ZEE CEO Punit Goenka Optimistic About Budget 2025 Boosting Ads

Punit Goenka, CEO of Zee Entertainment, expressed optimism that the upcoming Union Budget will include measures to revive the consumption cycle and boost the industry. During the Q3 earnings call on January 23, Goenka acknowledged that the broader macroeconomic environment continues to pose challenges.

Goenka stated, “The green shoots we witnessed during the beginning of the quarter did not pick up the required pace to drive a positive growth momentum. This coupled with the muted spending by FMCG brands in a festive quarter further slowed the pace of growth for the industry at large. Although there was a marginal pickup in the rural recovery, the lackluster sentiment in the urban market led to weaker demand and impeded significant growth. This in turn also impacted our advertising revenues during the quarter.”

He is hopeful that the measures outlined in the Budget will boost consumption, creating positive momentum for recovery. He maintains an optimistic outlook for a gradual recovery in the new fiscal year, which will allow the network to benefit from the anticipated rise in advertiser spending.

In its Q3 report, the company attributed an 8.4 percent decline in advertising revenue to Rs 940 crore to lower spending by FMCG companies. However, subscription revenue saw positive growth, rising by 7 percent to Rs 982.5 crore, fueled by both linear subscriptions and an increase in subscribers to the ZEE5 streaming service.

ZEE5 has made significant strides in boosting both subscriptions and margins. The company is implementing clear measures to drive growth in the digital space after carefully reassessing its cost structure.

Further, Goenka mentioned that “During the quarter the subscription revenues continue to post a healthy growth. In line with the Telecom Regulatory Authority of India (TRAI) tariff regulations, we have published a new Reference Interconnect Offer (RIO) that reflects the competitive pricing approach adopted by the company. We expect subscription revenues to continue growing after a couple of quarters of implementation.”

On the linear side, Zee Entertainment's language markets continue to perform strongly, showing positive results. The company is also seeing growth in the Marathi market, where it has “invested significant amounts of time and energy over the last few quarters to identify and fill in the required gaps.”

Goenka mentioned that the company is focused on strengthening its Hindi programming and is making significant investments in content to increase value for its customers.

He also highlighted the lateral leadership team structure, introduced in April 2024, which allows the company to concentrate its efforts on each business segment. Goenka expressed optimism about the company’s future, confident that it will continue to perform strongly across all areas.

Furthermore, he added, “At a macro level we are maintaining a sharp eye on the profitability levels and investing for long-term growth. We have identified the gaps and our teams are working around the clock to innovate and build solutions that will enhance the company's competitive advantage in the market. The company remains on firm footing to drive robust growth in the future with a balanced investment approach.”

During the first three quarters of this fiscal year, the company focused on strengthening its core operations and adjusting strategies to improve performance and profitability. Several targeted actions were taken, leading to a year-over-year expansion in margins.

“The fiscal prudence exercised across the company has served us well, enabling us to maintain a firm grip on the margin profile and balance sheet. The first phase of our overall strategic road map centered around costs and margins has been successfully executed and our energies are focused towards boosting growth and performance,” he said.