ZEE shares at Rs 150 or Rs 200? Recovery slow, legal issues ahead, say analysts
ZEE stock outlook: Motilal Oswal said it would be important to see the company’s growth plans moving forward, particularly focusing on the recovery in the ad market, and decisions within the digital space,
- Feb 14, 2024,
- Updated Feb 14, 2024 8:25 AM IST
ZEE share price targets: Analysts tracking ZEE Entertainment Enterprises Ltd (ZEE) said while the ZEE management has outlined a recovery plan, there could be near-term margin weakness on account of several interventions. They cut target prices on the stock, citing multiple legal issues ahead. The recovery in ZEE sales remained slow, as the media firm reported six straight quarter of fall in advertisement revenues, analysts said while suggesting target prices for the stock in the range of Rs 165-200. The ZEE stock settled at Rs 188.60 on Tuesday.
"With the Sony merger being called off, the management has outlined a recovery plan, which targets steady state 8-10 per cent revenue CAGR coupled with Ebitda margin of 18-20 per cent by FY26; however, necessary interventions will have a one-time cost that would result in near-term margin pressure before recovery from H2FY25," Emkay Global said.
The merger failure can also have possible cases of shareholder activism and multiple legal issues can result in potentially significant losses in case of an unfavorable verdict, even as such issues consume management bandwidth, Emkay Global.
With ad revenues facing the heat from a subdued macro environment, merger falling off and a potential loss of market share is likely due to Viacom and Disney Hotstar deal, Nuvama has cut FY24-26 EPS estimates by 5 per cent. It has revised its target on ZEE to Rs 179 from Rs 190 earlier.
Motilal Oswal has revised its Ebitda and PAT estimates for FY25 by 8 per cent and 11 per cent on the back of laggard recovery within the ad revenues. It has maintained its target price on the stock at Rs 200 per share after assigning 20 times earnings per share on FY26E basis.
"With the merger process now being called off, it would be important to see the company’s growth plans moving forward, particularly focusing on a) the recovery in the ad market, and b) decisions within the digital space," it said.
Emkay Global has cut FY24-26 Ebitda estimates by 5-16 per cent, to factor-in the near-term margin weakness on account of interventions. "We retain our negative view on the stock and maintain SELL, revising down our target to Rs 165 (8x Dec-25E broadcasting EBITDA). We believe emergence of a new buyer/partner would be a key trigger for a stock re-rating," it said.
Prabhudas Lilladher in its first cut on ZEE Q3 results suggested a target of Rs 151 on the stock.
Also read: Buy Adani Enterprises shares, target price Rs 3,800: Jefferes on Adani group flagship
ZEE share price targets: Analysts tracking ZEE Entertainment Enterprises Ltd (ZEE) said while the ZEE management has outlined a recovery plan, there could be near-term margin weakness on account of several interventions. They cut target prices on the stock, citing multiple legal issues ahead. The recovery in ZEE sales remained slow, as the media firm reported six straight quarter of fall in advertisement revenues, analysts said while suggesting target prices for the stock in the range of Rs 165-200. The ZEE stock settled at Rs 188.60 on Tuesday.
"With the Sony merger being called off, the management has outlined a recovery plan, which targets steady state 8-10 per cent revenue CAGR coupled with Ebitda margin of 18-20 per cent by FY26; however, necessary interventions will have a one-time cost that would result in near-term margin pressure before recovery from H2FY25," Emkay Global said.
The merger failure can also have possible cases of shareholder activism and multiple legal issues can result in potentially significant losses in case of an unfavorable verdict, even as such issues consume management bandwidth, Emkay Global.
With ad revenues facing the heat from a subdued macro environment, merger falling off and a potential loss of market share is likely due to Viacom and Disney Hotstar deal, Nuvama has cut FY24-26 EPS estimates by 5 per cent. It has revised its target on ZEE to Rs 179 from Rs 190 earlier.
Motilal Oswal has revised its Ebitda and PAT estimates for FY25 by 8 per cent and 11 per cent on the back of laggard recovery within the ad revenues. It has maintained its target price on the stock at Rs 200 per share after assigning 20 times earnings per share on FY26E basis.
"With the merger process now being called off, it would be important to see the company’s growth plans moving forward, particularly focusing on a) the recovery in the ad market, and b) decisions within the digital space," it said.
Emkay Global has cut FY24-26 Ebitda estimates by 5-16 per cent, to factor-in the near-term margin weakness on account of interventions. "We retain our negative view on the stock and maintain SELL, revising down our target to Rs 165 (8x Dec-25E broadcasting EBITDA). We believe emergence of a new buyer/partner would be a key trigger for a stock re-rating," it said.
Prabhudas Lilladher in its first cut on ZEE Q3 results suggested a target of Rs 151 on the stock.
Also read: Buy Adani Enterprises shares, target price Rs 3,800: Jefferes on Adani group flagship