Zee Entertainment Enterprises (Z IN) – Q3FY26 Result Update – ZEE5 registers a turnaround – BUY
Published on 23 Jan 2026
Despite a turnaround in the digital business, we cut our EPS estimates by 17%/16% for FY27E/FY28E as recovery in linear TV business is expected to take longer than expected amid prolonged slowdown in FMCG spending. Z IN reported weak set of numbers as domestic ad-revenue declined for 7th quarter in a row with an EBITDA margin of 10.5% (PLe 12.0%). Led by improvement in viewership share (17.5% in 3QFY26; up 60 bps YoY) and continued momentum in the digital business we expect revenue CAGR of 5.2% over the next 3 years with EBITDA margin of 10.7%/15.5%/16.7% in FY26E/FY27E/FY28E. Backed by sharp earnings recovery and attractive valuations (9x/7.7x our FY27E/FY28E EPS) we maintain BUY with a TP of Rs133 (earlier Rs158). We have revised our target P/E multiple to 12x (earlier 14x) as we roll forward our valuation to FY28E.
