RESULT UPDATE

ZEE ENTERTAINMENT ENTERPRISES

Write-off mars in line show

India Equity Research| Media COMPANYNAME

Zee Entertainment Enterprises’ (ZEE) Q2FY20 revenue and EBITDA came EDELWEISS 4D RATINGS

in line, while PAT undershot our estimate owing to an INR1.7bn ICD Absolute Rating BUY write-off. Key highlights: i) domestic subscription revenue jumped ~27% Rating Relative to Sector Performer YoY on account of the NTO tailwind & rising viewership in regional Risk Rating Relative to Sector Medium markets; ii) domestic advertising remained muted—up mere ~1% YoY—in Sector Relative to Market Overweight

the wake of advertising slowdown & withdrawal from the FTA platform; and 3) EBITDA margin contracted 155bps YoY to 32.7% owing to weak revenue growth. We expect ZEEL to be key beneficiary of NTO given its MARKET DATA (R: ZEE.BO, B: Z IN) strong viewership countrywide (refer to, Stay tuned: New tariff regime CMP : INR 264 Target Price : INR 399 set to kick in). Progress on pledged shares with VTB Capital is key 52-week range (INR) : 507 / 199 monitorable. Maintain ‘BUY’ with TP of INR399. Share in issue (mn) : 960.5 M cap (INR bn/USD mn) : 254 / 7,761 Ad growth slackens; subscription revenue jumps Avg. Daily Vol.BSE/NSE(‘000) : 11,372.4 ZEE clocked domestic ad growth of about 1.4% YoY, on a base of ~23% YoY, due to

softer ad spends by advertisers, withdrawal from the FTA platform and broad-based SHARE HOLDING PATTERN (%) economic slowdown. The business continued to clock strong domestic subscription Current Q1FY20 Q4FY19 revenue—up ~27% YoY (19% overall) on a base of 23%—due to bouquet re-pricing in Promoters * 44.0 44.0 44.0 NTO and strong offtake of ZEE’s channels. EBITDA grew ~2.5% YoY with margin MF's, FI's & BK’s 6.0 5.7 5.8 contracting 155bps YoY. ZEE5 clocked 8.9mn DAU count in Q2FY20. FII's 11.5 11.4 11.5

Others 38.5 38.8 38.7 Q2FY20 conference call: Key takeaways * Promoters pledged shares : 21.5 (% of share in issue) i) Bouquet pricing has not been changed, the cut in a-la-carte is only a festive offer; less than 10% revenue comes from a-la-carte, also the offer will only be for three months; PRICE PERFORMANCE (%) ii) No change to subscription revenue growth guidance. iii) ICD issue: Had issued to a EW Media company ‘Oscar’; trying to recover the money from them since the past three years; iv) Stock Nifty Index Receivables have gone up due to MSO and DTH: Dish and Siti – expect it to come down by Q4FY20. Have received definitive and binding payment plans from both the players. 1 month (24.7) 4.2 (8.9) 3 months (25.0) (1.7) (14.7)

12 months (44.7) 8.3 (32.8) Outlook and valuation: Positive; maintain ‘BUY’

While we expect ZEE to gain in the new tariff regime, near-term ad growth is likely to be subdued. Though festive season could offer some respite, material growth is likely to resume once demand from FMCG, auto, among others, revives. In our view, though the valuation is attractive now, resolution of promoter’s pledged shares remains key trigger for the stock. We maintain our target PE of 18x and retain TP at INR399. The stock is trading at ~13x/12x FY20E/21E EPS. We maintain ‘BUY/SP’. Financials (INR mn) Year to March Q2FY20 Q2FY19 % change Q1FY20 % change FY19 FY20E FY21E Abneesh Roy

Revenues 21,220 19,759 7.4 20,081 5.7 79,249 86,625 97,260 +91 22 6620 3141 EBITDA 6,929 6,758 2.5 6,598 5.0 25,550 26,946 30,296 [email protected]

Adjusted Profit 5,673 3,995 42.0 4,835 17.3 15,764 19,731 21,797 Prateek Barsagade Adj. diluted EPS 5.9 4.2 42.0 5.0 17.3 16.4 20.6 22.7 +91 22 4063 5407 Diluted P/E (x) 16.1 12.9 11.6 [email protected]

EV/EBITDA (x) 9.9 9.1 7.6 ROAE (%) 19.1 20.5 19.4 October 17, 2019 Edelweiss Research is also available on www.edelresearch.com, Bloomberg EDEL , Thomson First Call, Reuters and Factset. Edelweiss Securities Limited

Media

Table 1: Trends at a glance Revenue break up (INR mn) Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Total Ad revenue 9,867 12,020 10,496 11,460 12,106 14,626 12,175 11,867 12,247 International ad revenue 506 647 662 590 580 907 600 545 557 Domestic ad revenue 9,361 11,373 9,834 10,870 11,526 13,719 11,575 11,322 11,690 Domestic subscription 4,043 4,036 4,521 4,252 5,093 5,192 4,696 6,240 6,459 International subscription revenue 971 981 944 934 989 993 957 848 776 Total subscription 5,014 5,017 5,465 5,186 6,082 6,185 5,653 7,088 7,235 All India viewership share (%) 18.3 18.3 18.5 19.2 19.9 20.2 NA NA 18.4 Non-sports business Sales (non-sports) 15,805 18,381 17,253 17,720 19,759 21,668 20,193 20,081 21,220 Costs (non-sports) 10,893 12,437 12,191 12,064 13,001 14,125 14,150 13,484 14,291 EBITDA (non-sports) 4,912 5,944 5,062 5,657 6,758 7,543 5,683 6,598 6,929 EBITDA margin (non-sports) (%) 31.1 32.3 29.3 31.9 34.2 34.8 28.1 32.9 32.7 Growth rate International ad revenue (36.1) (20.8) 26.1 2.1 14.6 40.2 (9.4) (7.6) (4.0) Domestic ad revenue 6.4 30.2 23.8 19.6 23.1 20.6 17.7 4.2 1.4 Total ad revenues 2.9 25.8 23.9 18.6 22.7 21.7 16.0 3.6 1.2 Domestic subscription (13.5) (16.2) (0.7) 12.2 26.0 28.6 3.9 46.8 26.8 International subscription revenue (16.1) (12.2) (8.0) (6.6) 1.9 1.2 1.4 (9.2) (21.5) Total subscription revenues (14.0) (15.5) (2.1) 8.2 21.3 23.3 3.4 36.7 19.0 % of revenue Transmission & programming 36.6 36.6 40.0 37.7 36.8 36.8 43.7 38.8 42.2 Employee cost 11.5 8.4 9.5 9.7 8.5 8.5 10.0 10.0 10.0 EBITDA 31.0 32.3 29.3 31.9 34.2 34.8 28.1 32.9 32.7 PAT 31.9 18.9 7.4 19.6 20.7 24.8 14.9 24.1 26.7 Source: Edelweiss research

Q2FY20 conference call | Key takeaways • Total Q2FY20 revenue at INR21,220mn grew 7.4% YoY. The growth was driven by strong performance of domestic broadcast and digital businesses.

• Advertising revenue at INR12,247mn grew 1.2% YoY. Domestic advertising revenue grew 1.4% YoY to INR11,690mn. International advertising revenue was INR557mn.

• Subscription revenue at INR7,235mn grew 19.0% YoY. Domestic subscription revenue jumped 26.8% YoY to INR6,459mn. International subscription revenue came at INR776mn.

• EBITDA for the quarter grew 2.5% to INR6,929mn and EBITDA margin stood at 32.7%.

• ZEE5 recorded a peak DAU (Daily Active User) base of 8.9mn in September.

• ZEEL's television network had an all-India viewership share of 18.4% during the quarter.

Promoter pledging issue

• Working with several parties to remove the overhang from the ZEE stock.

• Latest development—ZEE Learn has received interest from strategic and financial investors.

2 Edelweiss Securities Limited Zee Entertainment Enterprises

ZEE5

• ZEE5 continues to be the biggest producer of digital original content in India. Further strengthening its position during the quarter, ZEE5 launched 23 original shows and movies, of which 13 were in regional languages.

• ZEE5 DAUs – 8.9mn; MAU to DAU conversion is lower than the industry but confident to grow from here.

• Conversion has gone up significantly from the previous quarter.

• Believe the pricing is appropriate – as long as quality content is delivered, customer will pay.

• The 120minute time spent is relevant to the 8.9mn DAU and not comparable to the previous 33minute.

Advertising

• Expect festive season and government measures to translate into good ad growth ahead.

• Weak advertising growth—overall industry declined ~4%. The company has managed to deliver ~2% despite the challenges and withdrawal of the FTA platform.

• FTAs contributed over 2% viewership to the network which the network has lost.

• Expects H2FY20 to be better than H1FY20.

Broadcast & subscription

• Cut in a-la-carte pricing. Bouquet pricing has not been changed, the cut in a-la-carte is only a festive offer; less than 10% revenue comes from a-la-carte, also the offer will only be for three months and not in eternity.

• Strengthened positioned in the Hindi movie and regional portfolio.

• Reach has risen in regional markets post the NTO.

• On-track to launch new regional channels.

• No change in guidance for subscription revenue for FY20.

Other

• Taken necessary measures to ring fence other deposits the business has.

• ICD issue: Had issued to a company ‘Oscar’; trying to recover the money from them since the past three years; had also stepped in for recovery. Believe that it will be recovered in the future.

• Receivables have gone up due to MSO and DTH payments: Dish and Siti – expect it to come down by Q4FY20. Has received definitive and binding payment plans from both the players.

• Reclassified the FD and unbilled revenue as financial assets.

• Inventory rose by INR5bn. Advances given earlier are getting accrued into inventory.

• Cash and treasury investments as on Q2FY20—INR14.8bn; includes CDs, FDs, MF investments, domestic and outside India.

3 Edelweiss Securities Limited Media

• Why has inventory gone up now? The business started acquiring digital rights for the movie library only three years back. Also acquires music rights for distribution and also content for ZEE5 is also sourced from third parties due to these three new segments the inventory has gone up. Films are amortised over five years and music over three years.

• 7% of the inventory is content and production.

• Non-film content is amortised 80% in first year and balance 20% over two years.

• Negative CFO in H1FY20. Working towards liquidating debtors and expects positive free cash flow by next year.

• RPT receivables was INR5bn as on March 2019. Overdue on this stands at INR2.5-3.0bn as of now.

• Of INR13bn financial assets, INR2bn is towards related parties; no RPT loan amount in other current assets.

• Total amount of INR7bn is pertaining to related party receivables overall.

• Content advances and deposits of ~INR9.5bn given in March 2019. There has downward been movement in the number.

• Inventory figure has bloated up because four new channels are still yet to be launched and investment spent in that is sitting in the inventory and hence not charged to the P&L.

• Future rights of INR4.5bn also in the inventory; amortising that has not even started.

• FV adjustment majorly pertains to preference shares; fluctuations in the market price of the share are adjusted notionally in the P&L.

• Expects OCF to be positive only by FY21; working towards positive FCF this year itself.

• Operational cost in the standalone P&L rose because of programming cost of the digital platform.

• Preference share payment will be made via internal accruals.

• Overall guarantee to less than INR3bn.

• No plans to reinvest tax savings in either broadcast or digital business.

4 Edelweiss Securities Limited Zee Entertainment Enterprises

Table 2: Balance sheet INRmn 30-Sep-19 31-Mar-19 % YoY Sources of funds Share capital 961 961 - Reserves and surplus 94,100 88,422 6.4 Shareholders fund 95,061 89,382 6.4 Redeemable Preference shares 7,059 7,409 (4.7) Other long term borrowings 306 20 1,398.0 Long term provisions 1,671 1,350 NM Non-current liabilities 9,036 8,779 2.9 Trade payables 14,075 14,897 (5.5) Redeemable Preference shares 3,530 3,704 (4.7) Other financial liabilities 6,582 8,029 (18.0) Other Current liabilities 1,156 1,096 5.5 Short term provisions 134 101 33.1 Other financial liabilities 3,058 3,342 (8.5) Current liabilities 28,535 31,169 (8.5) Total sources of funds 132,631 129,330 Uses of funds Fixed assets 7,256 5,959 21.8 Capital work in progress 384 1,083 (64.5) Investment property 1,538 1,551 (0.9) Other intangible assets (incl under development) 1,724 1,861 (7.4) Goodwill 5,252 5,252 (0.0) Non current assets 833 1,189 (30.0) Other non-current assets 5,379 9,096 (40.9) Total non-current assets 22,364 25,991 (14.0) Current investments 8,478 8,576 (1.1) Inventories 43,059 38,505 11.8 Trade receivables 24,185 18,274 32.3 Cash and cash equivalents 5,846 12,218 (52.2) Other current assets 28,700 25,765 11.4 Total current assets 110,267 103,339 6.7 Total uses of funds 132,631 129,330

Table 3: Cash flow statement Year to March 30-Sep-19 31-Mar-19 % YoY Operating profit before working capital changes14,348 27,803 (48.4) Less: Changes in WC 17,136 17,152 (0.1) Less: Direct taxes paid (328) 9,300 (103.5) Operating cash flow (2,460) 1,352 (282.0) Financing cash flow (5,054) (9,664) (47.7) Investing cash flow 2,686 8,663 (69.0) Change in cash (4,828) 351 (1,476.0) Source: Edelweiss research

5 Edelweiss Securities Limited Media

Financial snapshot (INR mn) Year to March Q2FY20 Q2FY19 % change Q1FY20 % change FY19 FY20E FY21E Advertisement 12,247 12,106 1.2 11,867 3.2 79,249 54,396 60,380 Subscription 7,235 6,082 19.0 7,088 2.1 50,367 27,029 31,380 Others 1,739 1,571 10.7 1,126 54.3 23,015 5,200 5,500 Net revenues 21,220 19,759 7.4 20,081 5.7 5,867 86,625 97,260 Total revenues 21,220 19,759 7.4 20,081 5.7 79,249 86,625 97,260 Transmission and prog 8,963 7,263 23.4 7,800 14.9 30,758 34,141 38,409 Staff costs 2,123 1,687 25.8 2,003 6.0 7,249 8,119 9,134 SG&A 3,206 4,051 (20.9) 3,680 (12.9) 15,692 17,418 19,422 Total expenditure 14,291 13,001 9.9 13,484 6.0 53,700 59,679 66,965 EBITDA 6,929 6,758 2.5 6,598 5.0 25,550 26,946 30,296 Depreciation 583 588 (0.9) 690 (15.5) 2,347 2,709 3,009 EBIT 6,346 6,169 2.9 5,908 7.4 23,203 24,237 27,287 Interest 180 55 229.7 205 (12.4) 1,304 976 834 Other income 681 589 15.6 1,039 (34.4) 2,515 2,638 2,655 Add: Prior period items Add: Exceptional items (1,794) (220) NA 679 NA (92) - - Profit before tax 5,054 6,484 (22.1) 7,420 (31.9) 24,321 25,899 29,108 Provision for taxes 921 2,624 (64.9) 2,146 (57.1) 8,673 6,193 7,335 Minority interest Associate profit share (12) 2 NA 23 NA 24 24 24 Reported net profit 4,121 3,861 6.7 5,298 (22.2) 15,673 19,731 21,797 Adjusted Profit 5,673 3,995 42.0 4,835 17.3 15,764 19,731 21,797 Diluted shares (mn) 960 960 960 1,921 960 960

Adjusted Diluted EPS 5.9 4.2 42.0 5.0 17.3 10.9 20.6 22.7

As % of net revenues Transmission and Prog 42.2 36.8 38.8 81.1 39.4 39.5 Employee cost 10.0 8.5 10.0 20.0 9.4 9.4 SG&A 15.1 20.5 18.3 33.4 20.1 20.0 EBITDA 32.7 34.2 32.9 65.5 31.1 31.1 Reported net profit 26.7 20.2 24.1 50.8 22.8 22.4

6 Edelweiss Securities Limited Zee Entertainment Enterprises

Company Description ZEE Entertainment Enterprises (ZEE) is one of the largest media companies in India. It owns and operates Zee TV and Zee Cinema, both leading channels in the Hindi GEC and movies segments, respectively. Besides these two, the company has an attractive bouquet of several other channels including &pictures, &TV, ZEE Anmol, Zindagi, Zing, Zee Classic, Zee Action, Zee Café and Zee Studios. With the likes of , , , and , the company has an impressive bouquet of regional channels.

Investment Theme GDP recovery, improvement in its market share in regional and movies genres and new launches will aid ad revenue growth. Higher penetration of DTH and the digitisation process augur well for faster growth in subscription revenue over the long term. Cautious investment in the movie production is positive for the company. We believe ZEE is well poised to benefit from this favourable environment.

Key Risks Delay in monetisation benefit from digitisation.

Rise in new investments may pressurise margins longer than expected.

Slowdown in ad spends due to lower than expected GDP growth.

7 Edelweiss Securities Limited Media

Financial Statements Key Assumptions Income statement (INR mn) Year to March FY18 FY19 FY20E FY21E Year to March FY18 FY19 FY20E FY21E Macro Net revenue 66,857 79,249 86,625 97,260 GDP(Y-o-Y %) 6.7 7.1 7.1 7.3 Direct costs 25,275 30,758 34,141 38,409 Inflation (Avg) 3.6 3.7 4.0 4.5 Employee costs 6,657 7,249 8,119 9,134 Repo rate (exit rate) 6.0 6.3 5.8 5.8 Total SG&A expenses 14,164 15,692 17,418 19,422 USD/INR (Avg) 64.5 70.0 72.0 72.0 EBITDA 20,761 25,550 26,946 30,296 Sector Depreciation 1,821 2,347 2,709 3,009 TV industry ad gr (%) 15.0 15.0 15.0 14.0 EBIT 18,941 23,203 24,237 27,287 TV industry sub. gr (%) 20.0 20.0 15.0 12.0 Less: Interest Expense 1,448 1,304 976 834 Company Add: Other income 4,403.00 2,514.5 2,638.03 2,654.82 Ad revenue growth (%) 14.5 19.8 8.0 11.0 Profit Before Tax 23,174 24,321 25,899 29,108 Domestic sub rev gr (%) (10.1) 17.3 20.0 18.0 Less: Provision for Tax 8,409 8,673 6,193 7,335 Internat sub rev gr (%) (11.5) (0.6) 2.0 5.0 Add: Exceptional items 1,279 (92) - - Othr oper inc (% of rev) 6.8 7.4 6.0 5.7 Associate profit share 12 24 24 24 Cost assumptions Reported Profit 14,777 15,673 19,731 21,797 Trans costs (% of rev) 37.8 38.8 39.4 39.5 Exceptional Items 1,279 (92) - - Personnel cost(% of rev) 10.0 9.1 9.4 9.4 Adjusted Profit 13,499 15,764 19,731 21,797 Sell & Adm exp(% of rev) 21.2 19.8 20.1 20.0 Shares o /s (mn) 960 960 960 960 Financial assumptions 0.1 0.1 0.1 - Diluted shares o/s (mn) 960 960 960 960 Tax rate (%) 38.4 35.5 25.2 25.2 Adjusted Diluted EPS 14.1 16.4 20.6 22.7 Capex (INR mn) 6,571 2,180 3,900 2,140 Dividend per share (DPS) 1.4 3.5 4.4 2.3 Debtor days 76 77 92 95 Dividend Payout Ratio(%) 16.2 25.9 25.9 12.1 Inventory days 312 384 400 400

Payable days 143 157 140 145 Common size metrics Cash conversion cycle 245 305 352 350 Year to March FY18 FY19 FY20E FY21E Dep. (% gross block) 11.6 11.0 12.0 12.0 S G & A expenses 21.2 19.8 20.1 20.0 Direct Cost 37.8 38.8 39.4 39.5 EBITDA margins 31.1 32.2 31.1 31.1 Net Profit margins 20.2 19.9 22.8 22.4

Growth ratios (%) Year to March FY18 FY19 FY20E FY21E Revenues 3.9 18.5 9.3 12.3 EBITDA 7.8 23.1 5.5 12.4 Adjusted Profit 10.9 16.8 25.2 10.5 EPS 23.2 16.8 25.2 10.5

8 Edelweiss Securities Limited Zee Entertainment Enterprises

Balance sheet (INR mn) Cash flow metrics As on 31st March FY18 FY19 FY20E FY21E Year to March FY18 FY19 FY20E FY21E Share capital 961 961 961 961 Operating cash flow 5,544 821 18,168 18,812 Reserves & Surplus 74,657 88,279 102,027 120,609 Financing cash flow (10,902) (9,247) (10,016) (3,215) Shareholders' funds 75,617 89,239 102,988 121,569 Investing cash flow (10,497) 1,636 (3,900) (2,451) Minority Interest 142 143 143 143 Net cash Flow (15,855) (6,790) 4,252 13,145 Long term borrowings 11,453 7,429 3,395 3,395 Capex (6,571) (2,180) (3,900) (2,140) Short term borrowings 6,382 11,734 11,734 11,734 Dividend paid (2,399) (4,056) (5,106) (2,631) Total Borrowings 17,834 19,163 15,129 15,129

Long Term Liabilities 892 1,350 1,350 1,350 Profitability and efficiency ratios Def. Tax Liability (net) 1,996 1,262 1,262 1,262 Year to March FY18 FY19 FY20E FY21E Sources of funds 96,481 111,157 120,873 139,454 ROAE (%) 18.9 19.1 20.5 19.4 Gross Block 12,432 13,911 17,411 19,911 ROACE (%) 25.0 25.1 23.4 23.2 Net Block 7,560 7,510 8,920 9,031 Inventory Days 312 384 400 400 Capital work in progress 920 1,561 1,561 1,200 Debtors Days 76 77 92 95 Intangible Assets 7,202 6,635 6,414 5,796 Payable Days 143 157 140 145 Total Fixed Assets 15,682 15,706 16,895 16,027 Cash Conversion Cycle 245 305 352 350 Non current investments 1,593 1,189 1,189 1,500 Current Ratio 6.3 6.2 7.3 7.6 Cash and Equivalents 29,813 20,794 25,048 38,194 Gross Debt/EBITDA 0.9 0.8 0.6 0.5 Inventories 26,278 38,505 37,415 42,092 Gross Debt/Equity 0.2 0.2 0.1 0.1 Sundry Debtors 15,365 18,274 21,834 25,314 Adjusted Debt/Equity 0.5 0.4 0.3 0.3 Loans & Advances 4,226 12,189 12,189 12,189 Net Debt/Equity 13.1 17.8 24.8 32.7 Other Current Assets 18,341 22,672 22,672 22,672

Current Assets (ex cash) 64,210 91,641 94,111 102,268 Operating ratios Trade payable 11,497 14,897 13,095 15,258 Year to March FY18 FY19 FY20E FY21E Other Current Liab 3,319 3,276 3,276 3,276 Total Asset Turnover 0.7 0.8 0.7 0.7 Total Current Liab 14,816 18,173 16,371 18,534 Fixed Asset Turnover 5.6 5.5 5.9 6.4 Net Curr Assets-ex cash 49,395 73,468 77,740 83,734 Equity Turnover 0.9 1.0 0.9 0.9 Uses of funds 96,481 111,157 120,873 139,454

BVPS (INR) 78.8 93.0 107.3 126.6 Valuation parameters Year to March FY18 FY19 FY20E FY21E

Free cash flow (INR mn) Adj. Diluted EPS (INR) 14.1 16.4 20.6 22.7 Year to March FY18 FY19 FY20E FY21E Y-o-Y growth (%) 23.2 16.8 25.2 10.5 Reported Profit 14,777 15,673 19,731 21,797 Adjusted Cash EPS (INR) 16.0 18.9 23.4 25.8 Add: Depreciation 1,821 2,347 2,709 3,009 Diluted P/E (x) 18.8 16.1 12.9 11.6 Interest (Net of Tax) 892 841 730 624 P/B (x) 3.4 2.8 2.5 2.1 Others (3,395) (749) (730) (624) EV / Sales (x) 3.6 3.2 2.8 2.4 Less: Changes in WC 8,551 17,290 4,272 5,994 EV / EBITDA (x) 11.7 9.9 9.1 7.6 Operating cash flow 5,544 821 18,168 18,812 Dividend Yield (%) 0.5 1.3 1.7 0.9

Less: Capex 6,571 2,180 3,900 2,140 Free Cash Flow (1,027) (1,359) 14,268 16,671

Peer comparison valuation Market cap Diluted P/E (X) EV / EBITDA (X) ROAE (%) Name (USD mn) FY20E FY21E FY20E FY21E FY20E FY21E Zee Entertainment Enterprises - 12.9 11.6 9.1 7.6 20.5 19.4 Sun TV Network - 11.7 11.1 7.1 6.5 29.5 29.0 Median - 12.3 11.4 8.1 7.0 25.0 24.2 AVERAGE - 12.3 11.4 8.1 7.0 25.0 24.2 Source: Edelweiss research

9 Edelweiss Securities Limited Media

Additional Data Directors Data Managing Director & CEO Prof. Sunil Sharma Independent Director Prof. (Mrs.) Neharika Vohra Independent Director Manish Chokhani Independent Director Adesh Kumar Gupta Independent Director Ashok Kurien Non Executive Director Subodh Kumar Non Executive Director Non Executive Chairman

Auditors - M/S Deloitte Haskins & Sells LLP *as per last annual report

Holding – Top10 Perc. Holding Perc. Holding Aditya birla sun life 1.77 ICICI Prudential 1.24 Invesco ltd 7.88 Vanguard group 5.69 Life insurance corp 4.89 Schroders plc 3.23 Blackrock 1.86 Vontobel holding ag 2.28 Vontobel india fund 2.26 Virtus investment pa 2.25

*in last one year

Bulk Deals Data Acquired / Seller B/S Qty Traded Price 08 May 2019 CATALYST TRUSTEESHIP LIMITED SELL 8600000 342.33 01 Feb 2019 CATALYST TRUSTEESHIP LIMITED SELL 7400000 361.42 28 Jan 2019 DVI FUND MAURITIUS LTD BUY 8969248 343.05

*in last one year

Insider Trades Reporting Data Acquired / Seller B/S Qty Traded 02 Apr 2019 Essel Corporate Llp Sell 2317035.00 02 Apr 2019 Cyquator Media Services Private Limited Sell 5317839.00 14 Feb 2019 Cyquator Media Services Private Limited Sell 830150.00 05 Feb 2019 Essel Corporate Llp Sell 8145000.00 05 Feb 2019 Cyquator Media Services Private Limited Sell 16240225.00

*in last one year

10 Edelweiss Securities Limited RATING & INTERPRETATION

Company Absolute Relative Relative Company Absolute Relative Relative reco reco risk reco reco Risk DB Corp HOLD SU M DEN Networks HOLD SU H Dish TV India HOLD SU M Cable & Datacom HOLD SP M Jagran Prakashan HOLD SU M PVR BUY SO M Sun TV Network BUY SO H Zee Entertainment Enterprises BUY SP M

ABSOLUTE RATING

Ratings Expected absolute returns over 12 months

Buy More than 15%

Hold Between 15% and - 5%

Reduce Less than -5%

RELATIVE RETURNS RATING

Ratings Criteria Sector Outperformer (SO) Stock return > 1.25 x Sector return

Sector Performer (SP) Stock return > 0.75 x Sector return

Stock return < 1.25 x Sector return

Sector Underperformer (SU) Stock return < 0.75 x Sector return

Sector return is market cap weighted average return for the coverage universe within the sector

RELATIVE RISK RATING

Ratings Criteria

Low (L) Bottom 1/3rd percentile in the sector

Medium (M) Middle 1/3rd percentile in the sector

High (H) Top 1/3rd percentile in the sector

Risk ratings are based on Edelweiss risk model

SECTOR RATING

Ratings Criteria Overweight (OW) Sector return > 1.25 x Nifty return

Equalweight (EW) Sector return > 0.75 x Nifty return

Sector return < 1.25 x Nifty return

Underweight (UW) Sector return < 0.75 x Nifty return

11 Edelweiss Securities Limited Media

Edelweiss Securities Limited, Edelweiss House, off C.S.T. Road, Kalina, – 400 098. Board: (91-22) 4009 4400, Email: [email protected]

Aditya Narain

Head of Research [email protected]

Coverage group(s) of stocks by primary analyst(s): Media DB Corp, DEN Networks, Dish TV India, Hathway Cable & Datacom, Jagran Prakashan, PVR, Sun TV Network, Zee Entertainment Enterprises

Recent Research

Date Company Title Price (INR) Recos

17 -Oct-19 PVR Growth juggernaut; 1841 Buy Result Update 17-Oct-19 DB Corp Pinning hopes on festive 153 Hold season; Result Update 16-Oct-19 Inox Leisure Setting the screen ablaze; 334 Buy Initiating Coverage

Distribution of Ratings / Market Cap Edelweiss Research Coverage Universe Rating Interpretation

Buy Hold Reduce Total Rating Expected to

Rating Distribution* 161 67 11 240 Buy appreciate more than 15% over a 12-month period * 1stocks under review Hold appreciate up to 15% over a 12-month period > 50bn Between 10bn and 50 bn < 10bn 743 Reduce depreciate more than 5% over a 12-month period Market Cap (INR) 156 62 11 594

One year price chart 446 600

(INR) 297 500 149 400

(INR)

- 300

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14

14

14

14

14

14

14

-

- -

-

-

-

-

- -

- - -

200

Jul

Jan

Jun

Oct

Apr

Sep Feb

Dec

Aug Nov

Mar May

100

18

19 19 18

19

18 19

19

19 19

19 19

19

-

-

- -

-

-

-

- - -

- -

-

Jul

Jan

Jun

Oct Oct

Apr

Feb Sep

Dec

Aug

Nov Mar May Zee Entertainment Enterprise

12 Edelweiss Securities Limited

Zee Entertainment Enterprises

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Media

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14 Edelweiss Securities Limited Zee Entertainment Enterprises

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