On Friday, January 24, ZEE Entertainment Enterprises (ZEEL) made headlines after it shared exciting news about its profits. The company’s net profit soared by 180% compared to last year, hitting Rs 164 crore for the third quarter. However, there’s a downside: their total revenue dropped by 3% year-on-year to Rs 1,979 crore.
When we look at the last quarter, the profit actually fell by 22% from Rs 209 crore in September, and revenue also decreased by 1% compared to the previous quarter. On a positive note, their earnings before interest, taxes, depreciation, and amortization (EBITDA) jumped by 52% YoY to Rs 318 crore, with profit margins improving to 16.5%.
In terms of advertising, ZEE saw a 4% increase from the last quarter but an 8% drop compared to last year due to a slow festive season. People are spending less, especially on fast-moving consumer goods (FMCG) ads. Subscription income also went up by 7% YoY, reaching Rs 982 crore thanks to traditional subscriptions and ZEE5’s streaming service.
However, sales and services from other sources fell due to fewer movie releases and less syndication revenue. ZEE emphasized that they are focusing on cutting costs efficiently while continuing to invest in growth opportunities.
In the nine months ending December 2024, total revenue dipped by 6% YoY to Rs 6,110 crore. Still, profits greatly increased by 283% YoY to Rs 491 crore. For this period, EBITDA also grew by 31% YoY to Rs 911 crore, with profit margins hitting 14.9%.
Stock Target Price
According to Trendlyne, the average target price for ZEE’s stock is Rs 156, suggesting a potential for a 29% increase from the current price. Among 20 analysts, the general advice is to Hold the stocks.
Stock Performance
On Thursday, ZEE’s shares closed at Rs 120.6, marking a 2.2% rise on the BSE, while the Sensex went up by 0.15%. However, the stock has dropped by 10% in the past six months and 58% in the last three years. The company’s overall market value is Rs 11,588 crore.
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