Shareholders will decide if I’m fit to run this company: Zee’s Punit Goenka

Goenka’s five year term as MD and CEO is set to end in December 2024.

As Punit Goenka’s five year term as MD and CEO is set to end in December 2024, he has not discussed his appointment or reappointment with any shareholder. 

Speaking to analysts during the company’s Q4 earnings call on Friday, he said, “The shareholders will decide whether I'm fit to run this company or not. I do not believe I have to reach out to them to agree on markers and other things… So at the end of the day, it is the shareholders who will decide whether I am the right person or not or somebody else needs to lead this company.”

Goenka, who is the longest-serving CEO of Zee, was reappointed as the MD and CEO of the entertainment giant in 2019. In August 2023, the Securities and Exchange Board of India (SEBI) passed a confirmatory order against Goenka and Chandra, barring them from holding directorships or top managerial roles in Zee, for allegedly diverting the company's funds to promoter-owned firms.

The Securities Appellate Tribunal (SAT) lifted the ban in October 2023, but has allowed the regulator to continue its probe against the Zee promoters.

After over two years of talks with Sony for a proposed merger, the companies terminated their agreement in January 2024. On April 16, Zee withdrew its application from the National Company Law Tribunal (NCLT) that sought the implementation of the merger agreement.

During the earnings call, Goenka said this decision will enable the company to sharply focus on growth and strategic opportunities in order to generate higher value for all shareholders. 

“That said, the company will continue to aggressively pursue the arbitration proceedings at the Singapore International Arbitration Center and in other forums,” he said.

The company’s focus in the quarter gone by has been firmly on enhancing the performance and the profitability levels of the company in order to achieve the targeted EBITDA margin of 18-20% by 2026. As part of its efforts to reduce costs it has terminated 15% of its staff.

“We have taken concerted efforts in every required direction to ensure that we remain frugal, optimize our resources and maintain a sharp focus on quality content across the business. We have been implementing a series of steps since the latter half of the quarter, results of which will reflect in the bottom line in the financial year 2025,” he said.

On May 17, 2024, Zee Entertainment Enterprises reported a net profit of Rs Rs 13.35 crore for the quarter ended March 2024, compared to a loss of Rs 196 crore in the same quarter in 2023.

Total income for the quarter has increased by 3% year-on-year to Rs 2,185 crore, compared to Rs 2,126 crore in the same quarter of 2023.