Zee Entertainment share price slumped over 6% on Monday's trade after the Securities and Appellate Tribunal (SAT) declined to grant a stay on an order against Punit Goenka and Subash Chandra. Zee Entertainment shares opened at ₹207.20 apiece on BSE, and the stock hit intraday high of ₹286.90 and low of ₹172.25. Following the news, the stock was under intense selling pressure.
Subhash Chandra Goenka, chairman of the Zee Group, and Punit Goenka, CEO of Zee Entertainment, challenged the Securities and Exchange Board of India's (Sebi) decision to bar them from the Indian market.
But the final decision in the dispute is still pending.
The chairman of the Essel Group and his son Punit Goenka were prohibited from holding any directorships or important managerial roles in any publicly traded firm on June 12 by the capital market regulator.
Sebi determined in a 16-page judgement that both Subhash Chandra and Punit Goenka had misappropriated funds for their own gain while acting as directors/KMPs of a publicly traded firm.
While refusing to overturn the regulator's instructions, the Securities Appellate Tribunal stated that it did not see any justification for interfering with the decision and instructed both of them to defend themselves before SEBI.
The decision comes as Zee and a regional division of Sony Group Japan are nearing a merger that was initially announced in 2021 to form a $10 billion TV company, with Goenka slated to serve as the merged company's managing director and CEO. Regulator permissions, however, are still pending.
On the technical front, the stock price fell 8.9% and underperformed its sector by 21% in the past year. During, monday's session, the stock fell 28.87% from 52-week high recorded on October 6, 2022.
“Last week stock prices witnessed a strong bounce from lower levels and considering the weekly candle stick formation it seems the prices have confirmed a short term formation. Going ahead, in the near term prices may extend upmove towards 200 dma at 220 levels whereas 190 is likely to act as strong support," said Rajesh Bhosale - Equity Technical and Derivative Analyst, Angel One.
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