Better days to come: Hum Network stock drops 20% in June
Advertising revenues expected to head north in fourth quarter.
KARACHI:
Hum Network Limited has recently fallen out of favour of investors as stock price declined 20 per cent in June.
Hum witnessed 15 per cent drop in advertising revenues during the third quarter of fiscal 2011 on a quarterly basis, however the declines are expected to be temporary, according to a BMA Capital.
Decline in the stock price presents an opportunity for investors to take a position in the stock as revenues are expected to head upwards, says a BMA Capital research note.
The organisation was unable to increase its tariff rates during the quarter as marketing budgets were preferably directed to sports channels as a result of the Cricket World Cup 2011 during the period under review.
The ongoing quarter is expected to post 15 per cent improvement in sales to Rs357 million on the back of higher marketing spending by advertisers of beverages and ice creams during the prevailing summer season, bridal couture week in Karachi which attracted fashion advertisers in particular and improved ratings of HUM TV series, says the note.
Moreover, increasing popularity of shows aired on Style 360 and Masala TV – other channels of Hum Network – is attracting greater number of advertisements for the respective audiences, adds the note.
Higher revenues combined with cost control measures are expected to improve Hum’s earnings by 32 per cent to Rs47 million in the fourth quarter against Rs36 million in the third quarter. This would take the full year net profit to Rs184 million, down by 10 per cent against the preceding year.
Published in The Express Tribune, June 23rd, 2011.
Hum Network Limited has recently fallen out of favour of investors as stock price declined 20 per cent in June.
Hum witnessed 15 per cent drop in advertising revenues during the third quarter of fiscal 2011 on a quarterly basis, however the declines are expected to be temporary, according to a BMA Capital.
Decline in the stock price presents an opportunity for investors to take a position in the stock as revenues are expected to head upwards, says a BMA Capital research note.
The organisation was unable to increase its tariff rates during the quarter as marketing budgets were preferably directed to sports channels as a result of the Cricket World Cup 2011 during the period under review.
The ongoing quarter is expected to post 15 per cent improvement in sales to Rs357 million on the back of higher marketing spending by advertisers of beverages and ice creams during the prevailing summer season, bridal couture week in Karachi which attracted fashion advertisers in particular and improved ratings of HUM TV series, says the note.
Moreover, increasing popularity of shows aired on Style 360 and Masala TV – other channels of Hum Network – is attracting greater number of advertisements for the respective audiences, adds the note.
Higher revenues combined with cost control measures are expected to improve Hum’s earnings by 32 per cent to Rs47 million in the fourth quarter against Rs36 million in the third quarter. This would take the full year net profit to Rs184 million, down by 10 per cent against the preceding year.
Published in The Express Tribune, June 23rd, 2011.