Sun TV shares fall 8% after Maran's resignation

CHENNAI: Sun TV, founded by the Maran family, the largest media firm in South India, moved between heavy and moderate losses as investors weighed the fallout of the resignation of textile minister Dayanidhi Maran for his alleged role in the telecom scandal.

Sun TV shares fell as much as 8% after Maran's resignation, fearing that the probe into the more than 1 lakh-crore corruption case, could possibly lead investigators to the company promoted by elder brother Kalanithi Maran.

Analysts are divided on the stock, with it being under pressure for the past two months as the Tamil Nadu government takes measures that will erode its profitabililty and end its near dominance of the media scene in the state.

"The fundamentals of the company are strong. However, one needs to closely watch the company's performance in the next three quarters to get the sense of the real impact. As of now, political risks are overruling the fundamentals," Manoj Behera analyst at Equirus Securities said.

It ended 2.6% lower at Rs 324, after plunging to the lows of Rs 305.95. Equirus has put the stock rating under review owning to the developments in the past few weeks. Earlier, it had a 'buy' rating on the stock with a price target of Rs 550. Shares of another group-owned company, Spicejet tumbled intra-day but recovered to close the day with a gain of 0.5% in a rising market.