Sun TV IPO utilised by 2,496.98%
Televisionpoint.com Correspondent
The IPO of Sun TV, which closed today has been oversubscribed by 2,496.98% for a BSE quantity of 172017080. Qualified Institutional Buyers have oversubscribed the issue for 24.21 times, non institutional and retail individual investors have subscribe on a small gap phase. 5.23 per cent quota of non institutional investors have subscribed to the issue and 10.21 per cent was from retail investors. The bidding of the IPO was continued till 09:01 PM tonight and the Beckoning file from the SEBI was floated at around 11:00 PM. On the final day, the initial public offering has received an over whelping response with 50 per cent of the issue being subscribe today.
Sun TV Limited is not only the largest television broadcaster in Tamil Nadu and Kerala but also in the whole of India in terms of audience share. The bouquet of TV channels on offer includes Sun TV, KTV, Sun Music and Surya TV. Through an affiliated company the group also own Gemini TV and Udaya TV which may be consolidated over a period of time under one company. The company also operates leading Tamil radio under the name 'Suryan FM' and has been recently awarded with additional radio licenses's.
The funds raised through the public issue of Sun TV will be utilized towards the expansion in the FM radio business, wherein it has been allotted additional licence's to operate in 41 cities in Phase 2. Further, the funds will be utilized in launching of three new regional television channels.
The IPO from Sun TV hit the market on April 3, and the issue closed today, April 7. The price band was been fixed at Rs 730 to Rs 875. Sun TV has offered 68.89 lakhs fresh equity shares through the 100% book-building route. On the financial's front, In FY04-05, the total income of Sun TV increased by 12 per cent on a year-on-year basis to Rs 301 crore. The net profit during the same time period stood at Rs 76.8 crore. In the first nine months of the current fiscal the company has reported revenues of Rs 252.7 crore and a net profit of Rs 101.3 crore.
With a mere 10% being diluted through the IPO, it creates an enterprise value of Rs 6,000 crore. Sun TV's CMD Kalanithi Maran will continue to retain 90% of the equity stake in the company, post IPO. While 60% of the shares on offer has been reserved for QIB's, 10% has been earmarked for non-institutional investors. The remaining 30% is for retail investors, as earlier reported by Televisionpoint.com.
Launched on April 14, 1994, Sun TV controls almost 75% of the audience share in Tamil Nadu, which accounts for a television advertisement spend of Rs 350-400 crore. While Sun TV accounts for the top 100 slots among all channels in Tamil, it also accounts for over 30 slots out of the top 100, among all channels across India. Sun TV was the first Indian regional channel and Sun News the first 24-hour news channel in any language.
While Sun was also the first regional channel to go international, it is now available across the world — from Auckland to Los Angeles and from London to Cape Town. It has built a huge film library of 5,000 films and buys almost 90% of the new Tamil films that are released every year. While the Malayalam television market is comparatively smaller, with an ad spend of about Rs 100 crore, Surya and Kiran, occupy two of the top three slots.
The Indian advertising industry is currently on a growth trajectory. In fiscal 2005, the gross advertising spend in India was estimated at Rs 111 billion, which is further expected to grow at 14.2 per cent per annum to reach Rs 127 billion by fiscal 2007. For the same fiscal, the Indian radio industry revenues stood at Rs 3.22 billion. This is expected to grow by 14.3 per cent per annum to Rs 3.68 billion by fiscal 2006. Revenue for television industry is expected to to grow at a CAGR of 18 per cent till 2009. Also note on the valuations part, as the television and radio industry in India is growing at a fast pace and the implementation of CAS (Conditional Access System) will add to its growth.
Meanwhile, according to sources, the promoters of Sun TV, led by Kalanithi Maran, who owns a substantial stake in the company, will be divesting a minority stake of less than 20% through the IPO, though when contacted, neither Mr Maran nor any officials in the company confirmed the move.
The IPO of Sun TV, which closed today has been oversubscribed by 2,496.98% for a BSE quantity of 172017080. Qualified Institutional Buyers have oversubscribed the issue for 24.21 times, non institutional and retail individual investors have subscribe on a small gap phase. 5.23 per cent quota of non institutional investors have subscribed to the issue and 10.21 per cent was from retail investors. The bidding of the IPO was continued till 09:01 PM tonight and the Beckoning file from the SEBI was floated at around 11:00 PM. On the final day, the initial public offering has received an over whelping response with 50 per cent of the issue being subscribe today.
Sun TV Limited is not only the largest television broadcaster in Tamil Nadu and Kerala but also in the whole of India in terms of audience share. The bouquet of TV channels on offer includes Sun TV, KTV, Sun Music and Surya TV. Through an affiliated company the group also own Gemini TV and Udaya TV which may be consolidated over a period of time under one company. The company also operates leading Tamil radio under the name 'Suryan FM' and has been recently awarded with additional radio licenses's.
The funds raised through the public issue of Sun TV will be utilized towards the expansion in the FM radio business, wherein it has been allotted additional licence's to operate in 41 cities in Phase 2. Further, the funds will be utilized in launching of three new regional television channels.
The IPO from Sun TV hit the market on April 3, and the issue closed today, April 7. The price band was been fixed at Rs 730 to Rs 875. Sun TV has offered 68.89 lakhs fresh equity shares through the 100% book-building route. On the financial's front, In FY04-05, the total income of Sun TV increased by 12 per cent on a year-on-year basis to Rs 301 crore. The net profit during the same time period stood at Rs 76.8 crore. In the first nine months of the current fiscal the company has reported revenues of Rs 252.7 crore and a net profit of Rs 101.3 crore.
With a mere 10% being diluted through the IPO, it creates an enterprise value of Rs 6,000 crore. Sun TV's CMD Kalanithi Maran will continue to retain 90% of the equity stake in the company, post IPO. While 60% of the shares on offer has been reserved for QIB's, 10% has been earmarked for non-institutional investors. The remaining 30% is for retail investors, as earlier reported by Televisionpoint.com.
Launched on April 14, 1994, Sun TV controls almost 75% of the audience share in Tamil Nadu, which accounts for a television advertisement spend of Rs 350-400 crore. While Sun TV accounts for the top 100 slots among all channels in Tamil, it also accounts for over 30 slots out of the top 100, among all channels across India. Sun TV was the first Indian regional channel and Sun News the first 24-hour news channel in any language.
While Sun was also the first regional channel to go international, it is now available across the world — from Auckland to Los Angeles and from London to Cape Town. It has built a huge film library of 5,000 films and buys almost 90% of the new Tamil films that are released every year. While the Malayalam television market is comparatively smaller, with an ad spend of about Rs 100 crore, Surya and Kiran, occupy two of the top three slots.
The Indian advertising industry is currently on a growth trajectory. In fiscal 2005, the gross advertising spend in India was estimated at Rs 111 billion, which is further expected to grow at 14.2 per cent per annum to reach Rs 127 billion by fiscal 2007. For the same fiscal, the Indian radio industry revenues stood at Rs 3.22 billion. This is expected to grow by 14.3 per cent per annum to Rs 3.68 billion by fiscal 2006. Revenue for television industry is expected to to grow at a CAGR of 18 per cent till 2009. Also note on the valuations part, as the television and radio industry in India is growing at a fast pace and the implementation of CAS (Conditional Access System) will add to its growth.
Meanwhile, according to sources, the promoters of Sun TV, led by Kalanithi Maran, who owns a substantial stake in the company, will be divesting a minority stake of less than 20% through the IPO, though when contacted, neither Mr Maran nor any officials in the company confirmed the move.
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