Poor connection for Sun TV investors even as firm gets tougher on content

Persistent weakness in advertising revenue, challenging outlook may drag company's earnings

Shares of Sun TV Network fell close to 7 per cent on Tuesday after reporting worse-than-ex­pected results in the October-December (Q3) period. The stock recovered a bit before closing with a loss 4.4 per cent.

Advertising revenue in Q3 declined 10 per cent over the corresponding quarter of FY20 to Rs 311 crore, compared to industry average of 4-5 per cent growth. This marks the eighth consecutive quarter of contraction in advertising revenue for the company.

Sun TV believes the under-performance was because of weak advertising spend by local retailers, who contribute significantly to revenues, and fewer movie releases. Local advertisers contributed