We like JPL for its its leadership position in UP (the largest print market in terms of readership and print ad value), strong position in growing regions like Bihar and Jharkhand, better cost efficiency, phased and planned expansion into other forms of media businesses, and a wider portfolio (including Mid-Day). 9MFY11 business growth (20% ad growth) strengthens our belief that it is well poised to benefit from steady growth in the print media sector.

Robust ad growth of 18% CAGR FY10-FY12E coupled with margin enhancement would drive overall growth for the company;

Broad based growth across various other business verticals; 3) Blackstone investment to support its inorganic growth.

Our revenue estimates vary from consensus by ~3%, mainly account of incorporation of Mid-Day numbers in FY12. Our Net margin forecast for FY12 which is 19% is in line with consensus. Our FY12 EPS estimate is 3% lower than the consensus.

1) Increase in newsprint prices; 2) Slow down in economic activity; 3) Increased competition in current markets where JPL is present.