ICICIdirect recommends 'Buy' on Entertainment Network (ENIL) with target of Rs 490. Commenting on the investment rationale ICICIdirect, said, 'ENIL reported 9.4% YoY revenue growth to Rs 0.93 billion in line with our estimates, led by higher utilisation level of 98%, up from 92.3% in Q1FY14, and realisation of Rs 247 per slot per station, up 2.6% YoY on the back of increased election spending EBITDA came in at Rs 0.34 billion vs. our expectations of Rs 0.32 billion, led by higher realisation and lower-than-expected increase in employee cost.

EBITDA margin stood at 37.4%, up 236 bps YoY PAT was at Rs 0.24 billion , up 21.5% YoYENIL is expected to maintain its robust growth rate witnessing revenue and PAT growth of 13.9% and 18.2% CAGR, respectively, in FY14-16E. Phase III will lead to an increase in capacity of radio players while the revenue growth would be a mix of volume and yield. Also, clarity in terms of license extension of Phase II frequencies provides stability to operations. We rate ENIL as BUY, valuing it at 20x FY16E EPS of Rs 24.5, at a target price of Rs 490.'

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