No skin in the game? UFO Moviez lists at a discount to offer price


UFO Moviez LogoShares of digital cinema distribution network UFO Moviez India Ltd made a weak listing on the bourses today. Shares listed at INR600 each, marking a discount of 4 per cent discount to the IPO price of INR625 per share. At the day’s high level, the shares traded at INR622.9 apiece, still less than the IPO price while the lowest level was at INR586 apiece. From the lowest levels, stock price recovered to close at INR597.3 per share on the NSE.

The company claims to be India’s largest in-cinema advertising platform. It operates a satellite-based, digital cinema distribution network that includes 4,911 screens across the country. Along with its subsidiaries and associates, its global network amounts to 6,626 screens with presence in Nepal, the Middle East, Israel, Mexico and the USA.

UFO Moviez tapped the primary market between 28 and 30 April with an IPO of 68.2 lakh shares. The book building issue, priced in the range of INR615 -625 per share, was subscription 2.04 times. However, retail category subscription was less at 1.02 times. In addition, the company raised about INR180 crore by selling 28.8 lakh shares to anchor investors at INR625 per share. Included among the anchor investors are Reliance Mutual Fund, State Bank of India Mutual Fund, Kotak Mahindra Mutual Fund, Pinebridge Global Funds, Jupiter South Asia, Amundi Funds, Ashmore SICAV and Bharti AXA Life Insurance.

UFO Moviez India Limited IPO Bidding (as on 30 April 2015)
Category No.of shares offered No. of shares bid for No. of times of total
Qualified Institutional Buyers (QIBs) 1951219 8761944 4.49
Non Institutional Investors 1463415 1705344 1.17
Retail Individual Investors (RIIs) 3414635 3494496 1.02
Total 6829269 13961784 2.04

Source: NSE

It is important to note that the company did not get any money from the issue as all shares offered in the IPO were sold by existing investors. UFO Moviez counts Sanjay Gaikwad, Narendra Hete and Apollo International among its promoters. All the three promoters and other investors including 3i Research, P5, Valuable Media Limited, and Valuable Technologies Limited participated in the offer.

It is not surprising to see that the shares have listed at a discount as a number of brokerage houses advised investors to give it a miss citing expensive valuations. Besides, the fact that the company did not participate in the issue and it was merely an offer for sale (OFS) from existing shareholders could have played a role in the poor listing.


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