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Shemaroo Entertainment Gains 6% on Debut; Lists at Rs 180

Shemaroo IPO was oversubscribed 7.39 times. Its retail segment was subscribed 7.7 times, non-institutional investor segment was subscribed 8.6 times and the qualified institutional buyer (QIB) segment was subscribed 5.6 times.
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Shemaroo Entertainment Gains 6% on Debut; Lists at Rs 180

Shares in Shemaroo Entertainment- an integrated media content company listed at Rs 180 per share, 6 per cent premium over issue price of Rs 170 on NSE.

Shemaroo IPO was oversubscribed 7.39 times. Its retail segment was subscribed 7.7 times, non-institutional investor segment was subscribed 8.6 times and the qualified institutional buyer (QIB) segment was subscribed 5.6 times.

Its shares were issued at a price of Rs 170 per share. However for retail investors the shares were issued at 10 per cent discount at Rs 153 per share. The issue size was Rs 120 crore. Through this issue promoters have reduced their stake in the company from 92 per cent to 70 per cent.

Jai Maroo, director at Shemaroo Entertainment told NDTV that future opportunities are massive for the company. "In the next few years there is substantial upside expected in the growth and consumption of video on various digital medium fuelled by the fact that broadband infrastructure will kick in from 3G and 4G to optical fiber network," said Mr Maroo.

The company is looking to enhance its presence in digital space and increase their content library by utilising the money raised through the IPO, added Mr Maroo.

Objective of the issue

The company has raised Rs 120 crore through this issue. Out of the Rs 120 crore, the company wants to use Rs 106 crore for working capital requirement as the business is highly working capital intensive. Out of the Rs 106 crore, Rs 80 crore will be used in FY15 and Rs 26 crore will be used in FY16.

Company Profile

Shemaroo is a Mumbai-based integrated media content house, founded in 1962. Its activities include content acquisition, value addition to content and content distribution. Shemaroo's content library spans over 2,900 titles of which 700 plus titles have perpetual rights.

Shemaroo's gets 50 per cent of its revenue through broadcast syndication. The company has maintained strong revenue growth profitability in last four years.

Valuation

Shemaroo had reported earnings per share (EPS) of Rs 14.1 for FY14 and Rs 12.4 for FY13. At listing piece of Rs 180 the share trades at 12.76 times its FY14 EPS whereas its peer Eros International Media trades at 11 times its FY14 EPS.

As of 10.35 a.m. shares in Shemaroo Entertainment traded 0.6 per cent higher at Rs 171 apiece outperforming the Nifty which was down 0.21 per cent



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