The top dog may now again be an underdog. The tables seem to be turned on Star Publications (M) Bhd, if analysts are asked to ponder the digital future of the publisher of Malaysia’s leading English daily.
It has embarked on a move to migrate readers from print to digital platforms to arrest falling profits, but the jury is out on whether the company can transform fast enough to drive future earnings up.
Analysts agree that the company has very much less than two decades left - the time it took for the paper to rise from an underdog to become Malaysia’s leading English newspaper.
Can it thrive in the hyper-trendy online space as well as it has in the mainstream, and will advertisers follow?
On this front, most analysts said the company has underperformed, pointing to a near 20 percent slump in its share price last year, from which it is still striving to recover.
Its share price, which rarely strayed from the RM3-RM3.40 range in 2011-2012, slid from November onwards to an all-time low of RM2.35 on May 2 before recovering.
It is noted that The Star’s shares were trading at RM2.85 on Thursday.
“The Star has been too slow to react as the online media and TV have siphoned their advertising expenditures (adex) away over the last one to two years,” one industry analyst said.
The evolving and crowded Malaysian media landscape, dogged by patronage, stringent government controls, fickle reader support and pluralism, makes bank-backed equity analysts unsure about valuing The Star’s stock.
Who can fairly measure how much of a fan base The Star really has?
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