Zee Entertainment shares crash over 10% amid SEBI action
What's the story
Zee Entertainment Enterprises Ltd. (ZEEL) witnessed a massive drop in its share price on Monday. The company's stock plummeted by over 10% in early trading, marking its biggest single-day fall since June 2024. At the time of writing, the stock was trading at ₹102.9, down by 10.17%. The decline comes after a series of developments concerning the company and its promoters, Punit Goenka and Subhash Chandra.
Regulatory action
SEBI bars Zee from accessing securities market for 2 months
The Securities and Exchange Board of India(SEBI) has barred Zee Entertainment from accessing the securities market for two months.
Promoters Punit Goenka and Subhash Chandra have been barred for a period of 12 months each.
The action relates to Zee's Hyderabad property being used as collateral for ₹726 crore loans to four Essel Group entities without board and audit committee approvals.
Warrant issue
SEBI's order also affects Zee's ₹3,143 crore warrant issue plan
SEBI's order also affects Zee's plan to issue 24.95 crore warrants to its promoters for ₹3,143.5 crore.
The resolution was approved by shareholders with 76.6% of the total votes polled in favor.
Zee cannot issue fresh warrants right now because SEBI's market ban is active. Even if Zee appeals SEBI's decision at the Securities Appellate Tribunal (SAT), they cannot assume SAT will grant a stay on the ban.
Until SAT formally halts SEBI's order, the warrant issue remains legally blocked.