Zee Entertainment plunges 15% on profit booking on margin concerns

With high investment proposed in content from FY22 onwards, operating margins and cash flows could remain lower, say analysts

Shares of Zee Entertainment Enterprises (ZEE) dipped 15 per cent to Rs 212 on the BSE in the intra-day trade on Friday on profit booking as investors worried about shrinking operating profit margin. The stock has slipped 19 per cent from its 52-week high level of Rs 216 touched on Thursday, February 4.

"The incremental investments in a new channel, the Digital business, and the Movie business would lead to margin dilution, and the earlier guidance for a 30 per cent Ebitda (earnings before interest, taxes, depreciation, and amortisation) margin would be difficult to achieve," analysts at Motilal Oswal Financial Services