NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Motilal Oswal Report
The brokerage firm Motilal Oswal has reiterated its Neutral rating on Zee Entertainment Enterprises Ltd. and has kept target price unchanged of Rs 80, based on nearly 12 times FY28E price-to-earnings valuation.
The brokerage noted that Zee is currently trading at below 5x FY28E EV/Ebitda and holds a cash balance of around Rs 2,700 crore. According to Motilal Oswal, the stock's inexpensive valuations remain the primary factor supporting its Neutral stance on the company.
The brokerage also highlighted, slowdown in FMCG's ad spending on linear platforms continues to weigh on Zee's domestic ad revenue (~37% decline over FY19-26).
Motilal Oswal believes that a sustainable recovery in ad revenue remains the key to any potential re-rating of multiples for Zee.
The brokerage further cuts its FY27-28E Ebitda by 11-13% and adjusted profit after tax by 5-6%, driven by persistent weakness in ad revenue and higher expenses.
Despite a continued trend of decline in ad. revenue for the past several years, the brokerage has built in 3.5% CAGR in ad revenue over FY26-28E, which has downside risks from the structural shift in ad spending to the digital medium.
Motilal Oswal models a CAGR of 4% in revenue over FY26-28E, while it expects the FY28E Ebitda/PAT to decline 24%/17% from the FY25 levels.
Click on the attachment to read the full report:
ALSO READ: Astral Sees Target Price Cut From PL Capital Despite Healthy Q4 Numbers — Here's Why
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
