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Radio City eyes valuation of Rs 1,900 cr, fixes IPO price band at Rs 324-333

MUMBAI: Music Broadcast Ltd (MBL), which operates radio stations under the Radio City brand name, is looking at a valuation of almost Rs 1,900 crore through its public float.

Entertainment Network (India) Ltd, which runs stations under the Radio Mirchi brand, has a market valuation of Rs 3,923 crore. The Times Group-promoted ENIL got listed in late 2005.

MBL, the radio arm of Jagran Prakashan, will be the second radio operator in India to go for an initial public offering (IPO).

MBL has fixed the price band of its IPO at Rs 324 per share at the lower end and Rs 333 at the upper end.

The company will be able to raise Rs 400 crore through the IPO at the upper price band. The IPO will fetch Rs 389 crore at the lower end of the price band.

The size of the issue is 14.67 million shares, out of which existing shareholders will sell about 2.66 million. The issue will reflect a dilution of 25.71% stake on post-offer equity capital.

The IPO will open on 6 March and close on 8 March. The anchor book will open on 3 March.

India’s first private FM radio broadcaster, Radio City has grown from four cities in 2001 to 37 cities as on February 2017.

MBL has presence in 12 out of the top 15 cities of India by population. The company acquired 11 additional radio stations under the Phase III policy.

Besides having a presence in 37 cities, MBL has a sales alliance with ITM Software & Entertainment Private Ltd (ITM) which operates “Suno Lemon 91.9 FM” (Suno Lemon) in Gwalior, and Ananda Offset Private Limited (“AOPL”) which operates “Friends 91.9 FM” (Friends FM) in Kolkata.

Pan India Presence 28.02.17

MBL also operates online web radio on its web portal Planet Radio City. It runs 40 web radio stations through in eight languages.

Radio City has seen CAGR in advertising volume of ~12.5% over a 5 year period while the industry has seen a 5 year advertising CAGR of 10.4%, according to AirCheck data.

FY16 Advertising Volume 28.02.17

MBL will list the shares on the BSE and the NSE.

For the first six months of this fiscal ended 30 September 2016, MBL posted a net profit of Rs 29.76 crore on a revenue of Rs 138.21 crore.

In December 2014, Jagran had acquired Radio City 2014 for Rs 434 crore (Rs 4.34 billion). The acquisition was completed in June 2015.

15 yrs Radio City 28.02.17

After the acquisition, the company demerged its FM radio business Shri Puran Multimedia Ltd (SPML), which operates Radio Mantra FM stations, into Radio City’s holding company MBL. Consequently, MBL added eight Radio Mantra stations present in the cities of Jalandhar, Agra, Bareilly, Gorakhpur, Hisar, Karnal, Ranchi and Varanasi to its slate of stations.

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