Picture Post Studios IPO Lists at ₹30, 25% Above Issue Price

Picture Post Studios Ltd. made a positive market debut on Friday, August 9, when it listed at ₹30 per share, 25% more than its issue price of ₹24. Driven by its specialist services in visual effects (VFX), computer-generated imagery (CGI), and post-production for films and digital platforms, the company's robust opening demonstrates favourable confidence among investors.

Analysts have cited the company's strong financial performance as contributing to the IPO's success. During Picture Post Studios' fiscal year, which ended in March 2024, the company's sales increased by 144.6%, and its profit after tax (PAT) increased by 472.89%. These outstanding numbers have increased optimism about the company's prospects going forward.

The IPO was well-received, with an overall subscription rate of 266.60 times. Retail investors subscribed 308.09 times, Non-Institutional Investors (NIIs) 389.67 times, and Qualified Institutional Buyers (QIBs) 101.19 times. This overwhelming response, particularly from institutional investors, demonstrates the market's enormous trust in the company's business plan and development prospects.

The offering had no offer-for-sale (OFS) component and was made up only of freshly issued equity shares. The company intends to use the ₹18.72 crores from the IPO for general corporate purposes, working capital requirements, and business expansion.

According to analysts, the company is a desirable long-term investment due to its strong financial growth and emphasis on providing specialised services to the entertainment industry. However, analysts also warn that the high subscription rates and ensuing price spike could cause short-term volatility, and they recommend investors think about the long-term potential of the stock before making any decisions.

Established in 2019, Picture Post Studios Ltd. is a specialised provider of visual effects (VFX) and post-production services that has made a name for itself in the entertainment sector. The company provides various services for movies, ads, and digital platforms, such as CGI, colour grading, mastering, and quality checks. With an emphasis on producing innovative visual experiences, Picture Post Studios has become a go-to collaborator on numerous well-known projects.

Using its cutting-edge technical capabilities, the company currently manages numerous projects, including work on popular movies, web series, and advertisements. Picture Post Studios has experienced impressive financial growth in the last few fiscal years. Compared to the previous year's ₹5.99 crore, the company's profit after tax (PAT) increased significantly in the fiscal year 2024, rising by 472.89% to ₹34.35 crore. The company's income increased by 144.6% to ₹265.47 crore in the same period, indicating a growing demand for its services.

The company's EBITDA margin also increased, reaching 13.29% in FY 2024, indicating excellent operational performance. Profits before interest, taxes, depreciation, and amortisation, or EBITDA, climbed significantly due to more projects being completed and more efficient service delivery.

To Summarise

Picture Post Studios IPO made an excellent market debut on Friday, August 9, 2024, when it listed on NSE SME at ₹30, 25% more than the ₹24 issue price. The IPO attracted much interest, as seen by the 266.60x total subscription rate, primarily driven by individual investors at 308.09x and non-institutional investors (NIIs) at 389.67x. The offering included various recently issued equity shares, which raised ₹18.72 crore. The money would be used for corporate purposes, working capital needs, and business expansion.