Confident of doing much better in FY22 than last year: Sun Group’s SL Narayanan

Sun TV posted its Q4FY21 earnings. Ad revenues have come in well above estimates, but dividend payout at just Rs 5 per share is at the lowest level since FY10. SL Narayanan, Group CFO, Sun Group, discussed the results and road ahead.

“We are quite confident now. We should be doing a lot better than last year,” he said in an interview with CNBC-TV18.

The lockdown of 2021 is not as unforgiving as the lockdown of 2020. From a 65 percent drop, we reduced to 9 percent drop by December, and in the March quarter, we posted 8 percent growth. We could have continued on this trendline, but for the unfortunate happenings of April and May – which were a bit of a dampener but it feels a lot different than what it was same time, last year,” he added.

On dividend, he stated, “I don’t think there is a better company than Sun TV in the media space when it comes to distribution of cash. If I take FY11 to FY20, the company has paid around Rs 5,700 crore in dividends. Barring a couple of years in between, where we were conserving cash for our potential M&A opportunity, we have consistently paid more than 50 percent of profit after tax (PAT

“The Board is extremely obsessed with maintaining a high return on equity – it has always been around 30 percent,” he further mentioned.

In terms of digital, he stated, “We are one of the biggest buyers of satellite rights and more importantly, we are now going into digital rights. So, we have been extremely busy holding up our plans for beefing up the catalogue and the content library. We have always been spending anywhere between Rs 400 -Rs 500 crore for buying broadcast rights for both, satellite and digital. So that number can happen once things normalize.”

When asked for his plans on OTT, he replied, “We are having a lot of movie content for OTT because in this part of the world, movies seem to be driving demand more than the typical web series, thrillers. I personally believe that this particular market is very niche. To put an extraordinary investment of our capex into a niche market at this stage, the business is not very strong there. That is the reason why our focus will be on mainline television.”