Punit Goenka Optimistic About Revival Measures in Upcoming Union Budget

 Zee Entertainment CEO, Punit Goenka, has expressed hope that the upcoming Union Budget will introduce measures to revive consumption and drive industry growth. Speaking during the Q3 earnings call on 23 January, Goenka acknowledged the challenges posed by the current macroeconomic environment.

“The green shoots observed at the start of the quarter didn’t gain the necessary momentum to sustain growth. Muted spending by FMCG brands during the festive season further slowed the industry's progress. While rural recovery showed signs of improvement, weak urban sentiment dampened demand, impacting advertising revenues for the quarter,” he stated.

Goenka remains optimistic that budgetary measures will help stimulate consumption, creating a positive momentum for recovery. He anticipates a gradual revival in the new fiscal year, enabling Zee to benefit from increased advertiser spending.

The company's Q3 results highlighted an 8.4% drop in advertising revenue to ₹940 crore, attributed primarily to reduced FMCG spending. However, subscription revenue increased by 7% to ₹982.5 crore, driven by growth in both linear TV subscriptions and the ZEE5 streaming platform.

ZEE5 continues to perform well, with the company streamlining its cost structure to enhance digital margins. Additionally, the new Reference Interconnect Offer (RIO), published in accordance with TRAI’s tariff regulations, reflects Zee's competitive pricing approach and is expected to sustain subscription revenue growth in the coming quarters.

On the linear side, Zee’s regional language markets have maintained strong performance, with notable growth in the Marathi segment following targeted investments. The company is also strengthening its Hindi programming by making significant content investments to deliver greater value to its audience.

The introduction of a lateral leadership team structure in April 2024 has allowed focused efforts across various business segments. "We are closely monitoring profitability while strategically investing in long-term growth. Our teams are innovating to address gaps and enhance Zee’s competitive position in the market," Goenka explained.

During the first three quarters of the fiscal year, Zee prioritised reinforcing business fundamentals and improving profitability. These measures have led to year-on-year margin expansion.

“The fiscal prudence exercised across the company has enabled us to maintain a strong margin profile and balance sheet. We’ve successfully executed the first phase of our strategic roadmap, which centred on cost and margin management. Now, we are focusing on driving growth and enhancing performance,” he added.