Zee Entertainment Q2 earnings on Wednesday: Heres what to expect

Zee Entertainment is slated to announce its financial results for the quarter ended September on Wednesday.

Brokerage HDFC Securities sees domestic advertising revenue growth of Zee Entertainment (ZEEL) to be healthy at 19 per cent. It further believes that strong performance to be led by market share gains in flagship channels and continued strength in regional markets.

HDFC Securities sees 20.30 per cent, 19.40 per cent and 17.80 per cent year-on-year (YoY) rise in adjusted profit after tax, EBITDA and net sales, respectively, of ZEEL in Q2FY19.

Market participants should zero in on the outlook on advertising and subscription revenue growth as well as investment and outlook on digital business.

Edelweiss Securities projected around 19 per cent YoY ad growth for Zee Entertainment in Q2FY19 on a comparable base of around 3 per cent. It also expects ZEEs EBITDA margin to remain strong at 31 per cent despite investments in new channels and ZEE5.

Ad revenue growth is likely to be aided by resumption in ad spends, particularly by FMCG companies. International subscription is expected to decline marginally by 1 per cent YoY on a negative base of 16 per cent. ZEE's new OTT platform ZEE5 is also likely to begin contributing to the company's top line. EBITDA margin growth is expected to be flat on account of higher content cost incurred for the launch of new regional channels, costs incurred in the movie business and significant investment & marketing for ZEE5. PAT growth is estimated to decline 28.2 per cent YoY, primarily due to an exceptional item of Rs 134.6 crore in Q2YF18, according to Edelweiss.

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