New Delhi: Kalanithi Maran-owned Sun TV Network Ltd posted a 9.7% increase in net profit for the quarter to June, driven by an increase in advertising and subscription revenue.
Net profit rose to Rs187.62 crore from Rs170.95 crore in the year earlier. Sales rose to Rs453.99 crore from Rs440.44 crore.
The return of J. Jayalalithaa as chief minister of Tamil Nadu in May didn’t make a dent on earnings. Jayalalithaa has pushed for the prosecution of Dayanidhi Maran, brother of the Sun TV boss, and her government has taken action against the company’s officials.
Tuned in : Sun Network’s Kalanithi Maran.
The state government has said it wants to nationalize the cable TV business in the state and revive state-owned Arasu Cable Corp. formed in 2008 by the Karunanidhi government, as part of this effort. That would erode the near monopoly of Sumangali Cable Vision, a Sun TV subsidiary.
“There is no impact on the company’s performance this quarter, even after Jayalalithaa came to power,” said a media analyst who did not want to be named. “The effect might be seen in the second or third quarter when cable television is nationalized.”
Sun TV runs a bouquet of 20 television channels in the four southern Indian languages and has 48 FM radio stations.
“They are the leaders in the regional space, so there wouldn’t be any problem as long as advertising continues to grow,” said Jehil Thakkar, partner, media and entertainment at consulting firm KPMG India Pvt. Ltd. “There is no sign of losing viewership at Sun TV and if it is maintained, there wouldn’t be any problem whatsoever.”
Sun TV’s consolidated earnings before interest, tax, depreciation and amortization (Ebitda)—a measure of operating profitability—rose to Rs365.92 crore from Rs359.90 crore.
The stock fell 3.68% to Rs309.75 on the Bombay Stock Exchange on Monday. The benchmark Sensex rose 0.64% to 18,314.33.
On 13 July, the Tamil Nadu police questioned Kalanithi Maran on a case against close aide Hansraj Saxena, COO of Sun Pictures, who has been arrested on charges of cheating and intimidating business associates.
Saxena was arrested on 3 July on charges of cheating and breach of trust, based on a complaint by film distributor T.S. Selvaraj of Salem-based Kandan Films. Saxena allegedly delayed paying back Rs82.53 lakh to Selvaraj.
Sun Pictures is a unit of Sun TV Network. Saxena has also been charged in two other cases.