As the media and entertainment sector continues to evolve and expand, one of the most anticipated IPOs hitting the stock market is that of Identical Brains Studios Limited. In an era where technology and entertainment are increasingly intertwined, Identical Brains Studios is set to make a significant mark on the stock market with its upcoming IPO. Known for its groundbreaking work in the immersive entertainment sector, Identical Brains Studios is at the forefront of the next generation of digital content creation.
As Identical Brains Studios prepares to go public, it brings forth a unique investment opportunity in a rapidly growing sector. The IPO is expected to attract investors looking to capitalize on the expanding intersection of technology and media, especially as consumer demand for innovative digital experiences continues to surge globally. As the company gears up for its market debut, it’s an exciting time for the entertainment industry, and investors eager to tap into this dynamic and evolving market should pay close attention to what Identical Brains Studios has to offer.
This article will explore the key details of the Identical Brains Studios IPO, its innovative business model, competitive advantages, and growth potential.
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Table of Contents
Identical Brains Studios IPO Details
Identical Brains Studios is a book-built issue of ₹19.95 crore and it’s entirely a fresh issue which means proceeds from the issue will go to the company to strengthen it.
The ₹19.95 crore IPO of Identical Brains Studios will open for subscription on Wednesday, December 18, 2024, and close on Friday, December 20, 2024. The allotment for the Identical Brains Studios IPO is expected to be finalized on Monday, December 23, 2024 and the company will be listed on NSE SME, with a tentative listing date on the stock exchanges set for Thursday, December 26, 2024. The price band for the Identical Brains Studios shares has been fixed between ₹51 to ₹54 per share.
| IPO Name | Identical Brains Studios Limited |
| IPO Open Date | 18 December 2024 |
| IPO Close Date | 20 December 2024 |
| Price Band | ₹51 to ₹54 per share |
| Lot Size | 2,000 shares |
| Face Value | ₹10 per share |
| Total-Issue Size | 36,94,000 shares (aggregating up to ₹19.95 Cr) |
| Fresh Issue | 36,94,000 shares (aggregating up to ₹19.95 Cr) |
| Share Allotment Date | 23 December 2024 |
| Initiation of Refund | 24 December 2024 |
| Demat Transfer | 24 December 2024 |
| Listing Date | 26 December 2024 |
| UPI Cut Off Time | 20 December 2024 – 5 P.M. |
| Listing Exchange Name | NSE SME |
| Share Holding Pre Issue | 1,03,31,958 shares |
| Share Holding Post Issue | 1,40,25,958 shares |
| Lead Manager(s) of Issue | Socradamus Capital Private Limited |
| Registrar of Issue | Bigshare Services Private Limited |
| Market Maker Portion | 1,86,000 shares Rikhav Securities Limited |
For detailed information, you can refer to Identical Brains Studios IPO RHP.
Identical Brains Studios IPO GMP
Ahead of the opening, the IPO has been getting a good response in the unlisted market where the issue is currently commanding a premium of about 70% in the grey market, with the latest GMP standing at ₹38 today with an estimated listing price of ₹92.
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Identical Brains Studios IPO Lot Size
The company has issued 36,94,000 shares worth ₹19.95 Cr for the fresh issue. The minimum lot size for an application is 1 lot (2000 shares). The minimum amount of investment required by retail investors is ₹1,08,000.
The minimum lot size for HNI (High Net Worth Individual) is 2 lots (4,000 shares), amounting to ₹2,16,000.
| Category | Lots | Shares | Amount |
|---|---|---|---|
| Retail(Min) | 1 | 2,000 | ₹1,08,000 |
| Retail(Max) | 1 | 2,000 | ₹1,08,000 |
| HNI(Min) | 2 | 4,000 | ₹2,16,000 |
Identical Brains Studios Reservation Details
Below are the limits for the shares offered in the different investor categories for the IPO:
| Investor Category | Shares Offered |
| QIB Shares Offered | Not more than 50.00% of the Net Offer |
| Retail Shares Offered | Not less than 35.00% of the Net Offer |
| NII (HNI) Shares Offered | Not less than 15.00% of the Net Offer |
Identical Brains Studios IPO Anchor Investors Details
Identical Brains Studios IPO raises ₹5.66 crore from anchor investors. Identical Brains Studios IPO Anchor bid date is December 17, 2024.
| Bid Date | December 17, 2024 |
| Shares Offered | 10,48,000 |
| Anchor Portion Size (In Cr.) | 5.66 |
| Anchor lock-in period end date for 50% shares (30 Days) | January 22, 2025 |
| Anchor lock-in period end date for remaining shares (90 Days) | March 23, 2025 |
About the Company
That concludes the details of the Identical Brains Studios IPO. Now, let’s shift our focus to explore more about the company’s background, operations, strengths and risks, financial statements and key highlights.
Established in 2019, Identical Brains Studios Limited is an Indian media and entertainment company engaged in computer-generated visual effects (VFX) services and post-production services, established to cater to a broad spectrum of industries such as films, web series, TV series, documentaries and commercials. The company offers a wide array of VFX services that include 3D modeling, animation, compositing, rotoscoping, CGI integration, visual effects supervision and concept art for films, TV series, web content and commercials.
Its services cater to both domestic and international markets, with growing demand from streaming platforms such as Netflix, Amazon Prime and Disney+, which require high-quality VFX to compete globally. The company’s portfolio includes well-known projects like Scam 1992: The Harshad Mehta Story, Rocket Boys and Adipurush.
The company has provided VFX services for films that received two Filmfare OTT Awards nominations, one Filmfare Awards nomination, one Dadasaheb Phalke Awards nomination and more for Best Visual Effects.
The company has also won two Filmfare OTT Awards for Best Visual Effects for Scam 1992: The Harshad Mehta Story (2020) and Rocket Boys (2022) in association with Variate Studios LLP and one Dadasaheb Phalke Awards for Phone Bhoot (2022) for Best Visual Effect.
Competitive Strengths:
- Operations in economically attractive locations.
- Integrated technology and infrastructure.
- Skilled creative and technical workforce.
- Reputation as a trusted provider of VFX Services with established relationships throughout the Entertainment Industry.
- Attractive business model with significant revenue visibility and compelling opportunities for long-term margin expansion and cash flow generation.
- Experienced management team with managerial, creative and technical expertise and industry relationships.
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Objectives of Identical Brains Studios IPO
The company intends to utilize the proceeds of the issue to meet the following objectives:
- Funding capital expenditure towards the renovation of the existing Andheri office and studio.
- Funding capital expenditure towards establishment of Colour Grading Digital Intermediate (“DI”) and Sound Studio set up for a new branch office in Andheri.
- Funding capital expenditure towards the establishment of a new branch office in Lucknow.
- Funding capital expenditure for the purchase of computers, storage systems and software to further strengthen the existing facilities/offices of the company.
- Funding the incremental working capital requirements.
- General corporate purposes.
Identical Brains Studios Limited Financial Information (Restated)
The revenue of the company increased by 150.71% and profit after tax (PAT) rose by 231.5% in FY2023-24 (April 1, 2023 – March 31, 2024).
| Period Ended | 31 Mar 2022 | 31 Mar 2023 | 31 Mar 2024 | 30 Sep 2024 |
| Assets | 226.38 | 475.50 | 1,702.39 | 2,183.64 |
| Revenue | 390.75 | 808.26 | 2,026.38 | 1,149.62 |
| Profit after Tax | 51.01 | 161.28 | 534.65 | 240.54 |
| Net Worth | 127.23 | 288.51 | 1,203.62 | 1,436.08 |
| Reserves & Surplus | 126.23 | 287.51 | 514.82 | 402.89 |
| Total Debt | – | – | 19.04 | 17.09 |
| Amt in ₹ Lakhs | ||||
Key Performance Indicators
The current market capitalization of Identical Brains Studios Limited is ₹75.74 Cr and if we talk about the key performance indicators (KPIs) of the company, then the ROCE and PAT Margin as of 31 March 2024 are 103.52% and 26.62% respectively.
| Key Performance Indicators | Value |
|---|---|
| ROE | 71.66% |
| ROCE | 103.52% |
| Debt/Equity | 0.02 |
| RoNW | 44.42% |
| Price to Book Value | 4.64 |
| PAT Margin | 26.62% |
The EPS and PE ratios before and after the Identical Brains Studios IPO issue are detailed in the list below:
| Ratios | Pre IPO | Post IPO |
| EPS (₹) | 5.17 | 3.43 |
| P/E (x) | 10.44 | 15.74 |
- The Pre-IPO EPS is calculated based on the pre-issue shareholding as of the RHP date and the latest FY earnings available in the RHP, as of March 31, 2024.
- The Post-IPO EPS is calculated based on the post-issue shareholding and the annualized FY earnings as of September 30, 2024, as provided in the RHP.
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Identical Brains Studios IPO Review (Apply)
- Revenue Growth: There has been significant revenue growth over the past three years: ₹390.75 lakhs (2022) → ₹808.26 lakhs (2023) → ₹2,026.38 lakhs (2024). This reflects steady growth and a strong market presence.
- Profit Growth: The Profit after tax (PAT) has increased from ₹51.01 lakhs (2022) to ₹534.65 lakhs (2024). With a PAT margin of 26.62%, the company demonstrates strong profitability, which is impressive for the media sector.
- Strong Reserves: Reserves have grown from ₹126.23 lakhs (2022) to ₹514.82 lakhs (2024), indicating the company’s ability to reinvest for business expansion.
- Valuation Metrics: Pre-IPO P/E: 10.44 | Post-IPO P/E: 15.74
The average P/E ratio of the entertainment sector is around 38x, so the IPO looks undervalued.
- Return on Capital Employed (ROCE) and Return on Net Worth (RoNW):
ROCE: 103.52% reflects the company’s capital efficiency.
RoNW: 44.42% is good for long-term investors.
- GMP and IPO Price Band: With a price band of ₹51- 54 and a GMP of ₹38, the market shows a great interest, suggesting a potential listing gain of around 70%.
Strengths
- The company claims to have a robust infrastructure featuring state-of-the-art software, hardware and proprietary tools that enhance the VFX production pipeline.
- The studio claims to be a Trusted Partner Network (TPN)-audited VFX provider, which delivers high-quality visual effects tailored to the stringent standards of the US and European markets. As part of the TPN initiative, which is a global effort to protect film and television content, the studio ensures stringent security measures to prevent leaks, breaches and hacks of clients’ productions before their official release, thereby upholding industry standards for content security.
- The company claims to have longstanding relationships with major Bollywood studios and new-age production houses. This network provides consistent revenue visibility and positions the studio to participate in sequels and spin-offs of major franchises.
Risks
Here are some of the risk factors involved in the IPO that investors should know before subscribing to the issue. These risk factors have been highlighted by Identical Brains Studios in its Red Herring Prospectus (RHP):
- High Dependence on Bollywood Studios contracts: Identical Brains Studios relies heavily on its relationships with major Bollywood studios, key executive and creative professionals. These studios accounted for 64.99%, 67.51% and 66.49% in FY22, FY23 and FY24 to the revenue from operations. Any disruption in these relationships or changes in the studios’ production strategies could impact the company’s revenue.
- Dependence on subcontractors and direct contracts with films: A substantial portion of the company’s operations depends on a combination of direct contracts with film and content producers and subcontracting arrangements. Subcontracting accounted for 36.94%, 28.42% and 14.81% of projects in FY22, FY23 and FY24 respectively. This reliance on third-party recommendations highlights the need to maintain strong industry relationships and a positive reputation. Any weakening of these relationships could hinder the company’s ability to secure new projects and sustain its growth trajectory.
- Revenue concentrated in a few states poses geographic risks: The company’s operations are based in Palghar and Lucknow. Any adverse political, social, or economic developments in these regions could disrupt the company’s operations, adversely impacting its finances.
- Regulatory investigations may lead to penalties or disruptions: The company, its promoters and its directors are currently involved in legal proceedings. Any adverse judgments in any of these cases could be detrimental to the company’s business.
- Revenue dependent on a few customers poses financial risks: A major portion of the company’s revenue is dependent on a few customers. The top 10 customers of the company contributed 82.29%, 80.01% and 76.55% to the revenue from operations in FY22, FY23 and FY24 respectively. The loss of any of these customers or a reduction in business from them could hit the company’s operations and financial performance.
All the above-mentioned risks should be considered by investors before deciding to invest in the IPO.
Opinion
Given the company’s financial growth, strong fundamentals and great listing gain potential, the IPO appears attractive and therefore can be applied. However, since the IPO is from the SME sector, which typically carries higher risks, you should plan accordingly by considering the following points:
- Long-term investors might consider holding their investments for the medium to long term as the IPO looks reasonable at current valuation.
- Since the IPO appears to be under-priced, short-term investors should monitor the GMP trend on the listing day for potential short-term gains, which currently looks promising with a 70% return on the listing date.
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Additional Details
Promoter Holding
Mr. Raghvendra Rai and Mr. Sameer Rai are the promoters of the company. Their shareholding before and after the issue is as follows:
| Pre-Issue Shareholding | 86.53% |
| Post-Issue Shareholding |
Identical Brains Studios IPO Allotment Status: Check Now
Identical Brains Studios Limited Contact Details
Address: 802, 803 and 804, Crescent Royale, Veera Desai Road, off. New Link Road, Oshiwara, Andheri, Mumbai – 400053
Phone: 022-68943898
Email: [email protected]
Website: https://identicalbrains.com/
Identical Brains Studios IPO Registrar Details
Registrar: Bigshare Services Private Limited
Phone: +91-2262638200
Email: [email protected]
Website: https://ipo.bigshareonline.com/IPO_Status.html
Disclaimer : We are not a SEBI-registered research analyst. This article is written solely for educational purposes and should not be interpreted as investment advice or recommendation. The stock market involves significant risks, so we encourage you to seek guidance from a financial advisor before making any investment decisions.
FAQs
Q1. What is Identical Brains Studios IPO?
Identical Brains Studios IPO is book built IPO issue and is entirely a fresh issue, where the company aims to raise ₹19.95 crore through this IPO.
Q2. What is the price band for Identical Brains Studios IPO?
The price band for this IPO has been fixed at ₹51 to 54 per share. This price range presents a good opportunity for investors.
Q3. What are the important dates for Identical Brains Studios IPO?
The IPO opens on 18 December 2024 and closes on 20 December 2024. The listing of shares will take place on 26 December 2024 on NSE SME.
Q4. How many shares are being offered in the Identical Brains Studios IPO?
A total of 36,94,000 shares are being offered in the company’s IPO. These shares are entirely part of the fresh issue, meaning the company is arranging the funds to strengthen the company.
Q5. What is the lot size for Identical Brains Studios IPO?
The lot size for the Identical Brains Studios IPO is of 2,000 shares and minimum investment required is ₹1,08,000.
Q6. How to apply for Identical Brains Studios IPO?
You can apply for the Identical Brains Studios IPO online. The application can be made via UPI, and the deadline for submission is 20 December 2024.
Q7. What is the expected listing gain for Identical Brains Studios IPO?
The Grey Market Premium (GMP) for the Identical Brains Studios IPO has reached ₹38, indicating an expected listing gain of around 70%.
Q8. What is the business model of Identical Brains Studios IPO?
Identical Brains Studios IPO is an entertainment company that offers various computer-generated visual effects (“VFX”) services.
Q9. Is Identical Brains Studios IPO a good investment?
Given the company’s financial performance and business stability, Identical Brains Studios IPO could be an attractive investment. Considering the high GMP and fair valuation, it can be suitable for both short-term and long-term investors.
