Amidst all the pending legalities creating uncertainties, the question that every investor wants an answer to is whether the Zee-Sony merger will go through and what lies ahead for the stock.

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In latest developments, SEBI issues interim order alleging fund siphoning by Zee promoters. Alongside, the SEBI bars Subhash Chandra and Punit Goenka from holding board or key managerial positions in any listed company. It is noteworthy that Goenka was earlier decided as the MD and CEO of merged entity. The company has challenged SEBI’s order at the Securities Appellate Tribunal (SAT) and the case hearing is on June 26.

Giving some respite to investors, the shares of Zee Entertainment rose over 8 percent on June 21 morning in reaction to reports that Sony had no plans to back out of the merger despite allegations of funds diversion made against its promoters Subhash Chandra and Punit Goenka by India’s markets regulator.

Sony, in response gave a statement “There have been several erroneous press reports recently speculating about the future of ZEE’s planned merger with SPNI following SEBI’s interim order against Subhash Chandra and Punit Goenka. We take very seriously the SEBI interim order and will continue to monitor developments that may affect the deal.”

Punit Goenka responded saying the merger holds utmost importance and will go through whether or not he holds the CEO position of the merged entity. He adds that the merger will benefit 96 percent of the shareholders and therefore is in larger interest of the ecosystem.

Karan Taurani, Analyst at Elara Capital expects the merger to take place even without Goenka holding the top boss position. "In case Goenka does not get relief at SAT, the merger goes through without him with a Sony representative as CEO." Elara Capital maintains positive stance on Zee and expects big rerating on valuation multiples.

Taurani while interacting with CNBC-TV18 says incremental uncertainties developed in June which is increasing the time for the merger to go through.

Shares of Zee are down 81 percent since announcing the deal with Sony in December 2021. New investors contemplate whether investing in the stock at current levels is advisable. Taurani recommends a buy with a an upside potential of 70 percent with the merger being the biggest trigger. He expects Zee's profits to be restricted to Rs 1,000 crore, while the merged entity can deliver profits of Rs 2,400 crore. Hence it is crucial for the merger to go through.

In the fourth quarter, the margins collapsed, advertising revenues bottomed and the company reported Rs 73 cr net loss. So troubles aplenty for the broadcaster. The stock closed the trading session on June 22 with a fall of 0.5 percent.