Zee Entertainment stock jumps 6% on Q1 turnaround; posts Rs 118 cr profit

Zee Entertainment Q1 earnings impact: The company's consolidated total income grew by 7.6 per cent YoY to Rs 2,149.52 cr in Q1FY25 from Rs 1,998.26 cr in Q1FY24.

Shares of Zee Entertainment Enterprises (ZEE) surged 5.8 per cent to a high of Rs 153.45 in intra-day deals on Wednesday after the media company reported a turnaround in the June quarter (Q1FY25).

At 14:15 PM, Zee Entertainment stock was trading 4.3 per cent higher at Rs 151.30. The counter saw trades of around 15 lakh shares as against the two-week average volume of around 13.39 lakh shares. In comparison, the S&P BSE Sensex was up 0.2 per cent or 184 points at 81,640.

Zee Entertainment, in an exchange filing today, reported a consolidated net profit of Rs 118.10 crore for the quarter ended June 2024 as against a net loss of Rs 53.42 crore in the corresponding quarter a year ago. The company had posted a profit of Rs 13.4 crore in March quarter (Q4FY24).

Operating income grew by 7.4 per cent year-on-year (YoY) to Rs 2,131 crore in Q1FY25 when compared with Rs 1,984 crore in Q1FY24. Earnings before interest, taxes, depreciation, and amortization (EBITDA) jumped 75 per cent YoY at Rs 271.70 crore; margin improved to 12.8 per cent from 7.8 per cent in Q1FY24 and 9.7 per cent in Q4FY24.

ZEE said the soft advertising environment is offset by pickup in subscription revenue, movie releases and higher syndication revenue.

The income growth was aided by an 8.8 per cent YoY growth in subscription revenue to Rs 987.19 crore in Q1FY25 from Rs 907.49 crore, driven by pick up in linear subscription revenue post NTO 3.0 & ZEE5. Advertisement revenue, however, took a 3.1 per cent YoY hit, as it dipped to Rs 911.34 crore, impacted by cricket and general elections.

While Q1 has already started on a positive note with significant step up in margins, the management expects gradual margin improvement to continue through the rest of the year. Overall cost discipline and prudence will continue to hold us in good stead. The magnitude of margin improvement will be dependent on Ad revenue pickup in H2FY25. FY25 margins to be meaningfully better than FY24, the company said.

On the bourses, ZEE stock has been on a winning run for the last 7 trading sessions. The stock has gained 14.1 per cent during this period. The stock, however, trades almost 50 per cent lower when compared with its 52-week high of Rs 299.50 registered in December 2023. The stock hit a 52-week low of Rs 126 in June 2024.