Indian movie distribution arm of AIM-listed Eros International Plc made a successful debut at the local stock exchange listing at 22% premium to the issue price of Rs 175, which was the upper end of the price band of the public offer.
At mid-day trading hour, Eros International Media Ltd scrip was quoting at Rs 188, 7% more than the issue price valuing the firm at Rs 1,726 crore ($390 million). Its parent company last traded at a price that gave it a market cap of around $471 million.
The firm intends to use the Rs 350 crore raised through the public float to acquire and co-produce Indian films, including primarily Hindi language films as well as certain Tamil and other regional language films.
Although Eros could not match the spectacular listing of the Indian arm of another AIM-listed media firm wherein animation and game art company DQ Entertainment opened early this year with 69% listing gains, it did provide comfortable profits to people who subscribed to the issue for short term capital gain.
Eros acquires films from third-parties, through co-productions and occasionally, through own productions. After acquiring, Eros exploits the film content through multiple formats such as theatres, home entertainment (DVD, VCD), cable & satellite rights and new media formats. Eros has given box-office hits like Love Aaj Kal, Om Shanti Om, Partner and Cheeni Kum and has over 1,000 Indian films in its library.
It is part of Eros group that is led by Lulla business family founded by Arjan Lulla and now handled by his two sons Sunil and Kishore. While Sunil is vice chairman and managing director of Eros International Media Ltd, Kishore, who is a British national, handles the overseas businesses.
For the year ended March’10, it had total income of Rs 655 crore with net profit of Rs 82.3 crore and for quarter ended June 30, the firm had net profit of Rs 15.5 crore on total revenue of Rs 128 crore.
Enam Securities, Kotak Mahindra Capital, Morgan Stanley India and RBS Equities (India) were the lead book running managers of the issue.