Music Broadcast Ltd. (MBL), an ancillary of Jagran Prakashan Ltd. (JPL), has filed its draft red herring prospectus (RHP) with the Securities Exchange Board of India (SEBI) for an initial public offering (IPO). The IPO will contain a fresh issue of shares worth Rs 400 crore and offer for sale of 26 lakh shares. MBL accommodates the radio business arm, Radio City, of JPL.
On the news, Jagran Prakashan share price surged 20% on the NSE today to trade at Rs, 210.40, which is also its intraday high in the first half of the trade.
The company has chosen ICICI Securities as its book running lead manager and Karvy Computershare as registrar to the offer. Radio City is the oldest private FM radio broadcaster in India and has been in the industry for 15 years now. At present, it operates in 29 cities and has sales partnership in another two. Its broadcast licenses were renewed for another 15 years, starting April 1, 2015
Jagran Prakashan share price have gained for three straight sessions, after news of its latest IPO offering hit the markets.
Twenty three out of its 25 current promoters are looking to offload their stake completely, through this offer for sale. The primary shareholder, Jagran Prakashan, which owns 89.4% stake in the company and its director Satish Chandra Mishra will not be striping their stake through this offer for sale though. The other shareholders collectively own around 6%. At 11:20 Am, Jagaran Prakashan share price was trading at Rs. 180, up by almost 3%.
JPL had acquired MBL on June, 2015 at an average expenditure of Rs 46.63 per equity share.
The radio broadcaster has no plans of growing its business, with a large chunk of the fresh issue already allocated to clean up its books. 50% of the amount raised will be used to cash in MBL’s debentures, including some issued to the existing promoters. The remaining amount has been set aside for general corporate purposes.
The radio broadcaster has no plans of growing its business, with a large chunk of the fresh issue already allocated to clean up its books. 50% of the amount raised will be used to cash in MBL’s debentures, including some issued to the existing promoters. The remaining amount has been set aside for general corporate purposes.
MBL’s revenue increased at a compounded annual growth rate (CAGR) of 18% from financial year 2012 to 2016. For the financial year 2016, company had posted total revenue of Rs 245.5 crore and net profit of Rs 42.5 crore. The net profit was successively lower by 10% on account of an exceptional loss of Rs 13.6 crore.
Jagran Prakashan is the top 500 recommendation by Dynamic Levels for the quarter. For the details on the stock, visit Jagran Prakashan share price history page of Dynamic Levels website.
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