HINDUSTAN MEDIA VENTURES LTD - CONSISTENT GROWTH

  

   

Financial muscle of many companies badly affected due to prolonged recession of our economy in last few years. A cut in advertisement cost was the first initiative taken by many companies to combat with this situation. Because of this reason , performance of many media companies were muted in recent past. At the time of some revival in offing let us look into one media company which not only survived but continuously improved its business and surprisingly with improvement in profit margins too in past for years.

HINDUSTAN MEDIA VENTURE ( HMVL)  – is the company publishing famous Hindi daily “HINDUSTAN” which is currently standing at the second position(all India basis)  in all Hindi dailies,  next to Dainik Jagran ( As per IRS Survey 2013) and the fastest growing Hindi Daily .Company also publishing two monthlies – Kadambini (Cultural and Literacy magazine)  and Nandan (exclusively for children) and running Hindi news website LiveHindustan.com. Since the business is simple and easy to understand, I am not explaining much about that side. At present “Hindustan” is publishing from 19 locations and at the top position in Bihar and Jharkand . As in the case of any daily , company’s income is coming through subscription charges and advertisement income. Almost 2/3 part of income is coming from advertisement and the rest from subscription charges. In developed countries print media industry is showing negative growth trend due to increasing popularity of  Internet and mobile. But in India , print media is growing at a healthy pace and considering the huge population of currently illiterate and non techno savvy people, growth is expected to continue for many more years. Government’s sincere efforts for illiteracy eradication programmes will positively impact the growth of print media in India in coming years.In order to capitalize any shift of trend in future ,company already entered in web based business through its news website LiveHindustan.com.

Among the many listed media companies , Hindustan Media Venture catching our attention mainly due to the strength of its balance sheet and the resilience it showing during tough business environment. For the last four years company reported steady growth by all parameters and such a growth during the most tough  business environment is really commendable. During this period HMVL ‘s bottom line expanded from Rs.53 Cr to Rs.111 Cr ( More Details in the below Table)

 

                                  
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Promoters are holding about 75 % stake in HMVL and another 13 % by mutual funds and big investors .Company’s balance sheet is strong with negligible debt and robust operating cash flow . In addition to this, about Rs.400 Cr available as Cash or cash equivalents with the company  . Company can use this huge amount for growth  either through organic or  inorganic expansion or reward its stake holders through share buy back ..etc in future . Considering the strong growth in circulation, possibility of increase in advertisement charges  going forward , stability in raw material cost and above all a very strong balance sheet ,HMVL remaining as one of the preferred pick from media space and I believe  there is lot of value in it and suitable even for law risk investors who are ready to show patience for steady growth.

Hindustan Media Venture ( HMVL) is listed in both exchanges and trading around Rs.187.

    
Link to Company website HERE

Link to Latest  Annual Report HERE

Disc: It is safe to assume that I have vested interest in HMVL