Shares of Zee Entertainment Enterprises Ltd (ZEEL) slipped four percent in trade on Wednesday, July 23, as falling advertising dragged sentiment, sparking a sell-off in the stock. Over the past two sessions, the stock has fallen 10 percent.
Zee posted a net profit of Rs 144 crore for the first quarter of FY26, up nearly 22 percent from Rs 118 crore in the same period last year. Despite the profit growth, the company’s total income slipped to Rs 1,849.8 crore, down from Rs 2,149.5 crore a year ago and Rs 2,220.3 crore in the previous quarter.
Advertising revenue continued to face pressure, coming in at Rs 758.5 crore, a drop of 16.7 percent year-on-year and 9.4 percent quarter-on-quarter. Zee Entertainment’s advertising revenue was impacted by an extended sports calendar due to IPL 2025, continued weak ad spending by major FMCG companies, and a generally subdued domestic advertising environment.
Other income fell sharply by 64 percent due to a weak movie slate. EBITDA declined 16 percent year-on-year, with margins at 12.5 percent despite efforts to control costs.
Citi has maintained a 'sell' call on Zee Entertainment with a target price of Rs 110 per share. The company reported a 14 percent year-on-year decline in Q1 revenue across segments. Advertising revenue dropped 14 percent, while subscription revenue slipped 1 percent.
Elara Capital noted that Zee Entertainment grew slightly below expectations, though margin was in line. However, the brokerage noted that while ad revenue declined, 18 percent market share of linear TV in July 2025 further props Z’s market positioning. Language-focused content at Zee 5 and pricing action shall prop growth.
Ad revenue growth in H2 and momentum at Zee 5 may offer an operating leverage play, said Elara. The broking house maintained its 'buy' call, with an unchanged target price of Rs 200 per share.
At 2.20 p.m., shares of Zee Entertainment Enterprises were quoting Rs 128.35, lower by 4.1 percent.
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