Beta Analysis and Ratio Analysis of Stocks in Media and Entertainment Sector - Balaji Telefilms, Warner Bros, TIPS Industries, Zee Telefilms, Walt Disney, Mukta Arts

1. Presented to Dr. Kumar Bijoy By –
Mohit Bhalla 75234
Nimit Jain 75235
Rahul Nirwan 75245
Sahil Chaudhry 75251
Shaheed Sukhdev College of Business Studies
University of Delhi
1

2. 2

3. 3

4. BALAJI TELEFILMS LIMITED
Industry
Entertainment
Founded
1994
Founder(s)
Jeetendra
Headquarters
Mumbai, India
Key people
Ekta Kapoor and Shobha Kapoor
Products
Television programs, Motion
pictures
Subsidiaries
Balaji Motion Pictures
ALT Entertainment
Website
www.balajitelefilms.com
4

5. COMPANY BACKGROUND
• Balaji Telefilms Private Limited incorporated on 10th November 1994, at
Mumbai. Converted into a Public Limited Company on 29th February 2000
and Subsequently its name was changed to Balaji Telefilms Ltd on 19th April
2000.
• Promoted by Ekta Kapoor, Shobha Kapoor, Jeetendra and Tushar Kapoor.
•
Largest television production house in South Asia, Southeast Asia and the
Middle East.
• Diversified itself into all the 4 screens by bringing in new teams for the
motion pictures, internet and mobile space.
5

6. 1.40
1.20
BETA
CORRELATION
ANALYSIS
1.00
0.80
0.60
0.40
0.20
0.00
2003- 2004- 2005- 2006- 2007- 2008- 2009- 2010- 201104
05
06
07
08
09
10
11
12
SENSEX BETA
0.99
1.02
0.48
0.77
0.48
0.68
1.14
1.11
1.01
SENSEX CORRELATION
0.39
0.46
0.20
0.43
0.27
0.43
0.51
0.43
0.44
NIFTY BETA
0.93
0.97
0.52
0.76
0.53
0.68
1.24
1.10
1.00
NIFTY CORRELATION
0.40
0.49
0.22
0.43
0.31
0.41
0.57
0.44
0.45
Combined SENSEX Correlation 0.41
Combined NIFTY correlation
0.42
0.41
0.41
0.41
0.41
0.41
0.41
0.41
0.41
0.42
0.42
0.42
0.42
0.42
0.42
0.42
0.42
Combined SENSEX Beta
0.82
0.82
0.82
0.82
0.82
0.82
0.82
0.82
0.82
Combined NIFTY Beta
0.83
0.83
0.83
0.83
0.83
0.83
0.83
0.83
0.83
6

7. 3.0000
2.5000
2.0000
1.5000
1.0000
STDEV(BSE
PRICES)/STDEV(SENSEX)
STDEV(NSE
PRICES)/STDEV(NIFTY)
0.5000
0.0000
7

8. COMPARISON WITH SENSEX
25000
20000
15000
SENSEX
10000
BSE Prices
5000
0
8

9. DEBT EQUITY RATIO
1
0.9
0.8
0.7
0.6
0.5
Debt Equity Ratio
0.4
0.3
0.2
0.1
0
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
9

10. EPS, PRICE EARNING RATIO ANALYSIS
40
20
0
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
-20
Price Earning Ratio
EPS
-40
-60
-80
10

11. PROFIT AFTER TAX (₹ lakhs)
10000
8793
8000
7943
6000
5942
5541
4000
4130
pat(lakhs)
2667
2000
1519
0
-2000
1161
-340
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
11

12. NET WORTH V/S NET OWNED FUNDS ANALYSIS
450.00
401.78 396.86 406.95
388.88
400.00
364.85
350.00
304.16
300.00
250.00
250.47
213.13
200.00
Networth
Net owned Funds
150.00
144.38
100.00
50.00
0.00
12

13. BOOK VALUE:MARKET VALUE
2.000
1.845
1.800
1.600
1.525
1.400
1.200
1.188
1.000
0.970
0.862
0.800
BV:MV
0.600
0.400
0.200
0.233
0.303
0.227
0.131
0.000
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
13

14. CURRENT RATIO
6
5.09
5
4.19
4
3.43
3
2
4.36
3.39
3.12
current ratio
2.22
1.9
1.83
1
0
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
14

15. REALIZATION PER HOUR (₹ LAKHS)
35
32.75
30
29
27.6
25
22.22
20
17.7
15
15
18.3
19.5
16.7
realization per hour (₹ lac)
10
5
0
15

16. 16

17. MUKTA ARTS LIMITED
[1][2]
Type
Public
Industry
Entertainment
Founded
28 October 1978
Ghai
Headquarters
Mumbai, India
Key people
Subhash Ghai (Chairman and
Managing Director)
Nadish Bhatia (VP
Marketing, Sales and Syndication)
Rahul Puri (Executive Director)
[4]
Swapna Jadhav (HR Manager)
Website
Mukta Arts
[3]
by Subhash
17

18. COMPANY BACKGROUND
• Mukta Arts is an Indian film production company. It operates as an entertainment
company that primarily produces motion pictures.
• Founded by Mr. Subhash Ghai, one of India’s most successful film directors, the company
has a library of over 35 hit films and has a brand that is globally recognized with quality
and entertainment.
• The company is also involved in the production, distribution, and exhibition of television
serials and entertainment software; equipment hiring; and generation and distribution of
contents for the entertainment industry.
• In addition, the company is involved in the hire of equipment, such as generator vans,
cameras with hawk lens, lights, grip equipment, remote control cranes, and location sync
sound systems.
• Further, it operates the Whistling Woods International Institute, an education, research,
and training institute that imparts training in skills related to films, television, and media
industry.
18

19. 1.20
BETA
CORRELATION
ANALYSIS
1.00
0.80
0.60
0.40
0.20
0.00
2003- 2004- 2005- 2006- 2007- 2008- 2009- 2010- 201104
05
06
07
08
09
10
11
12
SENSEX BETA
0.91
0.80
0.50
0.68
1.01
0.46
0.56
0.93
0.55
SENSEX CORRELATION
0.35
0.40
0.21
0.33
0.44
0.32
0.28
0.39
0.23
NIFTY BETA
0.91
0.77
0.51
0.70
0.91
0.52
0.54
0.80
0.63
NIFTY CORRELATION
0.37
0.43
0.21
0.35
0.43
0.33
0.27
0.32
0.24
Combined SENSEX Beta
0.67
0.67
0.67
0.67
0.67
0.67
0.67
0.67
0.67
Combined NIFTY Beta
0.68
0.68
0.68
0.68
0.68
0.68
0.68
0.68
0.68
Combined SENSEX Correlation 0.32
Combined NIFTY Correlation
0.33
0.32
0.32
0.32
0.32
0.32
0.32
0.32
0.32
0.33
0.33
0.33
0.33
0.33
0.33
0.33
19
0.33

20. COMPARISON WITH SENSEX
25000
20000
15000
SENSEX
10000
BSE PRICES
5000
0
20

21. EPS PRICE EARNING RATIO ANALYSIS
60.000
50.000
50.767
40.000
36.157
30.302
30.000
EPS
Price Earning Ratio
20.000
11.320
10.000
6.050
0.000
1.500
0.000
0.000
8.466
5.770
1.820
3.269
0.000
0.000
21

22. NET WORTH V/S NET OWNED FUNDS ANALYSIS
180.00
160.00
140.00
120.00
100.00
Networth
80.00
Net owned Funds
60.00
40.00
20.00
0.00
2003-042004-052005-062006-072007-082008-092009-102010-112011-12
22

23. PROFIT AFTER TAX (₹ CRORES)
30
25.57
20
13.71
13.03
10
4.1
3.39
0
PAT(cr)
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
-5.64
-6.16
-10
-16.97
-20
-24.25
-30
23

24. CURRENT RATIO
4.00
3.54
3.50
3.02
3.00
3.03
2.72
2.50
2.48
2.07
2.00
1.50
2.22
current ratio
1.63
1.37
1.00
0.50
0.00
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
24

25. DEBT EQUITY RATIO
0.800
0.726
0.700
0.600
0.500
0.498
0.400
0.353
Debt Equity Ratio
0.300
0.223
0.200
0.100
0.000
0.099
0.002
0.121
0.090
0.002
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11 2011-12
25

26. 26

27. At a Glance:
 Industry: Broadcasting & Cable
 Founded: 1923
 Country: United States
 CEO: Robert Iger
 Website: corporate.disney.go.com
 Employees: 156,000
 Sales: $40.96 B
 Headquarters: Burbank, California
27

28. Beta
-0.09707
Beta 03-04
Beta 04-05
Beta 05-06
Beta 06-07
Beta 07-08
Beta 08-09
Beta 09-10
Beta 10-11
Beta 11-12
Beta 12-13
0.26469
0.01041
-0.05120
0.04294
-0.30229
-0.09099
-0.17204
-0.02868
-0.07731
0.00724
Price Correlation
Return Correlation
Coefficient of determination - Price
Coefficient of determination - Return
0.81572
-0.063391628
66.54%
0.40%
28

29. Beta
0.30000
0.20000
0.10000
0.00000
Beta
-0.10000
-0.20000
-0.30000
-0.40000
29

30. DOW JONES
16000.00
14000.00
12000.00
10000.00
8000.00
DOW JONES
6000.00
4000.00
2000.00
0.00
2/3/03
2/3/04
2/3/05
2/3/06
2/3/07
2/3/08
2/3/09
2/3/10
2/3/11
2/3/12
Walt Disney
60
50
40
30
Walt Disney
20
10
30
0
2/3/03
2/3/04
2/3/05
2/3/06
2/3/07
2/3/08
2/3/09
2/3/10
2/3/11
2/3/12

31. 60
Walt Disney
40
4 Feb, 2004:
Comcast
hostile
30
takeover bid
50
20
Walt Disney
10
0
2/3/03
2/3/04
2/3/05
2/3/06
2/3/07
2/3/08
2/3/09
2/3/10
2/3/11
2/3/12
The past several years were influenced by
the horror of
9/11, a worldwide
recession, two wars, a downturn in
tourism, an unsolicited and below market
offer by Comcast to buy your Company and
an unusually intense publicity campaign
against the Board and management by two
dissident former directors. As we
confronted this confluence of events we
were resolute in keeping our focus on the
operations of the Company and returning to
the kind of stellar performance our
shareholders expect of us. I am exceedingly
proud of our management team and entire
Cast, who not only kept the Company on
course
throughout
this
challenging
period, but were able to deliver the
phenomenal results it did as the turbulence
began to subside.
31

32. 60
Walt Disney
Financial
50
Downturn
40
30
20
Walt Disney
10
0
2/3/03
2/3/04
2/3/05
2/3/06
2/3/07
At the same time, we faced a
severe
global
economic
downturn and an acceleration of
secular challenges that affect
several of our key businesses.
Earnings per share for the
year, excluding certain items
affecting comparability between
years (1), fell by 20% to $1.82
from the record $2.28 we
reported in fiscal year 2008.
Revenues were down 4% to
$36.1 billion.
-Page 3, 2009 Annual Report
2/3/08
2/3/09
2/3/10
2/3/11
2/3/12
32

33. 60
Walt Disney
Record Income
50
40
30
20
Walt Disney
10
0
2/3/03
2/3/04
2/3/05
2/3/06
2/3/07
2/3/08
For the second year in a row Disney
achieved record net
income, revenue, and earnings per
share. In fiscal 2012, net income for
our shareholders was a record $5.7
billion, an increase of 18% over last
year, and revenue was a record
$42.3 billion, up 3% from last year.
Diluted earnings per share
increased 24% to a record $3.13.
-Page 3, 2012 Annual Report
2/3/09
2/3/10
2/3/11
2/3/12
Disney’s second-quarter sales
gained 6.1 percent to $9.63
billion, beating projections of $9.56
billion.
Theme-park operating profit leapt
53 percent to $222 million on a 7
percent increase in domestic
attendance and higher average
room rates worldwide. Revenue
soared 10 percent at the namesake
resorts to $2.9 billion, driven by
gains in the U.S., Tokyo and Hong
Kong.
33

34. DOW JONES
15000.00
10000.00
5000.00
0.00
2/3/03
2/3/04
2/3/05
2/3/06
2/3/07
2/3/08
2/3/09
2/3/10
2/3/11
2/3/12
DOW JONES
Walt Disney
60
50
40
30
20
10
0
2/3/03
Walt Disney
2/3/04
2/3/05
Beta
0.26469
0.01041
-0.05120
0.04294
-0.30229
-0.15467
-0.17204
-0.02868
-0.07731
0.00724
2/3/06
2/3/07
2/3/08
Year
2003-04
2004-05
2005-06
2006-07
2007-08
2008-09
2009-10
2010-11
2011-12
2012-13
2/3/09
2/3/10
2/3/11
Correlation
0.94956
0.68205
0.14811
0.91533
0.26214
0.90163
0.96973
0.78755
0.82355
0.57429
2/3/12
34

35. DE Ratio
0.6
.548
0.5
0.4
.332
0.3
DE Ratio
0.2
0.1
35
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

36. DE Ratio
0.6
0.5
0.4
2003-2004: Debt is
between $ 13.0513.48 B.
Only Equity
increased. $23.8 to
31 B; due to
retained earnings
from subsequent
movies/shows.
0.3
DE Ratio
0.2
0.1
36
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

37. DE Ratio
0.6
Money borrowed
for $7.5 billion
acquisition
of
Pixar.
0.5
0.4
0.3
DE Ratio
0.2
0.1
37
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

38. DE Ratio
0.6
0.5
The company took
advantage
of
the
interest rate environment, locking in low
fixed rates on over
80% of its net debt
portfolio as of the end
of fiscal year 2006.
-Page
16,
Annual
Report 2006
0.4
0.3
DE Ratio
0.2
0.1
38
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

39. 0.6
DE Ratio
0.5
0.4
0.3
0.2
The decrease in
interest
expense
was primarily due
to lower effective
interest rates and
lower average debt
balances, partially
offset by expense
related to the early
redemption of a
film
financing
borrowing.
-Page 44, Annual
Report 2010
0.1
39
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012

40. Share Price (NYSE)
60
50
40
30
Share…
20
10
0
60
50
40
30
20
10
0
4
3
2
1
0
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Book Value
Market Value
MV:BV
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
MV:BV
40
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012

41. 1.4
1.2
1
0.8
0.6
CR
The Current Assets
remained almost the
same, however, due to
having been locked in
lower fixed rates
recently, the current portion
of liabilities was
significantly lesser.
0.4
0.2
Hence, CL were lesser than
in years before and after.
0
41

42. Year
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
CR
0.958477509
0.844144144
0.965103599
0.937254902
0.99122807
1.00862069
1.332586786
1.109090909
1.140495868
1.0703125
Current
Assets Current
(in B$) Liabilities
(in B$) (in B$)
8.31
8.67
9.37
11.1
8.85
9.17
9.56
10.2
11.3
11.4
11.7
11.6
11.9
8.93
12.2
11
13.8
12.1
13.7
12.8
42

43. EPS
=Profit after Tax/OS Shares
3
Financial
Crisis
2.5
2
Hostile
Merger Bid
1.5
EPS
1
0.5
2012
2011
2010
2009
2008
2007
2006
2005
2004
2003
0
43

44. 2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
60
50
40
PE Ratio
=MV/EPS
30
MV
20
10
EPS
0
44

45. 45

46. Zee Entertainment Enterprises Ltd
Industry :Entertainment & Media
Business Group
Essel Group
Sector
Entertainment
Incorporation Year
1982
Incorporation Date
25-Nov-1982
Chairman
Subhash Chandra
46

47. 





The company was launched on 15 December 1991 and was previously
known as Zee Telefims until 2006.
Zee currently operates over 15 different television channels, a cable
company SitiCable, a record label Zee Records, a production company
and has expanded operations abroad in the UK and U.S. as well as Africa
and Asia.
In 2002 Zee Entertainment Enterprises acquired a majority stake (51%)
in ETC Networks.
In 2006, they acquired Integrated Subscriber Management Services
Limited and in November 2006, Zee acquired an interest (50%) in Taj
television TEN Sports.
In February 2010 Zee Entertainment Enterprises acquired an additional
stake (95%) in TEN Sports.
As Zee Telefilms, the company formed part of BSE Sensex from 20002005.
47

48. Beta Analysis with BSE Sensex
Beta Analysis with NSE Nifty
Beta 2002-2012
0.74
Beta 2002-2012
0.78
Beta 2003
1.18
Beta 2003
1.11
Beta 2004
0.75
Beta 2004
0.71
Beta 2005
0.91
Beta 2005
0.92
Beta 2006
0.68
Beta 2006
0.79
Beta 2007
1.01
Beta 2007
1.03
Beta 2008
0.65
Beta 2008
0.67
Beta 2009
0.68
Beta 2009
0.79
Beta 2010
0.84
Beta 2010
1.11
Beta 2011
0.51
Beta 2011
0.51
Beta 2012
0.57
Beta 2012
0.56
48

49. 25000
250
Zee and Sensex
Generally consistent movement with the
Index as documented by Beta of 0.78
20000
200
15000
150
10000
100
5000
Issue of
Bonus
Shares 1:1
and ESPS
50
11/11/10
0
0
49

50. 50
Key Figures
Total
Year Debt
Net
Worth
No. of
Shares
Net Owned
Funds
D/E
Ratio
Current
Ratio
Quick
Ratio
PE
Ratio
Market
Price
Book
Value
EPS
2003
404.36 3906.68
41
2996.80
0.10
1.53
1.20
27.29
62.50
94.73 2.29
2004
268.01 2046.56
41
2904.70
0.13
1.95
1.50
46.76
134.20
49.63 2.87
2005
526.71
2136.75
41
2944.23
0.25
3.10
2.66
35.34
138.90
51.81 3.93
2006
484.21 1544.94
41
2513.95
0.31
2.20
1.85 142.78
238.45
37.45 1.67
2007
254.05
1935.17
43
2332.51
0.13
1.73
1.50
65.44
250.65
44.63 3.83
2008
204.26
2128.25
43
2189.22
0.10
2.09
1.60
35.93
244.65
49.08 6.81
2009
170.95
2343.00
43
2029.15
0.07
2.84
1.75
14.88
106.25
53.99 7.14
2010
118.90
2819.83
43
2663.46
0.04
2.93
1.81
20.85
268.60
64.9712.88
2011
1.10 2903.60
98
2314.57
0.00
3.71
2.03
21.00
123.70
29.69 5.89
2012
1.70 2995.10
96
4311.04
0.00
4.14
2.25
24.77
126.55
31.23 5.11

51. D/E Ratio
0.35
Acquisition of
Controlling
Stake in ETC
Network
0.31
0.30
0.25
0.25
Repayment of
Loans and
restructuring of
subsidiaries
0.20
0.15
Systematic
repayment of
loans
0.13
0.13
0.10
D/E Ratio
0.10
0.10
0.07
0.04
0.05
0.00
0.00
2003
2004
2005
2006
2007
2008 2009
2010
0.00
2011
2012
51

52. 4.50
Big Boom in
advertising
revenue as a result
of highest TRPs
4.00
Current Ratio and Liquid Ratio
Purchase of High
Price
Programming
Rights
52
4.14
3.71
3.50
Drastic fall in
advertising rates
as a result of fall
in TRP
3.10
3.00
2.93
2.66
2.50
2.20
2.00
1.50
2.84
1.95
1.53
1.85
1.50
2.25
2.09
1.73
1.50
1.60
2.03
1.75
1.81
1.20
1.00
0.50
0.00
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012

53. 100.00
14
94.25
90.00
12
80.00
70.00
Heavy capital
expenditure to
acquire ETC
Networks
10
70.01
60.00
8
50.26
50.00
EPS
6
40.00
37.81
36.65
30.00
PE Ratio
4
26.04
28.03
22.14
20.00
22.21
15.63
2
10.00
0.00
0
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
53

54. 54

55. Beta Analysis with BSE Sensex
Beta Analysis with NSE Nifty
Beta
0.88
Beta
0.89
Beta 2003
Beta 2004
Beta 2005
Beta 2006
Beta 2007
Beta 2008
Beta 2009
Beta 2010
Beta 2011
Beta 2012
1.04
0.88
1.10
0.93
0.84
0.94
0.68
1.22
0.97
0.24
Beta 2003
Beta 2004
Beta 2005
Beta 2006
Beta 2007
Beta 2008
Beta 2009
Beta 2010
Beta 2011
Beta 2012
1.06
0.86
1.08
1.02
0.79
0.94
0.68
1.22
0.96
0.27
55

56. 1.40
Beta Movement
1.20
1.00
0.80
Yearly Sensex Beta
Yearly Nifty Beta
0.60
Combined Sensex Beta
Combined Nifty Beta
0.40
0.20
0.00
Beta Beta Beta Beta Beta Beta Beta Beta Beta Beta
2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
56

57. Tips Industries Ltd.
25000
140
120
20000
100
15000
10000
80
60
40
5000
20
0
0
57

58. Key Figures
Book Value
Year Net Worth (crores) No. of Shares (Crores) (1)
Market Value MV:BV
58
Total Debt Beta
Debt:Beta Ratio
2012
84.58
1
84.58
55.1 0.651454
39.97 1.03565
38.59429056
2011
79.48
1
79.48
26.53 0.333795
53.82 0.88458
60.8422507
2010
85.22
1
85.22
41.77 0.490143
54.67 1.09950
49.72275673
2009
79.27
1
79.27
25.85 0.326101
56.74 0.92604
61.27165943
2008
70.05
1
70.05
57.32 0.818273
11.99 0.84241
14.23292171
2007
43.48
1
43.48
28.41 0.653404
29 0.94150
30.80200898
2006
32.6
1
32.6
31.38 0.962577
10.93 0.67694
16.14628801
2005
63.5
1
63.5
30.84 0.485669
8.05 1.21858
6.606068407
2004
71.41
1
71.41
28.19 0.394763
8.82 0.96953
9.097207704
2003
64.84
1
64.84
29.54 0.455583
7.74 0.23705
32.65183802

59. Debt Equity
0.8
0.7
0.6
0.5
0.4
Debt Equity
0.3
0.2
0.1
0
1
2
3
4
5
6
7
8
9
10
59

60. 90
80
70
60
50
Book Value (1)
40
Market Value
30
20
10
0
1
2
3
4
5
6
7
8
9
10
60

61. Thank
You!
61