Ganesh Films IPO Opens Today, Should You Invest?

Ganesh Films IPO opened today to raise 8.42 crore through the issue of 1,052,800 shares. The lead manager to Ganesh Films IPO is Fedex Securities Limited and the Registrar to this issue is Bigshare Services Pvt. Ltd.

Ganesh Films India Limited’s objective is to bridge the gap between South Indian film Industry and south Indian movie fans in northern and western regions of India. This is commonly known in the film industry as the North Indian territory (“Distribution Territory”). The operation of the Ganesh Films India is divided in two parts

(a) Sourcing of content and

(b) Distribution of the content.

Investment Rationale

• Currently, Ganesh Films has a portfolio of over 696 south Indian films in which the company has sole, irrevocable and non-exclusive distribution right to use the contents / titles for a perpetual term for all the territories in the world including India.
• The promoters have extensive experience in the theatrical distribution of approx. 450 south Indian films (including Tamil, Telugu, Kannada, Malayalam and other regional films) in the Distribution Territory.
• Some of the popular blockbuster films distributed by Ganesh Films include Sivaji, Dasavathaaram, Endhiran, Thevar Magan, Oomai Vizhigal, Captain Prabhakaran, Thaana Serndha Kootam, Roja, among others.
• The company also undertakes other activities like pre-release marketing, negotiate with exhibitors for terms and collection of money on behalf of the producer.
• They are ensuring a sustainable competitive advantage and enhancing monetization of the GFIL Library through new and emerging media platforms.

Purpose of the issue

1. Acquisition of distribution rights of south Indian films (including Tamil, Telugu, Malayalam and other regional language films) for the territories of India- Rs. 595.00 lakhs
2. General corporate purposes- Rs. 193.74 lakhs
3. The listing of Equity Shares is expected to enhance the company’s brand name and provide liquidity to the existing shareholders.

Ganesh Films IPO Details

• Issue Open: July 16, 2018 – July 18, 2018
• Issue Type: Book Built Issue IPO
• Issue Size: 1,052,800 Equity Shares of Rs 10 aggregating up to Rs 8.42 Cr
• Issue Price: Rs 80 Per Equity Share
• Market Lot: 1600 Shares
• Minimum Order Quantity: 1600 Shares
• Listing At: BSE SME

Valuation – Should you invest?

Ganesh Films has no listed peers in India engaged in this particular business segment. for the period ending May 8, 2018 to May 20, 2018, the company has reported the total revenue of Rs. 9.18 Lakhs and profit/loss after tax for this period is Rs. 0.53 Lakhs. The company’s business is expected to perform well in the future. However, the investors should be “neutral” to Ganesh Films IPO and should wait for its listing to make an investment decision.