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3 November 2023

Inspire Films IPO: Lights, Camera, Investment Opportunity

Introduction:

The Inspire Films IPO has brought a unique opportunity to invest in the world of content creation, production, distribution, and exhibition. This book-built issue is valued at Rs 21.23 crores and comprises an entirely fresh issue of 35.98 lakh shares. The IPO bidding window opened on September 25, 2023, and concluded on September 27, 2023. The allotment results were disclosed on October 3, 2023, and the shares started trading on NSE SME on October 5, 2023. The price band for the Inspire Films IPO was set at ₹56 to ₹59 per share, with a minimum lot size of 2000 shares, requiring a minimum investment of ₹118,000 for retail investors.

Key Players:

Narnolia Financial Services Ltd was entrusted with the role of the book running lead manager for the Inspire Films IPO, while Maashitla Securities Private Limited acted as the registrar for the issue. Share India Securities served as the market maker.

Stock Performance:

As of October 19, 2023, Inspire Films Limited's stock was trading at ₹68.50, with a 0.22% decrease. The stock opened at ₹69.75, reaching a daily high of ₹71.80 and a low of ₹66.50, following a previous closing price of ₹68.65. The total traded value for the day was 62,000 shares.

Ownership Structure:

Before the issue, the company's shareholding pattern stood at 10,011,299 shares. Post-issue, it adjusted to 13,609,299 shares.

Financial Snapshot:

Inspire Films Limited demonstrated a strong financial performance. As of March 31, 2023, the company's assets totaled ₹4,159.88 lakhs. The company reported robust revenue figures, with total earnings of ₹4,884.82 lakhs in fiscal 2023. The company's profit after tax reached ₹404.82 lakhs. The net worth of the company was reported at ₹1,311.22 lakhs, with reserves and surplus amounting to ₹1,310.16 lakhs. Total borrowings stood at ₹836.85 lakhs.

Key Metrics:

The IPO presented a Price-to-Earnings (P/E) ratio of 19.87, a Market Capitalization of ₹80.3 crores, Return on Equity (ROE) of 30.88%, Return on Capital Employed (ROCE) of 32.01%, Debt-to-Equity ratio of 0.64, Earnings per Share (EPS) of ₹3925, and Return on Net Worth (RoNW) of 30.88%.

IPO's Purpose:

The net proceeds from the issue were allocated for the following objectives:

1. Meeting the Working Capital requirements of the Company.
2. General Corporate Purposes.
3. Covering the Issue Expenses.

Expert Opinion:

Inspire Films Limited specializes in providing digital content and related services for television and film-making. The company reported boosted profits for FY23, although it operates in a highly competitive and fragmented segment. Informed, cash-rich, and risk-seeking investors may find this a compelling opportunity, while others may consider it a "High Risk/Low Return" bet.

Subscription Status:

The Inspire Films IPO saw a remarkable level of interest from investors, achieving an overall subscription rate of 129.08 times as of September 27, 2023. Retail investors displayed significant enthusiasm, with a subscription rate of 180.41 times.

Conclusion:

Inspire Films IPO opens the door to the dynamic world of content creation and distribution. As with any investment, conducting thorough research and prudent risk management are crucial. This IPO offers an intriguing investment opportunity in the entertainment and digital content sector.

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