Carnage-hit media shares plummet to 40% by 2025, but Ranbir Kapoor-backed scrip flashes Animal spirits

With 2025 coming to an end in a week, the media sector is poised to end the year as one of the worst performing sectors. Nine out of 10 stocks in the Nifty Media index have seen double-digit declines of up to 40% so far, but Ranbir Kapoor-backed Prime Focus stands out as a clear outlier, with robust gains of around 60% over the same period.The Nifty Media index, a sector benchmark, is down nearly 20%, while Network18 Media & Investments, the worst performer in the pack, is down 40%. Next in line are Tips Music and Saregama India, with share price erosion of 29% and 25% respectively.

Others like Zee Entertainment Enterprises, Hathway Cable & Datacom, PVR Inox, Sun TV Network, DB Corp and Nazara Technologies have lost between 24% and 10%.Media stocks outside the index, namely. NDTV and TV Today are also down 29% and 37% respectively.

Prime Focus, a stock with a market capitalization of Rs 17,329 crore, remains in top form despite uninspiring gains. The company’s consolidated net profit fell 89% to Rs 3.6 crore in the September quarter, compared to Rs 33 crore in the same period last year. Sales growth was 18% year-on-year in the July-September quarter.

Several reasons are attributed to the sector falling out of favor by 2025.

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Kranthi Bathini, director of equity strategy at WealthMills Securities, who has a ‘neutral’ view of the sector, sees the changing dynamics of media as the reason for the lackluster performance of media stocks. “Consumers are shifting towards web-based consumption and this is reflected in the proliferation of YouTube and OTT. Even on the television sets, which are now being replaced by smart TVs, the content consumed is shifting from traditional channel-based viewership to applications,” said Bathini.

He also notes a shift in investor preference towards innovation-driven companies, while pointing out that the space for big-bang innovations that can capture investor attention remains limited in traditional media companies.

Analyst Khushi Mistry labels the sharp underperformance of the media sector as structural and not cyclical stress. “Linear TV continues to lose market share to digital platforms, while ad spend remains fragmented and price-driven. High fixed costs, weak content revenues and pressure from global OTT players have squeezed margins. Stocks such as Network18 and PVR corrected sharply as earnings visibility deteriorated. The market is clearly pricing in a long transition phase with limited near-term catalysts and increasing execution risk,” she said.

Also read: Risk-off 2025 brings large caps back to the top after a two-year hiatus; what does 2026 hold?

A snapshot of profits

The profit environment has also deterred investors. Biggest loser Network-18 saw its revenues fall 73% year-on-year in Q2FY26, even as it swung to a profit of Rs 41 crore in the same period against the loss of Rs 96 crore in the same period a year ago.

In the news for the recently released blockbuster movie DhurandharPVR reported profit after tax (PAT) in the September quarter versus loss year-on-year, while revenue rose 12% from the corresponding period last fiscal. Yet the stock has failed to impress the street.

Saregama India and Zee Entertainment Enterprises reported a decline in their PAT and revenue in the second quarter.

Hathway Cable posted a consolidated PAT decline of 29% year-over-year in the second quarter, while revenue rose 5%. Sun TV’s revenue grew 39% in the second quarter, while profits fell 13%.

Meanwhile, Tips Music and DB Corp each reported double-digit PAT revenue growth in Q2FY26.

Outlook for 2026

Mistry said 2026 could mark a stabilization rather than a sharp recovery. According to her, advertising expenditure can remain selective

and event-based, while consolidation and cost rationalization can improve survivability.

“Any sustainable revaluation will depend on successful digital monetization, cinema pricing power and balance sheet discipline. The sector may see stock-specific opportunities, but a broad-based recovery seems unlikely without a clear improvement in ROCE and free cash flow generation,” the Bonanza Research Analyst said.

Bathini expects the pressure on media stocks to continue in the medium term.

(Data entry by Ritesh Presswala)

(Disclaimer: The recommendations, suggestions, views and opinions expressed by the experts are their own. These do not represent the views of The Economic Times.)