Media and entertainment firm Zee Entertainment Enterprises Ltd (ZEEL) that is in advanced stages of its stake sale process has said that there will be a formal announcement in place by July.
“We are progressing well and with political uncertainty behind us, we hope to sign a binary agreement by July,” ZEEL managing director and chief executive officer Punit Goenka said over a conference call with analysts on Monday. Goenka who had previously claimed that the deadline for the sale had been pushed beyond April 2019, declined to share any other details.
Zee Entertainment Enterprises had announced in November last year that its promoters, led by Subhash Chandra, planned to sell up to 50% of their equity stake in the company to a strategic partner.
While earlier there were some reports suggesting that Japanese electronics and entertainment giant Sony Corp. is in advanced negotiations to buy a stake in the company, the talks were said to have derailed on differences over valuation.
Goenka also said the new tariff order brought in by the Telecom Regulatory Authority of India (Trai) had affected the company’s advertising revenues but they foresee an upside as soon as things settle down.
“Our dealing with multi system operators (MSOs) has become much simpler and most of them are following Trai orders,” Goenka said in response to the new regulation that allows for pricing of individual channels instead of placing them in pre-decided bouquets as was the case earlier.
Further, Goenka said the company was going to be focusing aggressively on its over-the-top (OTT) video streaming platform ZEE5 that had notched up 61.5 million monthly active users earlier this year.
“We want to scale up on our content, technology and partnerships as far as ZEE5 goes,” Goenka said about the service that will see 72 original pieces of content, including feature films and web shows this year.
ZEEL reported a 26.83% increase in consolidated net profit at Rs. 292.53 crore for the fourth quarter ended March 2019. The company had posted a net profit of Rs. 230.64 crore in January-March quarter a year ago, ZEEL said in a BSE filing.
Total income during the quarter under review stood at Rs. 2,076.06 crore, up 14.48% from Rs. 1,813.43 crore in the corresponding quarter of the previous year.
“We have delivered another quarter of strong operating performance which is commendable given the challenges the industry is facing in implementing the Trai tariff order,” Goenka said.
ZEEL’s total expenses during the quarter stood at Rs. 1,612.60 crore, up 23.77% from Rs. 1,302.84 crore in the year-ago period.
Revenue from advertisement rose 16%to Rs. 1,217.49 crore, as compared with Rs. 1,049.55 crore in the March quarter of 2017-18.
Revenue from subscription also rose 3.43 % to Rs. 565.27 crore as against Rs. 546.52 crore in the corresponding quarter last year.
“The subscription and advertising revenues for the fourth quarter were impacted due to the tariff order. However, our medium-term growth outlook for the business remains unchanged,” Goenka said.
Source: Mint