Shares of Zee Entertainment Enterprises rose more than 3% on May 27 after the company reported solid earnings for the quarter that ended in March. The broadcaster reported that operating income for the quarter rose 18.2% year-on-year to Rs 2,323 crore, higher than Rs 2,135 crore in a CNBC-TV18 survey, despite sluggish ad sales.

Advertising sales in the reported quarter were Rs 1,119.8 crore compared to Rs 1,123 crore a year ago, reflecting pressure on the advertising industry as FMCG and startups scaled back promotions to cut costs.

However, the company’s top-line solid performance was not reflected at the operational level due to higher expenses, as earnings before interest, tax, depreciation and amortisation (EBITDA) fell 10% year-on-year to Rs 486.6 crore in the reported quarter, but it That beat Street’s estimate of Rs 479 crore.

Lower operating profit led to a 34% Y-o-Y drop in net profit to Rs 181.9 crore. Investors may have been impressed by the recovery momentum of Zee5, the over-trading business this quarter. Zee5‘s daily active users increased by 44.5% year-on-year to 10.5 million in the quarter, while global monthly active users reached 104.8 million, and user engagement showed an upward trend.

Shares of Zee Entertainment were up 3.1 per cent at Rs 236.90 on the National Stock Exchange (NSE) at 10.50 am.