Zee Entertainment Enterprises Ltd (NSE: ZEEL) reported a net loss of Rs 765.82 crore for the quarter ended March 31 (Q4 FY20). The company had posted a profit of Rs 292.53 crores for the corresponding quarter of the previous financial year.

ZEELQ4 FY20Q3 FY20Q4 FY19QoQ%YoY%
Total Income1991.742119.62076.06-6.03%-4.06%
Total expenditure2677.771608.571612.666.47%66.05%
Net Profit/Loss-766.68349.43291.88-319.41%-362.67%
Values in crore rupees

ZEE’s operating revenue stood at Rs 1951.74 crores in Q4 against Rs 2048.65 crores in Q3 of FY20, down 4.73% QoQ (quarter-on-quarter) and down 3.4% YoY to Rs 1,951.1 crore. This fall was mainly attributed to the loss in advertising revenues due to the unexpected situations which followed the COVID-19 induced slowdown in the industry.

A one-time provision of Rs 343.3 crore was included  for  “subscription and other assets where recovery has become doubtful on account of COVID-19 led uncertainty”, as said by ZEE.

ZEE in its BSE filing said that it achieved a 33% growth in domestic subscription revenues,the highest in the industry. Some key takeaways from the filing were :

  • ZEEL exited FY20 as the market leader with 18.3% viewership share.
  • ZEEMUSIC Co, a subsidiary of ZEE, maintains a highly successful YouTube channel with 55 million subscribers and 800 crore total views.
  • ZEESTUDIOS was the 3rd largest movie studio in the country in terms of box office collection.
  • ZEE5, the online streaming service, recorded 6.31 crore global monthly active users(MAUs).
  • Multiple domestic channels were introduced despite lockdown and the company expects it to boost revenues.

ZEE is expected to grow in the coming years alongside the entertainment industry. The ever-increasing demand for content will lead to advertisers will gradually returning. What is worrying is the investment of ZEE into new TV channels instead of focusing on online content distribution. With more of India population on the internet , ZEE5 and ZEEMUSIC can be pushed to become the main income generating platforms for the company. It is time to question whether ZEE is yet to get a wake-up call that online streaming is the future for the entertainment industry.

Shares of Zee Entertainment Enterprises(NSE:ZEEL) on Friday ended down 4.84% to Rs 151.25 in anticipation of poor results. You can read the complete BSE filing here.

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