Cable TV
Zee Telefilms creates 3 new business entities; to list them
MUMBAI / NEW DELHI: The Subhash Chandra promoted Zee Telefilms board today approved splitting of its broadcasting business into three entities — news operations, broadcast and content creation, and Siti Cable, which will also include the initiatives on the CAS front.
After the restructuring, which is expected to be completed within six to eight months, the new entities involved in cable business, and news operations, would be listed on the stock exchange.
It also announced an ‘in principle’ approval of a proposal to demerge the consumer services business for Dish TV. The board of directors has approved the restructuring proposal related to the de-merger of news and cable business while directing the management to evaluate the direct consumer services business (Dish TV related) and the assess the effect of de-merging it.
According to Zee Telefilms chairman Subhash Chandra, the company had a complex structure, which needed to be simplified as required by the regulatory environment and market needs.
* ZTL holds 33 per cent in Zee News Limited, while promoters of Zee hold the balance. Zee News Ltd delivers news uplinked fto the satellite for Zee News, Zee Business and News content of regional channels.
He added, “Due to regulatory restrictions, the business of Dish TV was structured in a very fractured manner and hence was difficult for ZTL shareholders to understand.
“At the same time, the structure was also tax inefficient. The management of the businesses under the same board was not focused and thus unable to capture the growth opportunities in the market as different skill sets are required for distribution to trade, which in this case is cable business.”
He continues that the regulation in the news and news related broadcast content is different from regulation in entertainment and other content.
Due to technological advancements and changes, the media businesses have to be prepared for a forthcoming digital age, the company said.
“We feel confident that these measures of restructuring these businesses subject to necessary approval would result in streamlining operations and better exploitation of opportunities in each area to build long term shareholder value. It would also clear the ground for acquisitions and strategic or financial partners in the demerged businesses, apart from unlocking shareholders value,” Chandra says.
Queried as to whether he saw the demerged cable business (Siti Cable) and the direct consumer services business (Dish TV) as being the most likely to invite international interest for strategic and financial partnerships, Chandra replied in the affirmative.
Restructuring of consumer business for Dish TV
The direct consumer business is marked by division of activities between the DTH license holder ASC Enterprises Limited (ASCEL) and the subsidiaries of Siti Cable.
* Percentage holding to be decided by the board after valuation by independent valuers.
As per the proposal, the direct consumer related business of ZTL would be de-merged into ASCEL, with the shareholders of ZTL receiving shares in ASCEL in proportion.
This has been done due to lack of clarity in structure, inefficiencies in tax and diffuse strategic focus.
The proposal has met with in principle approval of the Zee board. The board has authorised management to evaluate the proposal and its effect and present to board for final approval.
The scheme of arrangement would require approval of the stock exchange, shareholders and creditors of Zee and from Bombay High Court.
Restructuring of news business; regional channels included
# ZTL shareholders would get 137 shares of Zee News Ltd for 100 shares in ZTL. ZTL foreign shareholders will get upto a maximum of 26 per cent. Any additional shares accruing would be converted into Preference Shares. Currently the FII holding is 31 per cent, hence everyone will get equity shares. The equity shares held by foreign promoters would be shifted to India as domestic holdings.
In compliance with the news uplinking guidelines with effect from October 2005, newsgathering activities of ZTL were transferred to Zee News Limited, while downlinking and commercial exploitation of all news-bearing channels was retained under ZTL.
“Despite a compliant corporate structure for news bearing channels (particularly regional channels), we have felt it important to bridge the divide and bring all the operational activities together, to create strategic focus, remove tax efficiencies and unlock shareholders value,” Chandra said.
Under the scheme of arrangement, the news-related business (Zee News, Zee Business, Zee Bangla, Zee Punjabi, Zee Marathi, Zee Telegu and shortly to be launched Zee Kannada will be subsumed into Zee News Limited (ZNL).
The company will in due course be suitably changing the name of Zee News Ltd.
As the result of preparation of news business the shareholders of Zee Telefilms will get proportionate shareholding in ZNL. As per the formula that has been worked out 137 ZNL shares will fetch 100 shares in ZTL.
In case the allotment works out to more than 26 per cent (which is the permissible limit of foreign investment in news ventures in India), the FIIs would be allotted preferentail shares of equivalent value on a proportionate basis.
Zee News Limited would be listed on all stock exchanges where ZTL is listed.
Restructuring of cable business
Siti Cable has been hived off into a separate entity, Chandra pointed out, as the cable assets were under-utiliseted, despite large and well-positioned investments in the cable business.
To properly address the emerging business opportunities in digitisation of cable and convergence, there also are large funding requirements. And the regulatory requirement applicable to cable distribution is very different to broadcasting.
Combined with the fact that the competitive environment of distribution business is also different, the Zee board felt that an invigorated corporate and governance set up was essential to aggressively address the emerging opportunities.
* Shares held by foreign promoters will be shifted in India as domestic holding to bring down the overall foreign holding to about 35 per cent. Cable business is allowed foreign holding upto 49 per cent.
As per the scheme of arrangement, the cable business of Siti Cable, a 100 per cent subsidiary of ZTL, and the cable related business of ZTL would be de-merged into Wire and Wireless (India) Limited (WWIL), a new company incorporated for the purpose.
The shareholders of ZTL would receive shares in WWIL in proportion, as consideration.
WWIL would in turn issue preference shares to the shareholders of ZTL.
Meanwhile, the Zee scrip moved in a narrow band today. While opening at the BSE on 238.90, the scrip touched a high of 243.35 and a low of 236.10 before closing the day at 239.55. The stock is expected to react tomorrow as the restructuring of Zee’s businesses was announced in the evening, after the bourses had closed.
MY Khan joins Zee board
Dr MY Khan, chairman of Banking and Advisory Council, YES Bank Ltd, has joined Zee as a director on the board of the company. Dr Khan has previously served as chairman of J & K Bank. He is also a director on the Board of Bharat Hotels, as well as an advisor for Berenson & Company, New York.
MUMBAI: When margins wobble, liquidity talks and in Q3 FY25-26, cash did most of the talking. Den Networks Limited closed the December quarter with consolidated revenue of Rs.251 crore, marginally higher than the previous quarter but down 4 per cent year-on-year, even as profitability stayed resilient on the back of strong cash reserves and disciplined cost control.
Subscription income softened to Rs.98 crore, slipping 3 per cent sequentially and 14 per cent from last year, while placement and marketing income offered some cheer, rising 15 per cent quarter-on-quarter to Rs.148 crore. Total costs climbed faster than revenue, up 7 per cent QoQ to Rs.238 crore, driven largely by higher content costs and operating expenses. As a result, EBITDA dropped sharply to Rs.13 crore from Rs.19 crore in Q2 and Rs.28 crore a year ago, pulling margins down to 5 per cent.
Yet, the bottom line refused to blink. Profit after tax stood at Rs.40 crore, up 15 per cent sequentially and only marginally lower than last year’s Rs.42 crore. A healthy Rs.57 crore in other income helped cushion operating pressure, keeping profit before tax at Rs.48 crore, broadly stable quarter-on-quarter despite the tougher cost environment.
The real headline-grabber, however, sits on the balance sheet. The company remains debt-free, with cash and cash equivalents swelling to Rs.3,279 crore as of December 31, 2025. Net worth rose to Rs.3,748 crore, while online collections accounted for 97 per cent of total receipts, underscoring strong cash discipline across operations, including subsidiaries.
In short, while Q3 showed signs of operating strain, the financial backbone remains solid. With zero gross debt, steady profits and a formidable cash war chest, the company enters the next quarter with flexibility firmly on its side proving that in uncertain markets, balance sheet strength can be the best growth strategy.
