The growth came on the back of a strong 23% jump in consolidated operating revenues at Rs 1,659 crore over September quarter last year
India's leading entertainment company Zee Entertainment Enterprises Ltd (Zeel) reported a 28.3% year-on-year growth in profit after tax and exceptional items at Rs 244 crore for the second quarter of fiscal 2017. The growth came on the back of a strong 23% jump in consolidated operating revenues at Rs 1,659.4 crore over September quarter last year.
Commenting on the overall results, Dr Subhash Chandra, chairman, Zeel, said, "Zee reported well-rounded strong growth in revenues during the first half of fiscal 2017. While we continue to add new channels to our domestic and international broadcasting businesses our new initiatives in movies, music, events and digital are taking shape and have started contributing to growth."
Chandra added that initial signs of an uptick in Indian economy were already visible. "We should see improvement in economic growth in quarters ahead. Normal monsoon in 2016 after a gap of two years should spur the rural growth. The passage of GST bill is a positive step and would help Indian economy," he said.
Advertising revenues grew 15.7% to Rs 959.2 crore during the August to September 2016 quarter of which a majority i.e. Rs 880 crore was from the domestic business while international contributed the balance Rs 79.2 crore. Subscription revenues at Rs 583.3 crore increased 21.7% over same period last fiscal of which domestic subscription revenues stood at Rs 467.5 crore and Rs 115.8 crore came from international subscription revenues. The company's earnings before interest, tax, depreciation and amortisation (Ebitda) for the quarter was Rs 489.2 crore. The Ebitda and PAT margins stood at 28.9% and 14.4% respectively.
Punit Goenka, managing director and chief executive officer, Zeel, said, "Our advertising revenues continue to grow ahead of the market on the back of improving viewership share and better monetisation of our bouquet. Growth in domestic subscription revenue was aided by catch up revenue in Q2."
Goenka added that the Telecom Regulatory Authority of India (Trai) has released draft regulations for broadcasting services and interconnection arrangement to increase transparency in content pricing and payment of carriage and to allow consumers to choose channels. "These draft regulations are steps in the right direction and propose a host of changes to the existing system. Although it still remains to be seen what form the final regulation will take, we hope that improved transparency will enable various stakeholders to get their rightful share in subscription revenues," he said.
The first half of fiscal 2017, Goenka said, has been strong for the company and that growth in advertisement spends has held up so far. "Moderation in FMCG and e-commerce spends might have some impact on industry growth in the coming quarters. On the positive side increasing competition in telecom business would help ad spend growth. GST roll-out in the coming year could boost advertising spends as a part of potential savings in tax outgo might be reinvested," he said.
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 "Dr Subhash Chandra")
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