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Thursday, June 01, 2006

Ashtavinayak Cine Vision plans Rs 50cr IPO

Mumbai-based Shree Ashtavinayak Cine Vision has plans to enter the capital market through an initial public offer, IPO, of Rs 50 crore (Rs 500 million) to upgrade its film production facilities and to finance three films reports Business Standard.

"We plan to raise Rs 50 crore from the markets for purchasing state-of-the art film production equipment and also finance three films, out of which one has hit the floor and the other two are in the pre-production stage," said Shree Ashtavinayak chairman and managing director Dhilin Mehta.

The company has made a net profit of Rs 9.26 crore (Rs 92.6 million) for the nine months ended December 31, 2005, with a turnover of Rs 46.92 crore (Rs 469.2 million), he added.

Ashtavinayak plans to produce an average of five films in one year and would also take on the distribution of another 11-12 films annually. Currently, the production house is ready with its multi-starrer Golmaal and Bhagam-bhag, which would be released in June 2006, said Mehta.

The company has also entered into agreements with 18 single-screen exhibitors in Mumbai, Goa, Gujarat, northern Karnataka to provide them with content and also consultancy for marketing activities.

The company's strategy would be to produce two to three films with a budget of Rs 15-17 crore (Rs 150-170 million) and thus reduce the risk involved.

They are also looking at overseas territory satellite rights, music rights, in film advertising and DTH as other revenue options.

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