Wednesday, July 21, 2010

Hindustan Media Ventures IPO

Analysis
Hindustan Media Ventures (HMV) has come out with an IPO of Rs. 270 crore. The company is one of the leading print media companies in India in terms of Readership. Hindustan is presently printed at 16 locations in the states/regions of Uttar Pradesh, Bihar, Jharkhand, Uttarakhand, Punjab and Delhi NCR with a total installed rated capacity approximately 0.78 million copies per hour.

The issue will open for subscription on July 5 and will close on July 7. HT Media holds 98.85% stake in HMV. The company has fixed a price band of Rs 162-175 a share for its IPO.

The objective of the issue are to raise funds for setting up new publishing units; upgrading existing plant and machinery; prepayment of loans, and for general corporate purposes.

The book running lead managers to the issue are Edelweiss Capital Ltd and Kotak Mahindra Capital Co Ltd. Karvy Computershare Pvt Ltd is the registrar.

Recommendation
Though the company has roped in some angel investors, we would not recommend investors to invest in this IPO for now considering the global markets. Though Indian Stock markets have not got impacted from the global scenario till now but, by the time the issue gets listed, Indian stock markets may also get impacted and the IPO may take a beating. The issue is also not cheap for investors to take the risk for now.

Subscription
Subscription for HMV has started on a low note but picked up well and got subscribed 5.43 times. The price has been fixed at Rs. 166 per share. At the close of the IPO,
QII segment got subscribed by 8.98 times
NII segment got subscribed by 3.39 times
Retail segment got subscribed by 1 time

Allotment
Click here to check if you have been alloted HMV shares!

Listing
HMV had a good listing. It was opened at Rs 177.95 on NSE and closed at Rs 191.50, up 15.36% over its issue price of Rs 166, after hitting an intraday high of Rs 191.85 & low of Rs 174.15 on NSE. On the BSE, the stock ended at Rs 189.20, after seeing a high of Rs 191.90 and low of Rs 170.


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