Sun TV Network Ltd

SWOT analysis

Strength:

o Growth in Quarterly Net profit with increasing Profit margin (YoY).

o Company is debt free.
o Annual Net profit improving for last 2 years (from year 2019-20 to 2020-
21).
o Book value per share is also increasing from last 2 years.
o Company with zero promoter pledge.
o FII/FPI or Institutions increasing their shareholding.
Weakness:

o MFs decreased their shareholding last year.

o Inefficient use of capital to generate profits- RoCE declining in the last two
years.
o Inefficient use of shareholder funds – ROE is declining in the last two years.
o Inefficient use of assets to generate profit – ROA is declining in the last two
years.
o Decline in net profit (QoQ).
o Declining Net Cash Flow: Companies are not able to generate net cash.

Opportunity:

o Companies with current TTM RE Ratio less than 3-year, 5 year and 10 Year
PE.
o Positive breakout third resistance (LTP > R3).

Threats:

o The company is in Red Flags as firms linked to ongoing regulatory

investigations/legal cases.

PESTEL Analysis:
Sun TV Network Ltd's management can use PESTEL Analysis, which is a strategic
management tool, to make better decisions. PESTEL is an acronym that stands for
the political, economic, social, technological, environmental, and legal factors that
affect the firm's macro environment. Sun TV Network Ltd. works in a dynamic
environment where it is affected by things like more people caring about the
environment, how people spend their money, the regulatory framework, social
trends, government decisions, changes in technology, more environmental
regulations, and a legal system that is always changing.
Political Factors:

o Change policy with new government - Sun TV Network Ltd. must get ready
for this the change of government in the next election because it will lead to
a change in how the Services sector is governed.
o Government resource allocation and time scale - The new policies of the
Indian government could make the Services sector a better place to invest.
Since more people agree with the suggested policies, it is safe to assume that
they will last longer than the current India government's term.
o Importance of local governments in India – In India, unlike most other
countries, local governments are very important when it comes to making
policy and rules. Sun TV Network Ltd needs to pay close attention to the
states and territories it is in instead of making policies for all of India.

Economic Factor:

o Sun TV Network Ltd.’s short-term and long-term investment plans can be

affected by India's unstable exchange rate.
o In India, people who work in the Services sector have a moderate to high
level of skills. Sun TV Network Ltd. can use it to not only improve services
in India but also use India's skilled workforce to create opportunities around
the world.
o Sun TV Network Ltd. can grow internationally by using India's equity
market, which has strong financial markets and makes it easy to get money.
o I think India's economy will stay stable in the next 5–10 years because of
government spending, stable demand because people have more money to
spend, and increasing investment in new industries.
o India's trade policy could become more open, which could help Sun TV
Network Ltd invest in places it hasn't been able to invest in before.

Social Factor:

o Gender roles – In India, the roles of men and women are changing. Sun TV
Network Ltd can try out different ideas to support and adapt to the changing
roles of men and women in India.
o Leisure interests – In the Services sector, customers in India are more
interested in products that give them an experience than in traditional value
propositions. This is a trend that Sun TV Network Ltd. can use to make
products that give customers a better experience.
o Demographics – Sun TV Network Ltd has demographics on its side when it
comes to its services. India is a young and growing country. Sun TV
Network Ltd. can use this trend to reach out to different groups of people.
o Attitude towards health and safety – With more and more freedom, people
are becoming less concerned about health and safety. Sun TV Network Ltd
should not have these attitudes because the cost of failing in India is too
high.
o Education level – In India, especially in the Sun TV Network Ltd sector, the
level of education is high. It can help Sun TV Network Ltd. grow its
business in India.

Technological Factor:

o Lowering cost of production – In the Services sector, production and

service costs are falling quickly because of new technology. Sun TV
Network Ltd needs to change the way its supply chain is set up so that it
can be more flexible and meet both customer needs and cost structures.
o 5G and its potential – Sun TV Network Ltd must keep a close eye on how
the user experience is changing and improving as speed and access grow.
This can completely change how customers use Broadcasting and Cable
TV services.
o Technology transfer and licensing issues for Sun TV Network Ltd - In the
Services sector, there isn't a strong culture of technology transfer, and
companies are often hesitant to give away or licence their technologies
because they don't want to turn their collaborators into competitors.
o Maturity of technology – The technology in the Broadcasting and Cable
TV sector is still not fully developed, and most companies are competing
to come up with new ideas that will help them get a bigger share of the
Indian market.
Environmental Factors:

o Waste management is becoming more and more important for

companies like Sun TV Network Ltd., especially for units close to
cities. India's government has set up strict rules for how trash should
be handled in cities.
o Customer activism – Sun TV Network Ltd. has put environmental
issues at the center of its business plan because customers are more
aware of them. Customers expect Sun TV Network Ltd to not only
follow the law, but to go above and beyond it to be a good stakeholder
in the community.
o Recycling is quickly becoming the norm in India, rather than just a
good thing to do. Sun TV Network Ltd must make plans to follow
rules and expectations in the Services sector.
o The cost of running the Sun TV Network Ltd. is also raised by the fact
that environmental agencies check on it often.
o Extreme weather is also making the Sun TV Network Ltd.’s costs go
up because it must spend money to make its supply chain more
flexible.
o Sun TV Network Ltd. is also interested in renewable technology. It
can use the trends in this sector to its advantage. India is giving tax
breaks to companies that invest in renewable energy.

Legal Factor:

o Time takes for business cases in court – Even though some

countries follow international rules, it often takes years to figure
out what to do. Before entering an international market, Sun TV
Network Ltd. must carefully look at the average time for certain
cases.
o India's health and safety rules, what Sun TV Network Ltd. needs to
do to meet those rules, and how much it will cost to do so.
o Environment Laws and guides – How strict India's environmental
laws are and what Sun TV Network Ltd needs to do to follow
them.
o Business Laws – India's business laws and how they are applied.
Are these rules in line with those of the World Trade Organization,
the European Union, and other international groups.