GECs
Morgan Stanley bullish on Zee FPC revamp
NEW DELHI: Has Zee Telefilms, almost always in the news for all the wrong reasons, seemingly hit the winning strategy via its latest programming revamp?
Morgan Stanley believes that the revamp is different from the past and may succeed if the whole strategy is executed well. “The latest revamp appears to be well thought out, different and interesting, in our view. We believe that the downside from the current strategy will be limited,” says Morgan Stanley’s recent report on Zee Telefilms, a copy of which is available with indiantelevision.com.
“The current (programming) revamp is different from those in the past and we like this. The management appears to be moving in the right direction, in our view,” states the report, dated 3 October. It further adds that the company, which has made changes in the past two years, had been unable to deliver the goods for various reasons. However the company has significantly improved the quality of its primetime content in the past six months, and two programs are now among the Top 100.
The report further clarifies that the two (Zee) prime-time programmes (in the Top 100) have not yet been able to garner viewership anywhere close to that of leader Star’s prime-time shows.
Zee Telefilms’ new strategy for flagship Zee TV entails Thursday premieres of recently released and unreleased Hindi movies and appointment viewing by broadcasting weekly primetime programmes starting from Sunday to Wednesday rather than Monday to Thursday on the flagship channel.
“The acquisition cost of the 16 movies was not disclosed by the (Zee) management. We believe that it is likely to be in the Rs 300-330 million range,” the reports adds.
Commenting on Zee Management’s claim that the revamp backed by extensive research, will be an effective strategy , Morgan Stanley believes that the upside from the revamp could be “significant for the company’s sagging broadcasting business.”
The report goes on to say that success depends on the management’s ability to effectively market the changes and new programs to viewers, advertisers and media buyers, which was not done in the past. “Whether the consumer accepts the changes in viewing patterns and habits will be key for the company’s new strategy,” it has been argued.
But sounding a word of caution, Morgan Stanley has also stated that movies, especially newly released movies, always attract audiences irrespective of the channel on which they are broadcast but they do not build channel loyalty.
“While Zee TV may succeed in increasing its viewership on Thursdays, it is unlikely to bring viewers to its channel for other primetime shows, in our view. The movies will likely increase revenues as Zee TV will probably gain viewership share. We believe that the viewership for movies will likely be higher than that for Zee’s current shows,” the report says.
More importantly, Morgan Stanley analysts say that profits from movies may be frontloaded and substantial as the company plans to recover the entire cost of acquisition in the first screening, while the cost will be amortized over five years or period of rights acquired, whichever is less.
Zee TV has already signed in four associate sponsors for the movies – Coca-Cola, Cadbury India, Whirlpool and Paras. “The company will also be able to exploit these rights on Zee Cinema and in the international markets,” the report states, dwelling on the importance of the movie rights acquired.
Zee Telefilms is India’s largest vertically integrated media and entertainment company, with revenues of $ 220 million and a presence in film, music and education. It is a large producer and aggregator of Hindi programming, with an extensive library housing television, news content and movie titles. Zee is also one of the largest cable distributors in the country through its wholly owned subsidiary, Siti Cable.
According to the Zee management’s own research, audience availability on weekends is the same as weekdays, but the weekend programme viewership is “highly fragmented on account of lack of quality content.” Thus, it is trying to bring in audiences to sample its prime time content on Sundays and to retain them until Wednesday. The Sunday rationale is that it is the least competitive slot and inventory is currently used for bonusing (free airtime for commercials) inventory. Airing primetime content on Sunday will allow higher viewership to be gained as well as revenues, according to the management, says the report.
Stating reasons as to why authors of the report are not confident of the success of the aforementioned strategy are as follows:
# it requires viewers to change their habits of appointment viewing
# Sunday is not a routine day for women and
# the entire family is at home and may have other plans for the evening entertainment.
“Predicting which shows will succeed and which will fail in the media business is very difficult,” the report adds. Morgan Stanley expects the company’s earnings to grow at 31 per CAGR (compounded annual growth rate) over the next two years and be mainly driven by growth in the domestic subscription business.
“We like the stock on account of its recent underperformance, attractive valuation and the company’s strong earnings growth,” the report says.
The Morgan Stanley report, as a footnote has also said that the present offering does not provide individually tailored investment advice. It has been prepared without regard to the individual financial circumstances and objectives of persons who receive it.
GECs
Sahara One reports financial results, notes director exit and business realignment
Muted revenues, steady expenses and strategic adjustments shape company’s current phase
MUMBAI: In a tale where the sands seem to be slipping faster than they can be gathered, Sahara One Media and Entertainment Limited has reported another quarter of wafer-thin income and widening losses, even as a boardroom exit adds to the unease.
The company informed the Bombay Stock Exchange that its board, in a meeting held on April 4, approved its unaudited financial results for the quarter ended September 30, 2025. The numbers paint a stark picture. Total income for the quarter stood at just Rs 0.13 lakh, unchanged sequentially and sharply down from Rs 0.26 lakh a year earlier.
Losses, meanwhile, deepened. The company posted a net loss of Rs 24.16 lakh for the quarter, compared to Rs 18.81 lakh in the June quarter and Rs 39.69 lakh in the same period last year. For the six months ended September 2025, the cumulative loss stood at Rs 39.69 lakh, while the full-year loss for FY25 was reported at Rs 60.72 lakh.
Expenses continued to outweigh income by a wide margin. Total expenses for the quarter came in at Rs 24.30 lakh, led by employee benefit costs of Rs 6.51 lakh and other expenses of Rs 17.78 lakh. Earnings per share remained in the red at Rs (0.11) for the quarter.
The balance sheet reflects a company with significant assets on paper but limited operational momentum. Total assets stood at Rs 23,065.57 lakh as of September 30, 2025, broadly unchanged from March 2025. Equity share capital remained steady at Rs 2,152.50 lakh, while total equity was reported at Rs 18,004.85 lakh.
Cash and cash equivalents saw a modest uptick to Rs 6.75 lakh from Rs 4.68 lakh earlier, supported by a positive operating cash flow of Rs 180.01 lakh for the period.
Yet, beneath these numbers lies a more complex narrative. The company’s auditors flagged their inability to obtain sufficient evidence to form a conclusion on the financial statements, citing lack of access to records. They also raised concerns over the company’s ability to continue as a going concern, pointing to insufficient funds, delayed recoveries, and stalled content investments.
Adding to the governance overhang, the company disclosed that Rana Zia has resigned as whole-time director, effective October 16, 2025, citing other professional commitments. The resignation, noted and accepted by the board, also brings an end to her role across company committees.
Regulatory pressures continue to loom large. The Securities and Exchange Board of India has already initiated penal actions for non-compliance with listing norms, with trading in the company’s shares remaining suspended. There is also a risk of promoter demat accounts being frozen.
Legacy legal issues remain unresolved. A substantial deposit of Rs 694,027.88 thousand linked to the long-running OFCD dispute involving Sahara group entities is still under the purview of the Supreme Court of India. Restrictions on asset disposal continue to weigh on the company’s financial flexibility.
Operationally, challenges persist across multiple fronts. Advances worth Rs 1,92,916 thousand given for film content remain stuck, with delays in project completion and uncertain recoverability. The company’s YouTube channel, despite being operational, has generated no revenue for over three years due to compliance lapses. In a further twist, management has indicated that revenues may have been fraudulently diverted through unauthorised changes to its AdSense account, with a police complaint in the works.
There are also missed revenue opportunities. Television content rights continue to be used by a related party despite the expiry of the licence agreement, with fresh negotiations still underway.
For now, Sahara One Media and Entertainment Limited appears caught between legacy disputes and present-day operational hurdles. As losses linger and governance questions mount, the road to recovery looks less like a sprint and more like a slow trudge through shifting sands.
