Zee Entertainment in focus, here’s why

As per the on-binding agreement, Zee will hold 47 percent and Sony India will hold 53 percent in the merged entity.

Pains me to see relationship with Invesco going sour; want better tomorrow for Zee: Punit Goenka

Globally mergers have seen revenue synergies around 6-7 percent and the management is expecting similar kind of synergies for the merged entity.

Also, Zee will focus on maintaining ROCE at current levels.

Additionally, going ahead Zee is expected to see potential benefit strongly from the revival in ad spending and management after their Q2FY22 earnings clearly indicated that ad revenues will go back to pre-COVID levels not only for Zee but at industry level.

Also Read: Zee Ent-Sony deal: Brokerages say merged entity may emerge as 2nd largest home-grown OTT

Zee, also, managed to gain market share by 70 basis points (bps) during the last quarter on new launches and is further expecting market share in the upcoming quarters.

The stock is up 12 percent so far this month, up 50 percent so far this year and is trading at 16 times one-year forward versus 9-10 times post this deal announcement.