Apr'25 View on Zee Entertainment Enterprises Ltd

Zee Entertainment Enterprises is mainly in the following businesses: Broadcasting of Satellite Television Channels, Space Selling agent for other satellite television channels, and Sale of Media Content i.e. programs / film rights / feeds /music rights. • Zee’s ad revenues declined ~8.4%/6.6% in Q3/9MFY25. • We expect earnings to grow by 11.9% in FY26E & grow by 11.5% in FY27E. • Stock is currently trading at valuation of 11.4x P/E FY27E EPS. • We cut FY26-27E EPS by 1-2%, roll over and revise FV to Rs125. • Our cautious stance is based on rising structural risks. Q3FY25 Earnings Update: Positives: • Recurring Profit after tax (PAT) stood at Rs242.1 cr (~17% beat). • Zee5’s growth in user base/ engagement metrics were encouraging. Negatives: • Zee’s ad revenues declined ~8.4% yoy in 3Q to Rs940.6cr (~3.6% miss). • Domestic subscription revenues grew 8.4% yoy to ~Rs895.9 cr (~2.4% miss). • FMCG slowdown adding to woes of linear advertising sector. • Other sales/services declined 42.6% yoy to Rs 55.7 cr .