Sebi is expected to inquire senior management of Zee, including CMD Punit Goenka and founder Subhash Chandra, in an effort to disprove reports that the media company diverted funds.

A number of current and former board members will also be investigated as part of the investigation, which is anticipated to go on until April. A report in the Economic Times stated that the regulator may potentially take legal action in light of its conclusions.

Zee disputed the regulator's June investigation's finding of diversion of Rs 200 crore through related party transactions before the Securities Appellate Tribunal. Sebi then began a more extensive investigation of the company's financial activities.

ZEE's stock fell 14.8% on the BSE on Wednesday, closing at Rs 164.50 a share, following a Bloomberg article claiming that Sebi had discovered that the company's proprietors may have misappropriated over $241 million (Rs 2,000 crore). The sharp drop in the price of ZEE shares has been exacerbated by this, after the cancellation of a $10 billion merger agreement involving the Sony Group's Indian subsidiary.

Since mid-2023, Sony and Zee have been embroiled in a lot of back-and-forth over the regulatory investigation into the father-and-son team's alleged financial irregularities. Goenka refused to back down since the CEO position was guaranteed to him in the 2021 merger agreement, which made Sony leery of allowing him lead the combined company. In the end, the impasse resulted in Sony abandoning the agreement in January.

Zee's spokeswoman, however, shot off the story, calling it "false and inaccurate reports and rumors regarding accounting issues within the company." The firm has been giving any comments, information, or explanations sought by Sebi in accordance with the SAT ruling, which provided relief to the existing key management people (KMP), and it has extended full cooperation on all fronts."