Zee and Sony to merge; here is how big new TV company will be

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Ziraat Times
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Mumbai, Sep 22: Two of India’s leading TV entertainment companies – Zee Entertainment and Sony Pictures Networks India – are coming together with the latter infusing an additional $1.6 billion into the merged entity to fund the company’s future growth.

According to the specifics of the deal announced by Sony Pictures Networks, it will be the majority shareholder in the merged entity, with a stake of 52.93%, while Zee shareholders will hold a 47.07% stake.

Shares of Zee Entertainment rallied by over 22% as of 11:50 a.m., on Wednesday (September 22). Overall, Zee’s shares have surged by over 83% in the last one month.

Sony Pictures will also have the right to appoint the majority of the directors to the board. But beyond the corporate side of things, here’s what Sony gets from Zee.

Market share

Zee currently holds a viewership share of 17%, according to a report by Dolat Capital, after slipping 300-350 basis points recently. 100 basis points make up 1%.

In comparison, the current market leader holds a share of 24% viewership. It has a portfolio of 37 domestic channels and 39 international channels.

“The flagship channel, Zee TV, is at first (or a close second) spot in the Hindi general entertainment channels (GEC) space. Its Hindi movie channel Zee Cinema and regional GECs Zee Bangla and Zee Marathi are strong players in their respective genres/markets,” stated a report by IIFL Securities dated September 15.

Here’s a look at some key financials of the company:

Particulars FY21 FY22e FY23e FY24e
Revenue ₹7,730 cr ₹8,191 cr ₹9,037 cr ₹9,881 cr
Margin (Ebitda) 23.2% 22.6% 25.9% 27.8%
Net profit ₹1,747 cr ₹1,119 cr ₹1,187 cr ₹1,440 cr

Source: Company reports, Prabhudas Lilladher

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