Group company backing New Year festival (5)
I believe the answer is:
octet
'group' is the definition.
(group of eight musicians)
'company backing new year festival' is the wordplay.
'company' becomes 'co' (abbreviation).
'backing' is a reversal indicator.
'new year festival' becomes 'tet' (I've seen this in another clue).
'co' in reverse letter order is 'oc'.
'oc'+'tet'='OCTET'
(Other definitions for octet that I've seen before include "Group of eight, say singers" , "What takes members up to eighth" , "Set of eight" , "A group of eight instruments or voices" , "Group that plays" .)