Not a stellar opening for an IPO of $11.
By Deepak Chitnis
WASHINGTON, DC: Bollywood giant Eros International finished its debut day at the New York Stock Exchange (NYSE) at $10.88, a 1.09% decrease from its opening price of $11, on Wednesday.
Eros (ticker symbol EROS) debuted with an Initial Public Offering (IPO) of $11 per share, which was a step down from the price it was initially aiming for. Originally, the company was looking at a debut of 12.5 million shares going at somewhere between $15-$17 each. It then came down to $12 apiece for five million shares, but the actual offer ended up being a dollar less. Deutsche Bank, Bank of America, Merrill Lynch, UBS Investment Bank, and Jefferies and Credit Suisse were all lead managers on getting Eros to go public.
Nevertheless, the stock got off to a reasonably good start, peaking at $11.35 at one point. In the afternoon, however, the stock started to dip a bit, ultimately closing at $10.88 on the day.
A film production and distribution house based in Mumbai, Eros International was founded in 1977 and, since then, has been behind some of the highest-grossing films of all time, amassing a film library of over 2,000 titles.
In the 36 years since its inception, it has backed classic films like Sholay (1975) and Mr. India (1987). In recent years, it has become significantly more prolific in its movie production, financing super-hits like Om Shanti Om (2007), Yeh Jawaani Hai Deewani (2013), and the upcoming Ram-Leela, which opens this week.
The company listed close to $208 million in revenue from October 1, 2012 through the end of September 2013. The company has been making moves to expand their business outside of just theatrical Bollywood distribution, having signed deals with TV cable channel HBO and international distribution giant Endemol. The HBO partnership will be to create two channels in India through HBO Asia.
The imminent prospects for Eros will undoubtedly have an impact on the growth of its stock, which has debuted on the NYSE at an unusually saturated time. This week alone, 12 companies have introduced their stocks to be traded. Last week, social media company Twitter – which has become an increasingly indispensable tool in film marketing – also went public to good results thus far.
To contact the author, email to deepakchitnis@americanbazaaronline.com