NETWORK18 - Fundamental Analysis: Financial Health & Valuation

Last Updated Time : 20 Dec 25, 11:16 pm

Fundamental Rating: 2.0

📊 Financials: Network18 shows weak fundamentals with negative ROE (-9.29%) and ROCE (-1.20%), reflecting poor efficiency and profitability. Debt-to-equity ratio of 0.63 indicates moderate leverage. EPS is reported at ₹24.7, but profitability remains negative with PAT at -₹70.1 Cr. compared to -₹70.8 Cr. in the previous quarter. Dividend yield is 0%, offering no income support.

💹 Valuation: No meaningful P/E ratio due to negative earnings. Book value of ₹33.2 gives a P/B ratio of ~1.26, suggesting fair valuation relative to assets. PEG ratio is unavailable, reflecting lack of growth visibility. Intrinsic value appears lower than current price, offering limited margin of safety.

📺 Business Model: Network18 operates in media and broadcasting, with exposure to television, digital, and publishing. Competitive advantage lies in diversified media presence and brand recognition, though profitability challenges and industry competition weigh heavily.

📈 Entry Zone: Current price ₹42 is near support at ₹39.6. Entry zone recommended only for speculative investors between ₹38–42. Long-term holding is not advised until profitability stabilizes and efficiency metrics improve.

Positive

• 📌 Trades close to book value (P/B ~1.26)
• 📌 Slight improvement in quarterly PAT (-₹70.8 Cr. to -₹70.1 Cr.)
• 📌 RSI at 26.7 indicates oversold momentum, potential for short-term technical bounce

Limitation

• ⚠️ Negative ROE (-9.29%) and ROCE (-1.20%) indicate poor efficiency
• ⚠️ Persistent losses with negative PAT
• ⚠️ Dividend yield is 0%, offering no income support
• ⚠️ Current price below DMA 50 (₹46.3) and DMA 200 (₹53.1), showing bearish trend

Company Negative News

• 📉 Continued quarterly losses (-₹70.1 Cr.)
• 📉 Decline in both FII (-0.31%) and DII (-0.07%) holdings

Company Positive News

• 📈 Marginal improvement in quarterly PAT compared to previous quarter
• 📈 Strong brand presence in diversified media platforms

Industry

• 📺 Media and broadcasting sector faces intense competition and digital disruption
• 📺 Industry P/E at 39.2 highlights Network18’s weak relative valuation due to losses

Conclusion

❌ Network18 is financially weak with negative returns, persistent losses, and no dividend support. Entry only for speculative investors around ₹38–42. Long-term holding is not recommended until profitability improves and efficiency metrics turn positive.

Would you like me to extend this into a peer benchmarking overlay comparing Network18 with other listed media companies, or a basket scan to identify safer opportunities in the communications and entertainment sector?