Why Did Sun TV Shares Plummet Over 5% Amid Maran Brothers Legal Battle?
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Synopsis
The ongoing legal dispute between the Maran brothers has triggered a significant drop in Sun TV Network's shares. With allegations of fraudulent practices and mismanagement, the situation raises concerns about the future of the company and its financial health.
Key Takeaways
- The shares of Sun TV Network fell over 5% due to a legal dispute.
- Dayanidhi Maran accuses Kalanithi Maran of fraud and misgovernance.
- Allegations include serious financial crimes and potential investigations.
- Sun TV operates across multiple languages and has diverse media holdings.
- The company's financial performance is facing challenges amid the dispute.
Mumbai, June 20 (NationPress) The shares of Sun TV Network Limited witnessed a decline of over 5% on Friday morning following a legal confrontation between the Maran brothers — Dayanidhi Maran and Kalanithi Maran.
Dayanidhi Maran, a DMK MP and former telecom minister, has issued a legal notice to his elder brother, Kalanithi Maran, who serves as the Chairman and Managing Director of Sun TV, concerning alleged financial misconduct.
In this notice, Dayanidhi has accused Kalanithi of engaging in 'fraudulent practices' and 'misgovernance' during the acquisition of Sun TV.
He claims that his brother was involved in a range of 'calculated and coordinated financial crimes', including cheating and money laundering.
The notice further threatens to invoke a probe by the Serious Fraud Investigation Office (SFIO).
At the heart of the dispute lies the shareholding of Sun TV following their father, Murasoli Maran, passing away in 2003.
The notice asserts that their father died intestate and requests that the company’s shareholding be reverted to its 2003 levels.
It also calls for investigations by several agencies, including SEBI, RBI, SFIO, ED, and the Registrar of Companies (ROC).
In light of these developments, Sun TV’s stock dipped as much as 5.25% to Rs 580 in early trading.
However, it managed to recover some losses to trade 3.41% lower at Rs 591. Over the last 12 months, Sun TV shares have fallen by 23.7%, and they are down nearly 13.9% year-to-date.
Kalanithi Maran currently retains a 75% stake in the company, which has a market capitalization of Rs 24,124 crore.
Sun TV Network operates television channels in seven languages, including Tamil, Telugu, Hindi, and Bengali.
Additionally, it runs FM radio stations across India and owns the IPL team Sunrisers Hyderabad along with the Sunrisers Eastern Cape in South Africa’s T20 league.
Financially, the company has also faced challenges. In the March quarter (Q4 FY25), Sun TV reported a 10.4% drop in consolidated Profit After Tax to Rs 371.77 crore.
Revenue from operations decreased by 2.15% to Rs 940.59 crore compared to Rs 961.28 crore in the same quarter the previous fiscal year (Q4 FY24).
Point of View
The legal conflict between the Maran brothers not only affects Sun TV Network but also raises broader questions about corporate governance and ethical practices in Indian businesses. It’s crucial for stakeholders to remain informed and vigilant as the situation develops.
NationPress
20/06/2025
Frequently Asked Questions
What led to the decline in Sun TV shares?
The decline is primarily due to a legal dispute between Dayanidhi and Kalanithi Maran, with allegations of financial misconduct.
What are the main allegations in the legal notice?
Dayanidhi Maran has accused Kalanithi Maran of fraudulent practices and misgovernance related to the company's shareholding.
What impact has this had on Sun TV's stock price?
Following the legal dispute, Sun TV's stock fell as much as 5.25% in early trading.
Who holds the majority stake in Sun TV?
Kalanithi Maran currently holds a 75% stake in Sun TV Network Limited.
What is the financial performance of Sun TV like?
In the latest quarter, Sun TV reported a 10.4% decrease in profit and a slight drop in revenue from operations.
