The Zee Group stock improved some of their losses in trade today after Subhash Chandra-led Essel Group on Sunday said it has "arrived at a sympathetic" with its lenders, which are having pledge on shares held by the promoter, not to be affirmed debtor following steep fall in share prices of planned entity such as Zee Entertainment and Dish TV.
The Zee Enterprises stock rose 14.29% to 365 in early trade compared to its previous close of 319.35 on the BSE.
The stock open with a gain of 9.99% at 351.25 levels on the BSE.
On Friday, Zee Entertainment Enterprises plunge 26.43 percent to Rs 319.35 on the BSE.
Zee Learn which lost 18.49 percent to Rs 27.55 on Friday hit an intraday high of 31 levels in trade today before falling 5.81% to 25.95.
Zee Media Company was trading 11.76% lower at 19.50 compared to the previous close of 22.10.
The promoter of the Essel Group had a detailed meeting with the lend entities comprising mutual funds, non-banking financial companies (NBFCs) and banks, in which it was determined that there would not be any event of "default affirmed due to the steep fall in price", the Essel Group said in a statement. The development comes two days after shares of ZEE Group companies had come under enormous selling pressure, plunging up to 33 percent, and suffered a shared erosion of Rs 13,352 crore in market valuation on January 25.
The BSE on Friday required amplification from Dish TV India with reference to news that a link has emerged between Essel Group and a company being probed for suspect demonetization deposits.
Later in clarification, the company said, "In this regard, we – Dish TV India Ltd, would like to state that there is no information by the company, which in our estimation needs to be reported to the stock exchange and which may have manner on the stock price of the company. Further, we would also state that the company is not aware of the supposed transactions mention in the said news report."
According to the Essel Group, its lenders have "showcased their belief" in the group firms ZEE Entertainment Enterprises and Dish TV.
"As a result of the above, there will be synergy and co-operation, amongst lenders leading to a unified approach. Lenders drew comfort from reiteration by the promoters for a speedy resolution through a strategic sale in a time-bound manner," the statement said.
Aditya Birla Sun Life AMC CEO a Balasubramanian said, "We have always whispered in the intrinsic value of ZEE Entertainment and most above, the sheer value system with which its promoters function. I am very glad about the outcome of the meeting, which enables us to arrive at a compromise, in the interest of all stakeholders."
On January 25 (Friday), Chandra had apologized to lenders and said his company was in a financial mess and answerable the same for the aggressive bets on infra, which had gone out of control since the IL&FS crisis and also the attainment of Videocon's D2H business.
Chandra also alleged that some negative forces are out to damage his efforts to raise money through a strategic sale in the flagship company Zee Entertainment Enterprises.
