Zee should cut costs in profit pursuit: Panel

A new company-formed review panel by Zee Entertainment stated the firm should substantially reduce losses in its businesses, including its English TV channels, and cut costs in other areas to meet a key profit target, the broadcaster said on Tuesday.

The move — coming on the heels of a failed $10 billion merger with Sony India and the collapse of a $1.4 billion cricket broadcasting deal over a missed payment — is aimed at helping the loss-making company hit key performance targets, Zee said. That includes a 20 per cent earnings before interest, taxes, depreciation, and amortisation (Ebitda) margin target proposed by chief executive officer (CEO) Punit Goenka, Zee said. Its margin was 10.2 per cent in the December quarter.

Zee’s business has struggled over the years, with advertising revenue falling to $488 million for in 2022-23 (FY23) from around $600 million five years earlier. Cash reserves also dropped about 25 per cent in that period.

The committee — comprising company chairman R Gopalan and audit committee chairman Prakash Agarwal — has identified five businesses, including its English television channels, the Hindi channel Zindagi and communication technology-maker Margo Networks, where losses need to be substantially reduced, Zee said. Margo Networks lost ~117 crore in the year ended March 31, 2023. Zee did not provide details on the performance of the other businesses or respond to requests for comment. The committee has also advised halving the costs at Zee’s technology and innovation centre in FY25, from ~600 crore a year back, Zee said.