Zee recalibrating overall costs including content acquisition for Zee5

New Delhi: With an increasing focus on turning around the fortunes of Zee Entertainment, the company is customising its expenditure on content, especially for its OTT platform Zee5. 

Witnessing healthy progress such as higher growth in time spent and revenues of Zee5, the company is optimising the overall cost structure of Zee5 business.

The company in its earnings call said that it has to ensure that it is buying the right content at the right price. “Once profitability improves, Zee will deploy cash back into the digital business,” it said.

“Zee will not focus on buying expensive content but may instead focus on buying the right content suitable for Zee5 viewers,” the company said adding that Zee5 has not lost any subscribers and it expects it to grow every quarter.

Zee5’s revenue grew 8% YoY/ 6.3% QoQ to Rs 26.52 crore. It launched around 16 shows and movies in Q4.

Zee said that it will generate generous content and will ensure that it has reasonable room in its cost structure to fund content.

Zee is calibrating the overall cost of the business to achieve the medium-term target of ~18-20% EBITDA margin.

When asked about his five-year term as MD and CEO ending in December 2024, Punit Goenka said that he hasn’t reached out to shareholders regarding this. 

“At the end of the day, it is the shareholders who will decide whether I am the right person or not, or whether somebody else needs to lead this company,” told Punit Goenka, MD and CEO, ZEEL to analysts during the earnings call. 

Goenka, Zee's longest-serving CEO, was reinstated as the MD and CEO of the entertainment conglomerate in 2019. However, in August 2023, the Securities and Exchange Board of India (SEBI) issued a confirmatory order against Goenka and Subhash Chandra, prohibiting them from holding directorships or top managerial positions in Zee.

Although the Securities Appellate Tribunal (SAT) lifted the ban in October 2023, it permitted the regulator to continue investigating the Zee promoters.

Zee Entertainment on Friday reported a consolidated net profit of Rs 13.35 crore in the March quarter.

The company had posted a consolidated net loss of Rs 196.03 crore in the same period of the previous fiscal.

Consolidated total income in the quarter stood at Rs 2,185.29 crore as against Rs 2,126.35 crore in the corresponding period a year ago, it added.

In the fourth quarter of FY24, domestic advertising revenue grew 10.6 per cent year-on-year driven by the continued recovery in macro advertising environment and spending pickup by FMCG clients, while subscription revenue growth was driven by pick up in linear subscription, the company said in an investor presentation.