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Last Updated : Jan 22, 2020 12:49 PM IST | Source: Moneycontrol.com

What should investors do with Zee Entertainment stock post Q3: buy, sell or hold?

Advertising revenue for the quarter was Rs 1,230.8 crore, a decline of 15.8 percent YoY.

 
 
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Zee Entertainment Enterprises share price fell 2.6 percent in the early trade on January 22 after the company posted a weak set of numbers for the quarter ended December 2019.

The company's third quarter (October-December) consolidated net profit fell sharply by 37.9 percent to Rs 349.4 crore, from Rs 562.4 crore in the same period last year.

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Revenue from operations in Q3 dropped 5.5 percent to Rs 2,048.7 crore YoY, dented by lower advertising revenue.

Also Read - Zee Entertainment Q3 profit falls 38%, but domestic subscription revenue beats estimates

Advertising revenue for the quarter was Rs 1,230.8 crore, a decline of 15.8 percent YoY. Domestic advertising revenue declined by 15.7 percent YoY to Rs 1,157 crore.

CLSA | Rating: Buy | Target: Rs 360 per share

The company's subscriptions jumped but ad revenue declined, while other expenses included a one-time credit-loss charge of Rs 38 crore.

CLSA feels that ad growth should return in FY21, while valuation compelling at a 50 percent discount to 10-year PE.

Macquarie | Rating: Outperform | Target: Rs 425 per share

The adjusted EBITDA is in-line with our estimate, meanwhile, the company needs to work on improving market share of its flagship GEC, Zee TV.

The further delay in receivables from Dish TV & Siti is a negative.

Improvement in cash generation and stronger corporate governance to drive re-rating, it added.

Morgan Stanley | Rating: Equal-weight | Target: Rs 340 per share

Domestic ad revenue is down 16 percent as tough macro environment weighed on advertisement spends.

Subscriber revenue growth moderated on promotional reduction in a-la-carte rates, while EBITDA affected by one-time charge of Rs 37.6 crore on delay in payments from two distributors.

At 09:20 hrs, Zee Entertainment Enterprises was quoting at Rs 282.85, down Rs 1.10, or 0.39 percent on the BSE.
First Published on Jan 22, 2020 09:32 am
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