Zee Entertainment - Merger Dissolution With Sony Will Lead To De-Rating: Prabhudas Lilladher

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Prabhudas Lilladher Report.We downgrade our rating to ‘Reduce’ from 'Buy' with revised target price of Rs 151 after assigning a multiple of 12 times to our Sep-25 earnings per share of Rs 13 as Sony has terminated its merger cooperation agreement with Zee Entertainment Enterprise Ltd.’s. Apart from sharp de-rating in valuation multiple, we believe dissolution of merger will not only result in a financial strain on Zee on account of termination charge, but also creates an uncertainty surrounding the pay-out relating to ICC rights putting its sports aspirations on backburner. In addition, Zee is now saddled with irreversible sunk cost of Rs 3.7 billion incurred towards merger. We believe de-rating in valuation multiple will be sharp as governance discount would now come into play and apt benchmarking history would be a year prior to Covid. .Downgrade to ‘Reduce’ as dissolution has not only brought governance risks to the fore, but has also weakened Zee’s competitive positioning in a market which is under consolidation mode..Click on the attachment to read the full report:.Subhash Chandra Accused SEBI Of Trying To Scuttle Zee-Sony Merger.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit. .Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

Zee Entertainment - Merger Dissolution With Sony Will Lead To De-Rating: Prabhudas Lilladher

Sony sends merger dissolution letter to Zee and seeks a termination fee of $90 million.

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Zee Entertainment - Merger Dissolution With Sony Will Lead To De-Rating: Prabhudas Lilladher

Sony sends merger dissolution letter to Zee and seeks a termination fee of $90 million.

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