Zee Entertainment is unlikely to see any major downside going forward, said Karan Taurani, Vice President, Elara Capital. Taurani said that the corporate governance issues have already been priced in.
The company reported a 6.73 per cent rise in consolidated net profit at Rs 412.09 crore for the second quarter ended September 2019, driven by strong performance in domestic broadcast and digital businesses.
The company's total income rose 7.63 per cent to Rs 2,190.13 crore during the quarter under review as against Rs 2,034.79 crore in the corresponding quarter last year.
“I do not see any kind of major downside from hereon. If at all there is, the stock should bounce back because valuations are low at about 10-11 time PE one year forward,” said Taurani in an interview with CNBC-TV18.
Talking about balance sheet issues, Taurani said, “It can have some kind of an impact definitely in the near term but the only thing here is the promoter issue which is still taking some amount of time.”
Taurani is positive on the stock but said that it will be tough for TV ad revenue growth to touch 7 percent going forward.