Introduction
Established in 1999, Zee Media Corporation Ltd (ZMCL) is a prominent player in India's news publishing and broadcasting sector. As part of the Essel Group, the company has carved a niche in delivering news across multiple platforms and languages, reaching both domestic and international audiences.
Company Overview
Product and Service Portfolio
- Broadcasting: ZMCL operates 15 news channels—1 global, 3 national, and 11 regional—reaching over 220 million users. Notable channels include Zee News, Zee Hindustan, and Zee Business.
- Digital Platforms: The company's online news portal, Zeenews.com, offers content in 9 languages, attracting over 60 million users.
- Global Reach: Their global channel, WION, is available in regions like the Middle East and North Africa (MENA) and the UK.
Recent Developments
- Settlement Arrangement: In FY23, ZMCL settled dues with Diligent Media Corporation Ltd (DMCL), recovering ₹12 crore in cash and awaiting approval for trademark transfers worth ₹170 crore.
- New Subsidiaries:
- Zee Media Americas, LLC: Established to expand in the U.S. and U.K. markets.
- Upcoming Infotainment Subsidiary: Focused on spirituality, mindfulness, and well-being, intersecting ancient knowledge with modern science.
- Fundraising Plans: The company plans to raise ₹200 crore through various financial instruments to fuel future growth.
Financial Performance
Quarterly Results (₹ in Crore)
| Quarter |
Sales |
Operating Profit |
Net Profit |
| Jun 2023 |
126 |
3 |
-14 |
| Mar 2023 |
135 |
26 |
0 |
| Dec 2022 |
116 |
-35 |
-38 |
| Sep 2022 |
109 |
-21 |
-28 |
- Sales Trend: Sales have seen fluctuations, with a recent uptick in June 2023 to ₹126 crore.
- Profitability: The company has struggled with profitability, reporting negative net profits in several quarters.
- Operating Margins: Operating Profit Margin (OPM) has been inconsistent, reaching as low as -30% in Dec 2022 but recovering to 2% in Jun 2023.
Annual Performance
- Revenue: A decline from ₹655 crore in FY22 to ₹517 crore in FY23.
- Operating Profit: Dropped significantly from ₹172 crore in FY22 to ₹64 crore in FY23.
- Net Profit: Turned negative in FY23, reporting a loss of ₹45 crore.
Key Ratios
- Return on Capital Employed (ROCE): Decreased to -12.5%, indicating inefficiencies in capital utilization.
- Return on Equity (ROE): At -17.4%, reflecting the company's unprofitable status in recent periods.
Shareholding Pattern
- Promoters: Hold a minimal stake of 0.42% as of June 2024, down from 4.34% in previous quarters.
- Public Shareholding: Increased to 91.43%, indicating higher retail investor participation.
- Institutional Investors: Foreign Institutional Investors (FIIs) hold around 8.15%.
Peer Comparison
| Company |
Market Cap (₹ Cr) |
P/E |
ROCE (%) |
Net Profit (₹ Cr) |
| Sun TV Network |
33,483.40 |
17.69 |
26.20 |
559.77 |
| Zee Entertainment |
13,457.84 |
33.37 |
6.62 |
118.10 |
| TV18 Broadcast |
7,694.05 |
N/A |
0.12 |
-120.03 |
| Zee Media |
1,569.83 |
N/A |
-12.51 |
-14.48 |
- ZMCL lags behind its peers in terms of profitability and market capitalization.
- The company reports negative earnings per share (EPS) and return ratios, signaling potential red flags for investors.
Future Outlook
ZMCL's efforts to expand globally and diversify into the infotainment space may offer new revenue streams. The planned capital infusion of ₹200 crore could bolster these initiatives. However, consistent losses and declining profitability pose significant challenges.
Conclusion
Investor Considerations
- Caution Advised: Given the company's recent financial performance, particularly the negative ROE and ROCE, investors should exercise caution.
- Potential for Turnaround: The new strategic initiatives and fund infusion might lead to improved performance in the future.
- Due Diligence: It's crucial for investors to conduct thorough research and consider their risk tolerance before making investment decisions related to ZMCL.
Disclaimer: This analysis is for informational purposes only and should not be construed as financial advice. Investors are encouraged to consult with a financial advisor before making investment decisions.
