Zee Entertainment Enterprises Ltd (Rs. 132.46): Buy 

Target Price: Rs. 195 - Rs. 220

Zee Entertainment Enterprises Limited (ZEEL) is gearing up for an exciting end to 2024 with several high-profile film releases. One of the most anticipated films is "Emergency", directed and co-produced by Kangana Ranaut, which is tentatively set to be released by December 2024. Recently, the film received a U/A certificate from the Censor Board of Film Certification (CBFC) after implementing some required changes.

Recent Film Releases: 

As of October 2024, ZEEL has successfully released several films this year, including:

💢Deva (Released on October 11, 2024): This action-thriller stars Shahid Kapoor and Pooja Hegde, following a police officer's pursuit of a high-profile case.

💢Savarkar: A biographical film detailing the life of Vinayak Damodar Savarkar, which highlights key events and ideologies from his life.

💢Sky Force (Released on October 2, 2024): Featuring Akshay Kumar, this film is based on true events from an airstrike in 1965.

💢Jigra (Released on September 27, 2024): Starring Alia Bhatt, this film was co-produced by Zee Studios, a subsidiary of ZEEL. While ZEEL oversees the operations, Zee Studios functions as an independent entity for film production and distribution.

Upcoming Projects:

ZEEL continues to expand its film portfolio with several projects lined up for release:

💢Emergency: A biographical drama directed by Kangana Ranaut.

💢Ae Watan Mere Watan: Featuring Kangana Ranaut, this historical drama is set during the Indian independence movement, with a release date announced for December 1, 2024.

💢Maidaan: Starring Ajay Devgn, this sports drama highlights the golden era of Indian football. While the release date is set for December 2024, a specific date has yet to be confirmed.

Strategic Goals: 

ZEEL aims to produce up to 40 films annually, encompassing a variety of genres and languages. 

This ambitious plan is part of their broader strategy to enhance its content library and strengthen its film production capabilities, ultimately reaching a wider audience. The films will include a blend of Hindi and regional productions, catering to diverse viewer preferences. In alignment with these goals, ZEEL is making significant strides in its digital business.

Financials:

In Q1FY25, the EBITDA loss for ZEE5 narrowed to ₹158.8 crore from ₹265.2 crore the previous year. While revenue decreased by 17.93% YoY, the net profit saw a remarkable increase of 70.3% YoY.

For Q2, ZEEL reported an Earnings Per Share (EPS) of ₹2.1, reflecting a year-over-year decline of 5.95%. This decline is likely attributed to the company issuing additional shares as part of its capital-raising strategy, resulting in share dilution.

Relationship With Zee Studios: 

Zee Studios is a wholly-owned subsidiary of Zee Entertainment Enterprises Limited (ZEEL). This means that ZEEL holds 100% of the shares in Zee Studios. As a wholly-owned subsidiary, Zee Studios operates under the umbrella of ZEEL and is fully controlled by it. Thus, Zee Entertainment Enterprises Limited (ZEEL) holds a significant stake in Zee Studios, which operates as its film production and distribution arm. 

This relationship allows ZEEL to have a vested interest in the projects and productions undertaken by Zee Studios, including films, web series, and other entertainment content. The structure allows ZEEL to expand its content offerings across various platforms while maintaining control over its subsidiaries.

Analyst Sentiment:

Analysts tracking the scrip has a mixed opinion. Out of 17 analysts covering the company:

💢1 has given a Strong Sell rating,

💢7 recommend a Sell,

💢5 rate it as Hold,

💢1 suggests Buy,

💢3 have given a Strong Buy rating.

However, as of October 19, 2024, the consensus recommendation remains a Hold.

Conclusion: It is heartening to see that under the able guidance of Puneet Goenka, Zee Entertainment Enterprises Ltd is positioning itself strategically in the competitive Indian entertainment landscape, with an array of upcoming films and a focus on digital growth. While challenges persist, the company's ambitious plans and investments could yield positive results in the future.