Zee Entertainment Enterprises hits 52-week low after NCLT admits company to insolvency resolution

Shares of Zee Entertainment Enterprises tumbled 4.64% to Rs 196.35 after bankruptcy court admitted the company under an insolvency plea filed by a private sector lender, on grounds of default of over Rs 83 crore.

On the BSE, over 21.93 lakh shares of the company were traded in counter so far as against an average trading volume of 2.98 lakh shares.

On the NSE, over 5.77 crore shares of the company had changed hand in the counter as compared with an average trading volume of 48.63 lakh shares traded in the past three months.

In an exchange filing made late on Wednesday, the Essel Group-owned media company informed that in the petition filed by IndusInd Bank against the company under the Insolvency & Bankruptcy Code, 2016, the National Company Law Tribunal, Mumbai Bench (NCLT), has pronounced its order dated 22nd February, 2023 admitting the company to corporate insolvency resolution process under the provisions of the Bankruptcy Code.

As per media reports, IndusInd Bank has claimed a default amount of Rs 83.08 crore or $10.04 million against the media company. Zee is reportedly a party to the debt service reserve account (DSRA) guarantee agreement entered into with the private bank for the term-loan facility advanced to another Essel Group firm, Siti Networks.

Reports suggest that NCLT has appointed Sanjay Kumar Jhalani as the interim resolution professional.

The scrip tumbled 14.2% to hit the day's low at Rs 176.60 in trade today, which is also a 52-week low for the counter.

ZEEL is a media & entertainment company offering entertainment content to diverse audiences. It is present across broadcasting, movies, music, digital, live entertainment, and theatre businesses, both within India and overseas.

The company's consolidated net profit slumped 91.9% to Rs 24.31 crore in Q3 FY23 as against Rs 298.73 crore recorded in Q3 FY22. Revenue from operations declined marginally to Rs 2,111.18 crore in quarter ended 31 December 2022 from Rs 2,112.64 crore posted in the same period a year ago.

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