainly of Non-hindi based programs which ideally are dubbed from the existing Hindi programs and hence the costs here are already covered.

Revenue Mix 1QFY03 % Share FY02 % Share
Commissioned Programs 343 86.1% 796 72.2%
Sponsored Programs 55 13.9% 307 27.8%
Total 398 100.0% 1,103 100.0%

Presently the company has 15 serials on air on various channels besides re-running 3 serials on Star, which were earlier on Channel Nine (Nine Gold - DD Metro). The re-run is expected to get over by the end of 2QFY03 and fresh episodes would start thereafter. The company is expected to foray into weekend programming in the current fiscal. The company believes that there is vaccum of good programmes on the weekends currently and plans to create programs to fill up these slots. The next thing on the block is small / medium budget telefilm production.

OPM- Displaying strong bargaining power
Operating margins 1QFY03 FY02
Commissioned Programs 62.3% 55.6%
Sponsored Programs 39.3% 31.2%

At the current market price of Rs 524, the stock is trading at 11x its annualised earnings for 1QFY03. The company is considering sub-division of its shares of face value of Rs 10 each into shares of Rs 2 each credited as fully paid up.

The company is expected to continue its growth momentum as programming hours are set to increase.However, markets seem to have been already build in a lot of expectations from the company. Going forward, the company needs to maintain its leadership position in creating cutting edge content. Forward numbers for the next two years look attractive. The company has an unparelleled track record. However, success cannot be assured going forward. Further, considering the current margins of the company there is little room for improvement and with competition getting smarter the company will be hard pressed to maintain its current margins.


Equitymaster requests your view! Post a comment on "Balaji Telefilms: Margins explode". Click here!

  

More Views on News

BALAJI TELEFILMS Announces Quarterly Results (3QFY19); Net Profit Down 10.0% (Quarterly Result Update)

Feb 13, 2019 | Updated on Feb 13, 2019

For the quarter ended December 2018, BALAJI TELEFILMS has posted a net profit of Rs 273 m (down 10.0% YoY). Sales on the other hand came in at Rs 963 m (up 47.9% YoY). Read on for a complete analysis of BALAJI TELEFILMS's quarterly results.

BALAJI TELEFILMS 2017-18 Annual Report Analysis (Annual Result Update)

Jan 1, 2019 | Updated on Jan 1, 2019

Here's an analysis of the annual report of BALAJI TELEFILMS for 2017-18. It includes a full income statement, balance sheet and cash flow analysis of BALAJI TELEFILMS. Also includes updates on the valuation of BALAJI TELEFILMS.

BALAJI TELEFILMS Announces Quarterly Results (2QFY19); Net Profit Down 211.5% (Quarterly Result Update)

Nov 27, 2018 | Updated on Nov 27, 2018

For the quarter ended September 2018, BALAJI TELEFILMS has posted a net profit of Rs 154 m (down 211.5% YoY). Sales on the other hand came in at Rs 1 bn (up 8.5% YoY). Read on for a complete analysis of BALAJI TELEFILMS's quarterly results.

BALAJI TELEFILMS 2017-18 Annual Report Analysis (Annual Result Update)

Aug 20, 2018 | Updated on Aug 20, 2018

Here's an analysis of the annual report of BALAJI TELEFILMS for 2017-18. It includes a full income statement, balance sheet and cash flow analysis of BALAJI TELEFILMS. Also includes updates on the valuation of BALAJI TELEFILMS.

GTPL Hathway Ltd. (IPO)

Jun 21, 2017

Should one subscribe to the IPO of GTPL Hathway Ltd?

More Views on News

Most Popular

My Master Series on How to Trade Election 2019(Profit Hunter)

Apr 16, 2019

For 30 years he has watched how elections impact the markets, and practiced how to profit from it. Now he is here...telling you everything. Read on...

Election Series: Follow the World's Biggest Traders To See Where the Money Flows(The 5 Minute Wrapup)

Apr 17, 2019

20% of all the traders bring in 80% of the money. Watch these 20% and you get a working idea of which way the wind is blowing.

The Best Trading Strategy in the World(Profit Hunter)

Apr 15, 2019

It's our great pleasure to introduce Vijay Bhambwani to our readers - we consider Vijay to be India's best trader. Read on to find out why...

A Letter to You from India's No. 1 Trader(The 5 Minute Wrapup)

Apr 15, 2019

It's our great pleasure to introduce Vijay Bhambwani to our readers - we consider Vijay to be India's best trader. Read on to find out why...

Election Series: Why 'Liquor' is so Important to the Elections(The 5 Minute Wrapup)

Apr 19, 2019

When elections come around, liquor flows like water and everyone gets drunk with power...what does this mean for liquor stocks? Read one to find out from our very own election trading analyst, Vijay Bhambwani.

More

Get the Indian Stock Market's
Most Profitable Ideas

How To Beat Sensex Guide 2019
Get our special report, How to Beat Sensex Nearly 3X Now!
We will never sell or rent your email id.
Please read our Terms

BALAJI TELEFILMS SHARE PRICE


Apr 26, 2019 (Close)

TRACK BALAJI TELEFILMS

  • Track your investment in BALAJI TELEFILMS with Equitymaster's Portfolio Tracker. Set live price alerts, get research alerts and more. Get access now...
  • Add To MyStocks

MORE ON BALAJI TELEFILMS

BALAJI TELEFILMS - D. B. CORP COMPARISON

COMPARE BALAJI TELEFILMS WITH

MARKET STATS