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Shemaroo’s Rs 120 crore IPO subscribed 28% on first day

Shemaroo LogoBollywood content aggregation company Shemaroo’s Rs 120 crore IPO saw significant participation from retail investors, with the retail allocation subscribed 53%. However, no participation from Qualified Institutional buyers and limited participation from Non Institutional Investors, meant that the company closed the first day with 28% of the offer subscribed. 

Bids were evenly spread across the Rs 155-Rs 170 price band, with a maximum of 1.43 million bids at the Rs 155 level, and the lowest at cut-off at 1.2 million. For most price points, bids were around the 1.4 million mark. IPO’s bids typically peak on the last day.

The company had sold 2,117,605 shares at Rs 170 with anchor investors for Rs 36 crores on September 15th, before the IPO opened. Investors mostly included funds from HDFC and Birla Sun Life, with HDFC picking up around 55%, and Birla Sun Life picking up the remaining 45% of that issue.

shemaroo-ipo-day1

Shemaroo’s consolidated total income was at Rs 265.95 crore in FY14, up 23.1% year-on-year (YoY). The profit after tax was at Rs 27.27 crore in FY14, up 16.3% YoY while EBITDA was at Rs 65.69 crore, up 11.9% YoY. The consolidated net worth of Shemaroo as of March 31, 2014 is Rs 174.45 crore. Its group company, Think Walnut, posted total sales of Rs 1.82 crore for FY14, up from Rs 0.65 crore in FY13. The net loss was at Rs 0.19 crore for the fiscal, as compared to Rs 1.3 crore loss in FY13.

Notes from the IPO filing:

– Content Library: Shemaroo’s content library consists of more than 2,900 titles. This includes 759 titlesover which it has complete ownership rights (of which 355 are Hindi films, 364 are regional films and 40 are “special interest content” like devotional and kids content) and 2,159 titles over which it has Aggregation Rights, of which 1289 are Hindi films, 728 are regional films and 142 are special interest titles.

– New Media Tie-ups: Shemaroo notes that it has tied up with more than 100 labels or content providers to offer content on new media platforms (mobile, Internet, DTH and other apps). This includes music, videos, imagery content, games, applications, celebrity chats, text content, and voice based services among others.

– Online video: Shemaroo has tied up as an official channel partner on YouTube and is currentlymanaging 32 channels on the service. This includes Shemaroo Movies, Shemaroo Entertainment and Filmi Gaane among others. Besides this, it has agreements with video on demand services like Daily Motion, Yahoo India and Spuul among others.

– Owns 50% stake in Vistaas Digital: Shemaroo had acquired 50% stake in the devotional content provider Vistaas Digital Media Private Limited for Rs 10.61 crore in October 2010. This was to secure devotional content for its new media initiatives.

– Content Management partnerships: Shemaroo mentions that it is moving beyond just content aggregation to provide content management solutions to various partners. This includes powering the Re 1 WAP store for Reliance Communications and offering interactive devotional service iDarshan for Airtel Digital TV. Note that Shemaroo had also partnered with MTS India to offer its devotional service ‘iDivine‘ as a value added service for MTS MBlaze subscribers in September last year.

More from the IPO filing, including shareholding structure details, here.

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