Shemaroo Entertainment has filed its draft red herring prospectus (DRHP) with the market regulator SEBI for its maiden public offering, looking to raise Rs 115 crore.

According to a preferential allotment made in August, Shemaroo might be looking at a pre-money valuation of nearly Rs 197 crore and post-money valuation of Rs 312 crore. This would mean a dilution of around 35 per cent stake in the IPO. The promoter group currently holds 90 per cent stake in the company.

The funds raised from the IPO will be used for working capital requirements and other general corporate purposes. Yes Bank Ltd and ICICI Securities Ltd are the book running lead managers to the issue.

Shemaroo, set up in 1962 as a book circulating library, is an integrated media content firm with activities across content acquisition, value addition and content distribution. The company has a content library featuring more than 2,500 titles – spanning new and classic Hindi films, besides regional language movies.

The firm distributes its content through television, mobile, Internet and DTH (direct to home), among others. Recently, Shemaroo has tied up as an official channel partner for Google’s YouTube where it is managing 32 channels. It has also started providing content management solutions to organisations like Airtel, British Telecom and Tata DOCOMO.

Shemaroo reported 54.52 per cent increase in total income to Rs 160.23 crore in FY11 with EBITDA at Rs 35.37 crore and profit after tax at Rs 13.62 crore. Shemaroo is looking at 20x PAT multiple for the issue, the same level where other content firms like Eros International Media are trading. 

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