“Third quarter is normally a strong growth period for us. However, tough macroeconomic environment led to a decline in ad revenues,” Punit Goenka, managing director and chief executive officer of ZEEL said.
According to the management, the domestic ad revenue was hit by the persisting slowdown in the key consumer sectors. It, however, expects the revenue to revive from the next quarter.
"As the volume growth for most consumer companies did not see any uptick during the quarter, they cut advertising spends to protect their margins... The festive month of October saw a pick-up in advertising spends, but the growth slumped after that," it said in a statement.
The subscription revenue, however, grew 15.4 per cent to Rs 713.7 crore in Q3FY20, riding primarily on last February's new tariff order (NTO)-induced changes in subscription patterns. Zee's India subscription revenue grew 21.7 per cent to Rs 631 crore, the company said.
The company's total expenses were up 3 per cent YoY.
At 10:02 am, the stock was trading 3 per cent lower at Rs 275.15 apiece, as against a 0.16 per cent gain in the S&P BSE Sensex. A total of 10.6 million shares have changed hands on the counter on NSE and BSE till the time of writing of this report.
During the company's conference call, the management said that the Audit Committee has begun internal audit in the Related Party Transaction (RPT).