Shares of Zee Entertainment Enterprises saw selling pressure in trade on Friday, July 11, after shareholders rejected the promoters' proposal to infuse fresh capital into the firm.
40 percent of Zee Entertainment's shareholders voted against the special resolution of Zee promoters' proposal to infuse Rs 2,237 crore through subscription to preferential warrants. While a normal resolution needs only more than 50 percent support, special resolution needs 75 percent plus shareholder vote.
The proposal received retail support as nearly 80 percent of individual investors voted in favor of the resolution, while only 20 percent opposed. The development is important since retail investors own more than 40 percent in the company.
At 9.18 a.m., shares of the firm were quoting Rs 137.36, down 3.2 percent on the NSE.
On the other hand, institutional investors were less welcoming about promoters increasing their stake in company as 52 percent institutions voted against the proposal, while 48 percent voted in favour tilting the fate of the resolution.
Earlier, India’s leading proxy advisory firms had asked Zee Entertainment shareholders to vote against the company’s proposal to allot 16.9 crore warrants to promoters for Rs 2,237 crore, citing what they say are “multiple red flags”.
The governance advisers have opposed ceding greater control to chief executive officer (CEO) Punit Goenka, which, they say, will be at the cost of public shareholders who will see a significant dilution of their stakes. The allotment would have increased the shareholding of Goenka and his family to 18.39 percent from 3.99 percent.
Last year, shareholders defeated a resolution to appoint Goenka as the managing director. The company currently doesn’t have any major capital requirements, proxy advisory firms have said, adding it had cash and equivalents worth Rs 2,240 crore as of March 31, 2025.
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