The brokerage has upgraded the stock to ‘buy’ from ‘underperform’ and raised target price to Rs 250 from Rs 138 on favourable risk-reward.

Bank of America Securities said Zee’s OTT app Zee5 is well placed to improve its traction leading to revenue improvement & loss reduction. The brokerage believes that revenues/EBITDA of Zee have bottomed out in the first quarter and from these levels, momentum should improve. The brokerage also said Zee’s multiples had been depressed in the last 12-15 months on promoter group and balance sheet concerns.

“With the recent change of board members, improvement in disclosures (like balance sheet on a quarterly basis, Zee5 nos etc), coupled with reducing receivables/inventory should help to reduce these concerns,” said the brokerage.

It has also increased FY22-FY23 EPS on Zee by 12-16% to factor in better-than-expected advertising and margin recovery.