The Nifty Media index jumped 11 percent on Wednesday with sharp gains in the major stocks. The index gained the most among sectoral indices on the NSE today.
Among the stocks on Nifty Media, Zee Entertainment Enterprises gained over 20 percent, followed by an 8 percent rise in shares of TV18 Broadcast, 7 percent in Dish TV India and a 6 percent upmove in Network18 Media & Investments.
Top constituents by weightage are ZEEL (nearly 27 percent), TV18 Broadcast (10.5 percent), Dish TV India (7 percent) and Network18 Media & Investments (5 percent).
The rise in ZEEL share price came after the company's board approved a merger deal with Sony Pictures India.
"The recent announcement of a deal with Sony will be a very positive trigger for Zee ltd as it will have a quality promotor and that will ease the issue of corporate governance in the company. Though the deal is a nonbinding agreement so it will take some time for more clarity but this deal will bring a good synergy for both the company to grow their businesses and the combined entity will become the largest player in the industry," said Santosh Meena, Head of Research at Swastika Investmart.
"The stock is trading at very attractive valuations and it is one of the strongest and FIIs favourite stocks in the media space and if this deal concludes then we may see a big rerating in the counter," said Meena.
Prospects of a management reshuffle in ZEEL had driven the stock higher last week with other media stocks also getting a leg-up. Nifty Media had then risen around 8 percent.
At 10:56 am, Nifty Media index was up 9.1 percent at 2,119.5. Shares of ZEEL, TV18 Broadcast, Dish TV India and Network18 Media & Investments were 6-18 percent higher.
