Elections, rising FMCG ad spending to boost media stocks: analysts

Stocks of media companies are back in favour among investors with elections around the corner and FMCG companies raising ad-spends.

Fund managers and analysts expect media stocks, particularly those belonging to television and print media, to rise further from current levels as election coverage picks up and FMCG companies continue to raise advertising expenditure.

“We are extremely optimistic on media stocks as most of these companies have posted good September quarter numbers. There is a lot of vale-buying seen as revenues for these companies are likely to rise further,” said Alex Mathew, head of research, Geojit BNP Paribas Financial Services.

Analysts are particularly bullish on TV media as they feel they would be the main beneficiaries of the election-time coverage and broadcast.

“TV media has a much wider national reach than print media which gives them a clear advantage. Besides, the rise in FMCG ad spends, TV media companies have also been rising due to rising revenues from digitization of cable TV,” said Vivek Mahajan, head of research, Aditya Birla Money.

Zee Entertainment, Sun TV, Raj TV, Jagran Prakashan and PVR are among the favoured stock picks among analysts.

Technical analysts said that these stocks could rise by as much as 8-10% from current levels.