The Hindu Business Line : TV Today bounces back

TV Today Network Ltd stock on Friday bounced back, from its trough recorded on Thursday at Rs 121.25 since listing, on improvement of a sectoral outlook following the recent optimism generated at the media conclave "Frames 2004" in Mumbai.

Dealers also attributed renewed interest to substantial acquisition by an overseas fund.

The stock recovered by 9.21 per cent at Rs 132.85. The increase in traded quantity also suggested a strong demand push, particularly in the early hours of trading. On the NSE, there were 16 block deals, struck between 10 and 11 am, in the range of Rs 134 - Rs 141. Total volume in the counter on the NSE shot up to 12.09 lakh (1.37 lakh) shares. The BSE saw 3.88 lakh (46,753) shares changing hands.

According to Mr Ajay Jaiswal of Lohia Securities, the news that Templeton Asset Management recently picked up around 26.70 lakh shares of the company for 15 of its schemes has attracted market attention. The total acquisition represents 5.56 per cent stake in TV Today. "With elections round the corner, the new media counter is back in the value investors' radar as it may increase viewing, TRP rating and ad revenue".

However, according to Mr Pradip Hotchandani, considering the earnings per share, the stock seems a little overvalued at the current level.

"The present EPS was Rs 18.90. The stock has so far seen its peak at Rs 225. Though the Hindi channel of the company is reported to be doing well, the English channel has a lot to improve in terms of viewership increase and profitability", some analysts felt.

But as the media sector is projected to grow by around 20 per cent annually in the near future and the number of listed companies in the sector is just handful, valuation and demand for the media stocks currently tend to be disproportionate to their present earnings, a media stock analyst with an institutional brokerage house observed.