InvestorQ : Why has the stock of Network 18 rallied so sharply in the last few days?
Arti Chavan made post

Why has the stock of Network 18 rallied so sharply in the last few days?

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Rutuja Nigam answered.
5 months ago
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The stock of Network18 Media & Entertainment, which is part of the Reliance Group, has hit an 11-year high of Rs.102.75, in the midst of heavy volumes on the stock counter. The stock has surged as much as 42% in the last 4 days and the current price was last seen in the year 2011. Network 18 is principally engaged in digital news and publishing and the TV18 channel network is a subsidiary of Network 18.

The stock doubled in the last 3 months after it reported a strong 53% YoY growth in EBITDA at Rs.253 crore. For the Sep-21 quarter, even the OPM or operating profit margin improved sharply by 260 basis points from 15.6% to 18.2%. This was largely driven by growth in viewership driving up top line sales. Markets are betting on Viacom acquiring rights to FIFA World Cup’22 as well as 3 major football leagues.

Network 18 has also seen favourable working capital changes which has led to a sharp fall in debt. Clearly, the incremental investment into content and distribution have paid off big time for the stock.

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