Sun TV posts lower profits despite ad growth
Sun TV posts lower profits despite ad growth
Chennai: Sun TV Network Ltd on Friday ported that net profit declined to ₹ 164.31 crore, down 12.42% from ₹ 187.64 crore a year earlier.
Income from operations at the Kalanithi Maran-promoted firm also saw a decline of 6.2% to ₹ 425.75 crore posted lower profit despite growth in advertisement revenue.
“Higher cost is a cause of concern, the cost had gone up due to non-fiction shows and such will be required due to competition from other players, the subscription revenues from Arasu Cable should be able to offset the higher costs," said Abneesh Roy, an analyst with Edelweiss Securities Ltd.
Advertisement revenue rose 5% to ₹ 242.8 crore, reversing the trend seen in recent quarters.
Total income, however, fell to ₹ 438.98 crore from ₹ 471 crore because of a drop in cable revenue in Tamil Nadu. This will start increasing from 1 August, following Sun TV’s pact with state-run Arasu Cable to distribute its channels, said a company release.
“The deal will aid both subscription and ad revenue, though gradually," said a report from brokerage Edelweiss Securities.
Maran and his brother Dayanidhi Maran are embroiled in a scandal over alleged wrongdoing related to 2G spectrum.
Sun TV fell 0.26% to ₹ 271.10 on BSE on Friday as the benchmark Sensex dropped 0.15% to 17,197.93 points.
leena.s@livemint.com
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