Zee board approves raising funds up to ₹2,000 crore via issuance of equity shares and other methods; stock jumps 5%
The fundraising will not be limited to a private placement, QIP, preferential issue, or any other method or combination of methods.
The Board of ZEE granted in-principle approval to raise up to ₹2,000 crore through the issuance of equity shares or other eligible securities, on Thursday. The fundraising will be conducted in one or more tranches.
"The Board of Directors at its meeting held today considered and given its in-principle approval for raising funds by way of issuance of equity shares or any other eligible securities provided that the aggregate amount shall not exceed ₹2,000 crore," the company said in a filing.
The share price of Zee Entertainment witnessed a surge of 5.71 per cent on June 6. The stock closed at ₹154.65 on Thursday, against previous close at ₹146.30.
The fundraising will not be limited to a private placement, QIP, preferential issue, or any other method or combination of methods.
This proposal follows Sony's cancellation of its $10 billion merger earlier in January, which would have created a major Indian TV conglomerate.
The fundraising proposal follows Sony's cancellation of its $10 billion merger earlier in January, which would have formed an Indian TV powerhouse.
The board has also decided to closely monitor the business model and plan presented by the MD & CEO, who has outlined a roadmap to enhance the performance and efficiency of each business segment to achieve higher EBITDA.
In the recent fourth quarter, the company reported a profit of ₹13.35 crore, a significant turnaround from the loss reported a year ago, driven by strong advertising demand and reduced expenses.
Domestic advertising revenue for the quarter increased nearly 11 per cent year-on-year, fueled by the ongoing recovery in the macro advertising environment and increased spending by fast-moving consumer goods (FMCG) clients.
Additionally, the company incurred a restructuring-related charge of ₹21.97 crore during the quarter.
Karan Taurani, analyst at Elara Capital, stated that Zee has performed reasonably well in terms of tariff order price hikes and advertising revenue growth.
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