Zee Entertainment jumps on strategic business update

Zee Entertainment Enterprises (ZEEL) surged 11% to Rs 147.50 after the company released a detailed strategic business update outlining its plans for consolidation, capital infusion, and digital growth.

The company reported that it holds a 17% share of the urban TV viewership market (15+ age group). This comes amid broader industry consolidation that has resulted in a two-player market structure, with Peer-1 holding a dominant 34% share. Zee stated that it remains committed to strengthening its position in the evolving media and entertainment landscape.

As of March 2025, ZEEL's cash and cash equivalents stood at Rs 2,406 crore. The board has also approved the issuance of fully convertible warrants worth Rs 2,237 crore. Once fully converted, the promoter stake is expected to increase to 18.39%, subject to shareholder approval at the extraordinary general meeting scheduled for 10 July 2025.

The company said the proposed increase in promoter holding reflects long-term confidence in ZEEL's strategy and outlook. It also aims to create a robust cash reserve to effectively respond to competitive pressures and potential shifts in the market.

Despite a smaller scale compared to Peer-1, ZEEL remains one of the most profitable networks, reporting a 14.4% EBITDA margin in FY25. The company incurred a Rs 548 crore EBITDA loss in its digital platform Zee5 for the same period but aims to achieve breakeven in FY26.

ZEEL currently operates over 90 TV channels and has a content library comprising more than 265,000 hours of general entertainment and 6,850 movie titles. Its OTT platform, Zee5, features over 300 original titles.

ZEEL has outlined a clear roadmap for its next phase of growth, with a sharp focus on expanding its content and digital offerings. The company plans to venture into emerging formats such as micro-dramas, edutainment, live events, and user-generated content, aiming to capture a wider and more diverse audience base. Alongside this, it is looking to diversify its content across both short- and long-form formats to better cater to changing viewer preferences.

A key part of the strategy involves strengthening its digital ecosystem while staying anchored to its core strength, content creation. ZEEL also emphasized the importance of maintaining a strong balance sheet and remains open to exploring acquisition opportunities that align with its long-term goals.

The company reiterated its goal to deliver scalable and value-accretive growth initiatives that enhance profitability over the next three years. ZEEL is targeting to surpass its historical peak EPS of Rs 16.5, last recorded in FY19.

ZEEL is a leading content and technology powerhouse, seamlessly blending its rich legacy with pioneering innovation to deliver cutting-edge entertainment experiences. ?Z? brings diverse stories to life through linear television, digital platforms, movies and music across languages.

The company reported a consolidated net profit of Rs 188.4 crore in Q4 FY25, significantly higher than the PAT of Rs 13.4 crore in Q4 FY24. Net sales rose 0.65% year-over-year (YoY) to Rs 2184.1 crore during the period under review.

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