Media stocks witnessed a buying frenzy today with Nifty Media surging the most among sectoral indices on the NSE, up 8 percent. The sharp uptick in the sectoral index today can be attributed to the surge in shares of Zee Entertainment Enterprises and Dish TV India. ZEEL constitutes nearly 27 percent and Dish TV India has about 7 percent weightage in the Nifty Media index.
Media stocks witnessed a buying frenzy on Tuesday with sectoral gauge, Nifty Media, surging the most among sectors on the NSE, up 10 percent. At 11.45 am, the Nifty Media index was up 9.8 percent at 1,893.25. Year-to-date (YTD), the index has gained close to 15 percent.
The sharp uptick in the sectoral index today came on the back of the surge in shares of Zee Entertainment Enterprises ltd (ZEEL) and Dish TV India.
ZEEL constitutes nearly 27 percent and Dish TV India has about 7 percent weightage in the Nifty Media index.
ZEEL share price soared nearly 24 percent while the latter’s stock surged 10 percent. Both were the best performers on the Nifty 500 index.
The strong buying momentum came following Invesco Developing Markets Fund and OFI Global China Fund calling a special shareholder's meeting to remove Punit Goenka as director along with the removal of two other directors Manish Chokhani and Ashok Kurien, who resigned on Monday.
“The largest uptick has been recorded on the Zee counter where investors are confident that the proposal to replace promoter-CEO Punit Goenka will go through. For a long time, the shares have been bearing the brunt of poor capital allocation, questionable related party transactions and other inferior governance practices by the current board. The possibility of a new and professionally competent board has lifted shareholder spirits,” said Nirav Karkera, head of research at Fisdom.
“At the same time, something similar has been happening with Dish TV receiving notice from its largest shareholder YES Bank to shuffle its top management. The notable bulk buying of Dish TV stocks by media giant Hindustan Times has been perceived as a vote of confidence in the brighter prospects that lie ahead for the DTH player,” Karkera added.
Karkera believes media continues to be an attractive sector from an investment standpoint, but opportunities today are more stock-specific than ever.