Why Zee Entertainment stock rose 20% in early trade

Stock of Zee Entertainment zoomed 20 per cent in early trade today after shareholder Invesco Developing Markets Fund said that it would not pursue the EGM requisition dated September 11, 2021.

The investor also said it has decided to withdraw its requisition notice that sought the removal of MD and CEO Punit Goenka from the board of ZEE.

The announcement comes after the Bombay High Court on Tuesday allowed an appeal filed by Invesco against a single-judge order granting interim injunction on holding an EGM of Zee Entertainment.

Invesco also reiterated its support for the Zee-Sony Pictures Networks India merger as currently proposed. Zee Entertainment share rallied 20 per cent to Rs 307.25 against the previous close of Rs 256.05 on BSE. The large cap stock opened with a gain of 10 per cent at Rs 281.65 today.

ALSO READ: HC permits Invesco's appeal against injunction on EGM to remove Zee CEO Punit Goenka

Total 20.71 lakh shares of the firm changed hands amounting to a turnover of Rs 61.36 crore. Market cap of Zee Entertainment rose to Rs 28,186 crore. The stock hit a 52-week high of Rs 378.60 on December 15, 2021 and a 52-week low of Rs 166.80 on August 23, 2021 on BSE.

Zee Entertainment share is trading higher than 5 day, 20 day, 50 day and 200 day moving averages but lower than 100 day moving averages.

The share has gained 42.65 per cent in one year and fallen 8.8 per cent since the beginning of this year. In a month, the stock has gained 32 per cent.

"Since we announced our intention to requisition an EGM and add six independent directors to Zee's Board of Directors, Zee has entered into a merger agreement with Sony. We continue to believe this deal in its current form has great potential for Zee shareholders. We also recognise that, following the merger's consummation, the board of the newly combined company will be substantially reconstituted, which will achieve our objective of strengthening board oversight of the company. Given these developments, and our desire to facilitate the transaction, we have decided not to pursue the EGM as per our requisition dated 11 September 2021," the company said.

It added that Invesco will continue to monitor the progress of the proposed merger. If the merger is not completed as currently proposed, Invesco will retain the right to requisition a fresh EGM, it said.

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