The four-day SME initial public offering (IPO) of Crayons Advertising will open for subscription today on the National Stock Exchange (NSE). On listing, Crayons Advertising will become India's first major homegrown integrated advertising agency to go public. The issue, which closes on May 25, has a price band of ₹62 to ₹65. The offer is completely a fresh issue of 64.30 lakh equity shares which will fetch ₹41.80 crore at the upper end of the price band of ₹65. The fund raised via the IPO route will be utilised for capital expenditure on infrastructure and cutting-edge technology.
Here are key things to know before investing in Crayons Advertising’s IPO
The IPO of the homegrown integrated advertising agency will open today and close for public subscription on May 25, 2023.
The allotment of shares will be done on May 30, while stock will be listed on NSE’s SME platform on June 2.
The company has set the price band of ₹62-₹65 per share (₹10 face value) through the book-building route.
The company will raise ₹41.79 crore at the upper price band of the issue.
As per the offer document filed with SEBI, not more than 50% of the net offer is reserved for the qualified institutional buyers (QIBs), 15% for the Non-institutional investor (NII) or HNI investors, and not less than 35% for the retail investors. The company has set aside 329,600 shares for the market maker of the IPO, SS Corporate Securities.
Retail investors can only apply for a lot size of 2,000 shares, entailing an investment of ₹130,000 at the upper end of the price band. However, HNIs, NIIs can bid for maximum of 2 lots of 4,000 shares worth ₹260,000.
Ahead of the IPO, the company issued 18.30 lakhs shares to the anchor investors, including Europe’s bank Societe Generale ODI, Aegis Investment Fund PCC, Rajasthan Global Securities, Nav Capital VCC- Nav Capital Emerging Star Fund, among others.
Incorporated in 1986, Crayons Advertising provides a high-end ecosystem and end-to-end ad-tech communication solutions platform for advertising media services consisting of brand strategy, events, digital media, Print Media, and Outdoor (OOH) Media services, which cover advertisement modes such as Newspapers, Brochures, Magazines, Television Channels, FM channels and display of Outdoor Hoardings, etc.
The company plans to invest in setting up its own film and animation studios and enhance its existing foundation of Web3 capabilities to offer more dynamic Metaverse solutions, including AR, VR and other emerging immersive tech. It also plans to enhance a wide array of event offerings with new-age technology applications to allow omnipresence, scale up the OOH business and acquire talent from the international market. The public issue proceeds will be utilised for capital expenditure on infrastructure & cutting-edge technology.
In the last three fiscals, Crayons Advertising posted a total revenue of ₹163.68 crore (FY20), ₹106.61 crore (FY21), and ₹194.05 crore (FY22). The net profit for FY20, FY21, and FY22 stood at ₹1.17 crore, ₹0.13 crore, and ₹1.61 crore. For 9M of FY23, net profit was at ₹12.67 crore on total revenue of ₹203.75 crore.
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