Key Highlights:
✅ Zee share price jumped 2.62% to ₹100.75 on NSE in early trade
✅ Nuvama maintains ‘Buy’ rating with a ₹185 target, implying 90% upside
✅ Promoters raised stake from 3.99% to 4.28% by acquiring 2.7 million shares
✅ Subscription revenue up for the 7th consecutive quarter, ad revenue recovery expected
Promoter’s Increased Stake Boosts Investor Confidence
Shares of Zee Entertainment rallied on Friday after brokerage firm Nuvama reiterated its ‘Buy’ rating, setting a target price of ₹185, signaling a potential 90% upside from the current market price.
The surge in stock price came after promoters acquired 2.7 million shares in the open market, increasing their stake to 4.28% from 3.99%. Analysts at Nuvama believe this move signals confidence in Zee’s long-term growth potential and is expected to boost investor sentiment.
Subscription Revenue Strength, Ad Recovery Expected
🔹 Subscription Revenue: Zee has maintained 7 consecutive quarters of growth in this segment. In Q3 FY25, subscription revenue increased by 6.6% YoY, largely driven by the growth of Zee5 subscribers. Analysts expect this upward trend to continue for a few more quarters, aided by price hikes and an expanding subscriber base.
🔹 Ad Revenue: While advertising revenue remains weak, recovery is anticipated as urban demand improves and FMCG companies increase ad spending. Zee’s reduced reliance on national brands has also been noted—though FMCG still contributes 60% of ad revenue, local FMCG brands are becoming a larger part of the mix and are willing to pay a 50% premium over national brands.
Future Outlook and Growth Drivers
🔹 Four Key Business Verticals: Zee is focusing on linear TV, digital, movies, and music, while also exploring gaming opportunities and potential acquisitions.
🔹 Q4 Expectations: Zee aims to improve margins, invest in content and movie launches, and grow revenue. The language content market is rebounding, and rural ad spending is picking up.
Stock Performance & Technical Indicators
📈 Zee stock rose 2.54% to ₹100.67 at 9:33 AM, outperforming the Nifty 50, which was down 0.06%.
📉 Despite the recent surge, Zee has fallen 37.22% over the past 12 months.
📊 Technical Indicator: The Relative Strength Index (RSI) is at 47.3, indicating the stock is neither overbought nor oversold.