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Analysts maintain a strong buy on Zee Entertainment Enterprises Ltd (ZEEL) shares, as Invesco seems to have softened its stance on the merger with Sony.
Sony, Zee to merge into blockbuster entity
Abneesh Roy, Executive Vice-President at Edelweiss Research, said, “We expect the Zee-Sony deal to be announced soon. We have been strongly pushing ZEE from 170 levels (seen in March to August period). Initially stock did not do well and there was hardly any acceptance of our bull call. Since then stock has doubled, We have the most aggressive TP on ZEE at 428. Currently ZEE stock is near its year-high levels, while most mid-caps have come off sharply.”
Clarity regarding promoter shares
BusinessLine earlier reported that Invesco will back the Zee-Sony merger as long as there is clarity on how promoters will increase their shares from 4 per cent to 20 per cent, wherein they want the promoters to only be allowed to increase them through open market purchase, without any dilution for other shareholders.
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Another industry source close to the merger told BusinessLine that Punit Goenka, MD and CEO, ZEEL, is unlikely to get any preferential equity and may acquire the additional stake from the open market.
Analysts expect the Zee-Sony merger deal to be announced soon.
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