MUMBAI: Warner Bros Pictures has roped in Rishi Parekh as director content licensing, India. He has a lot of pedigree behind him and is known for his negotiation skills.
An MBA holder from University of Southern Queensland, Parekh’s previous stint was for seven years with Zee Entertainment where he was the chief channels officer English.
Prior to that he was senior manager commercial at Star India, also for nearly seven years. And before that he was with IOL Netcom for nearly five years.
MUMBAI: Recently, she has been posting on Linkedin only when she gets a promotion. Two years ago, Vibha Chopra had put out an update on the professional site when she moved on from Amazon Prime Video to Netflix as head of Hindi film licensing in India.
On 13 November, once again she used the platform to announce that she had been promoted in the Ted Sarandos-headed organisation. “Stoked to share that I am starting my new position as director – Hindi film licensing at Netflix, India,” she stated on Linkedin.
Chopra has come a long way from the time she was heading global syndication and international film distribution at Zee Entertainment for two years. And prior to that the fitness enthusiast headed Zee Film Studios International in Mumbai for four years. Before that Chopra spent a good three years at Zee America as vice-president brand solutions and special projects.
Mumbai: Zee Entertainment has announced the appointment of Vikram Lad as the new business head of its channel, Hamara Parivar. In this strategic role, Lad will lead various initiatives, including business development efforts aimed at enhancing the channel’s performance.
Lad’s responsibilities will encompass shaping the content strategy, engaging with audience feedback, and managing the channel’s profit and loss (P&L). Additionally, he will focus on strategic marketing and building partnerships to drive growth.
Bringing a rich background in the media industry, Vikram Lad co-founded Kintree, a social application designed for family tree building, where he served as COO. In this position, he was instrumental in developing the company’s strategic vision and overseeing operations, including managing investor relations and expanding the app’s reach across the Indian subcontinent, Southeast Asia, and the MENA region.
Before his tenure at Kintree, Lad held significant positions in various media organizations. He was Chief of Business Development at Chingari, a short video platform, in 2019. Earlier, he served as the Business Head for Zee Entertainment in Thailand from 2017 to 2019. His extensive career also includes roles at prominent brands such as Star Sports, Hotstar, Rediff.com, DNA, RBNL and Bharti Airtel.
Mumbai: Star India has ended its $1.5 billion deal with Zee Entertainment Enterprises Ltd for ICC TV rights, as announced in a regulatory filing by Zee Entertainment on 20 June. The dispute between the two companies, which began with Star India’s arbitration proceedings on 14 March, is being resolved through the London Court of International Arbitration (LCIA).
The agreement, originally formed on 26 August 2022, was a sublicensing arrangement for ICC TV rights covering Men’s and Under-19 (U-19) global cricket events through 2027. However, Zee Entertainment’s subsequent failed merger with Sony Pictures Networks India left it unable to fulfill its obligations under the deal as an independent entity.
Zee Entertainment has informed Star India of its inability to continue with the agreement and has requested a refund of Rs 69 crore that was already paid. The deal’s performance was contingent on several conditions, including the submission of financial and corporate guarantees and final ICC approval, which were not met.
Additionally, Zee has accumulated Rs 72.14 crore in bank guarantee commissions and interest expenses related to its share of guarantees and deposits. Zee contends that Star India’s failure to secure necessary approvals and execute required documents amounts to a breach of the agreement, leading Zee to repudiate the contract.
Mumbai: After a successful stint spanning half a decade at ZEE Entertainment, Meenakshi Samantaray as B2B Head of Marketing, a seasoned marketing professional has made a strategic career leap by joining Metro Brands as the head of marketing for the Sports Division The move is a strategic decision aligned with her passion for lifestyle and retail and to leverage her expertise into a fresh venture. She brings a solid marketing background of 13 years from her time at HUL and Future Group, showcasing a strong dedication to innovation and excellence in her new role.
With a diverse background in live entertainment and sports marketing, she aims to bring her expertise, talent, and wealth of knowledge to propel marketing initiatives at one of India’s leading footwear retail giants. The new position will allow her to pursue her core interests and utilise her expertise in the field. Meenakshi’s appointment marks a new chapter for Metro Brands as they enter the exciting world of sports marketing, reaffirming their position as a pioneering force in the retail industry.
Samantaray’s move to Metro Brands Ltd showcases her determination to forge new paths for growth and success in a changing business world. As she embarks on this new journey, all eyes are on Meenakshi to steer Metro Brands to unprecedented heights of excellence in the realm of sports marketing.
Mumbai: ZEE Content Sales, the syndication division of ZEE Entertainment, and VIP 2000 TV, a leading audiovisual production and distribution company in the Hispanic market, are delighted to announce their collaboration to produce a Modern Latin-American Telenovela for Global Audiences, Championing Autism Awareness.
This groundbreaking collaboration marks the inaugural co-production for a Telenovela between ZEE Entertainment and Latin America. The show is inspired by the acclaimed Indian soap opera “Aapki Antara.” Initially created in 2009 it has immense popularity for its poignant portrayal of social issues, particularly autism.
This daily series for prime time called “Valentina, My Special Love”, is a fresh take on the telenovela, set in the picturesque city of Guadalajara, Mexico. The show promises to captivate global audiences with a modern twist, weaving a poignant love story about a young woman with autism who is also a genius in the tech world.
This dynamic partnership between VIP 2000 TV and ZEE transcends boundaries, fostering empathy, shattering misconceptions, and shining a light on the essence of inclusivity and acceptance while telling a powerful love story.
VIP 2000 TV CEO Roxana Rotundo said, “We are thrilled to partner with ZEE TV in this unique IP. Audiences will fall in love with our lead character, Valentina. Production starts in July this year in beautiful Jalisco, Mexico. Valentina, My Special Love is not just a telenovela; it’s a catalyst for understanding and acceptance. We hope to inspire empathy and compassion among viewers worldwide while they enjoy good entertainment and a powerful love story.
ZEE – International chief business officer Ashok Namboodiri said, we are enthused with this collaboration with VIP 2000 TV to expand our content portfolio into Spanish telenovela. Our local adaptations across markets have set the standard for captivating content for a global audience. This is a unique story which will resonate not only with the 600 million plus Spanish speaking audiences but also travel to other parts of the world as a format.
ZEE SVP & head of digital syndication Manjyot Sandhu emphasised their commitment to continue to produce content appealing to audiences globally. We firmly believe that great stories transcend boundaries. At ZEE, we take pride in creating great stories over the last three decades, which have resonated with audiences on platforms across the world.
Valentina will feature a diverse cast of talented Hispanic actors, state-of-the-art production values, and a compelling storyline that resonates with audiences of all ages and backgrounds. Production will commence in July this year.
Mumbai: Zee Entertainment (Z IN) reported revenue of Rs 20.46bn, down 16.1 per cent QoQ and 3.1 per cent YoY, slightly below our estimates. Ad revenue declined 3.4 per cent YoY to Rs 10.27bn whereas subscription revenue grew 3.0 per cent YoY to Rs 9.21bn. Revenue from Zee5 stood at Rs 2.33bn, up 20 per cent YoY. The company reported an EBITDA of Rs 2,092mn with an EBITDA margin of 10.2 per cent, down 340bp QoQ and 580bp YoY. Reported PAT stood at Rs 533mn.
Z reported muted ad revenue, in line with our estimates, as it declined 3.4 per cent YoY, due to the shift of ad spending toward the Cricket World Cup (CWC); linear TV ad revenue will continue to grow by 3-4 per cent YoY on steady state, in our view, for the near to medium term, led by mild outperformance in the regional genre. Linear subscription revenue too is set to grow by ~4 per cent YoY on a steady state, as linear TV household loss will be offset by price hikes, which could be subject to regulatory hurdles post-NTO implementation. Growth in the digital business remains strong, as revenue grew 33 per cent YoY in 9MFY24 (contributed 10.7 per cent of total revenue in 9MFY24), led by higher subscription and ad revenue, and the launch of 73 shows & movies (including 14 originals) over the past three quarters. EBITDA margin remains healthy for the linear TV business at ~27 per cent in 9MFY24 (ex of OTT losses and movie revenue); however, with OTT losses, it is weak at 10.8 per cent; management is confident of achieving sharp improvement in EBITDA margin, led by 1) lower losses in OTT as investments have peaked, and 2) cost rationalisation on employee, technology and content. We believe the EBITDA margin could expand 450bp during FY24-26E to 15.4 per cent in FY26E, below management’s aspiration of ~18-20 per cent.
▪ Valuation: Despite the potential for improved profitability, concerns persist, such as 1) increased disruption in the digital & linear TV space due to the potential merger of Disney and Reliance, 2) legal overhang on pending litigations with creditors and Sony Corp, and 3) the absence of a strategic partner which could pose a challenge to scale up digital business offerings, a key growth driver. Z has a robust catalogue of movies, TV shows, web series and music content, which limits potential downside from current levels despite risks; the stock currently trades at 19.6x FY26E P/E. Any potential tie-up with a strategic partner or a turnaround to scale up digital offerings with lower losses will be key monitorable for an upgrade. We raise our revenue by 0.2 per cent for FY25E and 1.9 per cent for FY26E. We increase our earnings by 2.5 per cent for FY25E and 21.1 per cent for FY26E, due to better margin. We retain Sell with a higher TP of Rs 180 from Rs 170 due to better margin. We value the broadcasting business at 10 times (unchanged) one-year forward P/E and OTT at 3.0 times (unchanged) one-year forward EV/sales
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Mumbai: So has the implosion of the Sony Pictures deal with Zee Entertainment dampened the spirit of its MD and CEO Punit Goenka?
Not really. The eldest son of Zee founder Subhash Chandra is in Ayodhya with his family as this story is being written, attending the consecration of the Ram temple in the state of Uttar Pradesh.
Punit appeared unaffected by the refusal of Sony to give an extension of a month to try and forge an agreement, which please both the Japanese giant and Zee.
In high spirits, Goenka, smiled widely as he tweeted on the social media platform X: “ As I arrived at Ayodhya early this morning for the auspicious occasion of Pran Pratishtha, I received a message that the deal that I have spent two years envisioning and working towards had fallen through, despite my best and most honest efforts. I believe this to be a sign from the Lord. I resolve to move ahead positively and work towards strengthening Bharat’s pioneering M&E Company, for all its stakeholders. Jai Shri Ram .”
Mumbai: Zee Entertainment (Z IN) posted ad. revenue drop of 3.5 per cent YoY in H1, as demand environment was volatile despite recovery in ad spend. We estimate H2FY24E to report ad spend growth of mere 5-6 per cent YoY, as large portion of spends could be diverted to sports due to the Cricket World Cup (CWC). Subscription revenue was strong due to NTO 3.0, which led to price hikes after three years. Expect growth to be in the range of 7-8 per cent YoY in H2FY24E as well. Overall revenue grew a sharp 20.2 per cent YoY, largely led by performance of Gadar 2, excluding which overall revenue grew mere 5.4 per cent YoY. Zee5 also reported a revenue growth of 59 per cent YoY to Rs 2,652mn, helped by a syndication deal. Z gained viewership share in linear TV too, as its share grew 90bps QoQ to 17.9 per cent, helped by gain in selective regional genres.
Probability of merger going through high
Z’s share price performance will largely be led by valuation re-rating, hinged on the merger with Sony. The recent order passed by SAT allows Punit Goenka to remain the CEO of the merged entity, but the SEBI may continue to investigate Punit Goenka. As per our assessment (https://tinyurl.com/2wu5bxc7), the probability of the merger going through is high, with or without Punit Goenka, unless he does not change his stance (maintaining his view that he will give utmost importance to the merger going through for shareholder interest, even if he has to let go of his designation as CEO of the merged entity). Per our legal checks, there is a low likelihood of Sony wanting Goenka to remain as CEO, until the investigation outcome is known; further, the investigation outcome may take 12-15 months and Sony may not wait that long for the merger to be executed. This potentially increases the risk for Z/Sony merger, which may lead to valuations being under check.
Valuation: Reiterate Buy; TP unchanged at Rs 340
We reiterate buy with SoTP-TP of Rs 340 (unchanged) after factoring in merger synergies and potential medium-term play backed by the strength of Z and Sony in the TV and OTT businesses. We assume a cash infusion of $1.5bn by Sony and value the merged company broadcasting business at 20x (unchanged) one-year forward P/E and the OTT business at 4.0x one-year forward EV/sales. Our PAT estimate incorporates potential OTT losses.
The credit for this article goes to Elara Capital Sr VP – research analyst (media, consumer discretionary & internet) Karan Taurani.
Mumbai: The Securities Appellate Tribunal (SAT) passed an order on 30 October 2023 allowing Mr. Punit Goenka to become CEO and MD of the merged company, Zee Entertainment-Sony (Z-Sony). Based on our assessment of the detailed order (Zee SAT order) and channel checks with legal experts, we believe the SAT order is a positive for Goenka, as it states he can continue as MD and CEO, as there no strong evidence yet to support the allegations of money siphoning against him; further, his counsel has provided adequate evidence and documents to substantiate it.
Post this order, there is a high likelihood the Securities and Exchange Board of India (SEBI) will appeal against the order in the Supreme Court to get a stay; however, Z-Sony merged co. can be formed with Goenka as its head in the interim. The SAT order also states the investigation in this case will continue; as per our assessment, the outcome could take 12-18 months; Goenka could obtain necessary legal recourse in case the outcome is against him in the medium term; if it is favourable, he will continue as usual.
This underscores our view that there is no likelihood of Sony backing out from the merger, and Goenka getting relief could lead to expedited timelines for the merged entity to be formed with him at the helm, as it may not require changes in the term sheet or any shareholder and Board approval. Further, appeals made by Axis Finance and IDBI Bank will have no impact on the merger, and the NCLT approval is without any conditions. We believe the merged entity record date could be announced in the last week of November or in the first week of December, which means the merged firm could be listed in January 2024 (post six weeks of delisting). We maintain BUY with a Sep’24 TP of Rs 340.
SAT order removes overhang on merger: Goenka to be reinstated as CEO of merged entity
The SAT order is a significant victory for Goenka. Nevertheless, it is expected that SEBI will persist with its investigation, as the allegations against Zee Entertainment appear to hold merit. However, Sony will have to appoint Goenka as CEO of the merged company; further, this will not lead to change in the merged entity board and merger timelines. It is highly likely that SEBI will file a statutory appeal against the SAT order in the Supreme Court in the next 60 days. If this were to take place, the earliest date for a hearing would be scheduled for the first week of January 2024. Therefore, we believe there is no likelihood of Sony backing out of the merger as there are no legal constraints preventing it from proceeding. Further, the cases before the National Company Law Appellate Tribunal (NCLAT) against Zee will continue and will have no impact on the merger.
SEBI to continue with the investigation without a timeframe
As per the order, SAT has acknowledged the allegations of fund diversion have yet to be proven, and both Zee Entertainment (Z IN) and Goenka have presented satisfactory explanations supported by documentation, effectively fulfilling the burden of proof. Additionally, SAT also says it has noted factual inaccuracies in the order issued by whole-time members regarding specific companies that were classified as Essel Group companies when in fact they were not, but at this moment it is not fair to punish Goenka because the merger of Zee-Sony has been allowed. Nevertheless, SAT has granted SEBI the authority to proceed with its inquiry into the alleged fund diversion of Rs 42.1bn by Subhash Chandra and Goenka, without establishing a specific timeframe for the investigation. Z and Goenka have been instructed to cooperate with the investigation.
Merged entity likely to be listed between December 2023 and March 2024
We expect the merged entity to get listed anytime between December 2023 and March 2024. This will depend on how Sony wants to take it forward. The RoC (Registrar of Companies) filing has been done and processes required for the merger could end in the next four weeks. The investigation timeline could vary between 12 and 18 months post the merged entity is formed. In case allegations are not proven, things will continue as usual. However, in case allegations are proven, Goenka may have to step down or find legal recourse. Post the merged entity is formed with Goenka as CEO, our checks with legal experts indicate that Sony may also support Goenka in legal proceedings against SEBI, which also provides comfort.
We retain our positive stance on Z-Sony merged company
In the newly configured merged entity Board, five out of nine directors would represent Sony, with the Chairman also hailing from Sony. This shift in Board composition is anticipated to lead to an enhancement in corporate governance at Z along with a change in management dynamic favouring Sony. We retain our positive stance, led by:
1) synergistic benefits
2) MNC control (superior corporate governance practices)
3) positive impact of consolidation in the TV industry
4) Scaling up of the OTT business.
The credit of this article goes to Elara Capital SVP Karan Taurani