Identical Brains Studios hit 5% upper circuit after listing at 76% premium on NSE SME platform

Identical Brains Studios Ltd made a stellar debut on the stock exchanges on Thursday, December 26, with its shares listing at a premium on the NSE SME platform.

Shares of the VFX services provider were listed at ₹95 apiece on the NSE Emerge platform, at a premium of 76% compared to the IPO price of ₹54 apiece.

However, after listing, the stock saw volatile trading, hitting the 5% lower and upper circuit within the first hour of trading. At 11:00 a.m., the stock was trading at ₹99.75 apiece, up 5%.

Within the initial ten minutes of trade, as many as 14.22 lakh shares of Identical Brains Studios were traded on the stock exchange, with the total trading value reaching ₹13.26 crore. The company's market capitalisation stood at ₹139.91 crore.

As the minimum application size in the IPO was a single lot of 2,000 shares, the investors, who were allotted at least one lot would have made a profit of ₹82,000 after listing.

At the listing price of ₹ 95, the total value of a single lot of shares of Identical Brains Studios Ltd bagged by an investor in the allotment is ₹1,90,000 (₹95 x 2,000). Thus, investors who bagged shares in the IPO allotment would have made gains against the minimum investment of ₹108,000 per lot (₹54 x 2000).

Identical Brains Studios Ltd. provides computer-generated visual effects (VFX) services for various projects, such as films, web series, commercials, TV shows, and documentaries.

As the company specialises in the VFX effects, it earned two nominations at the Filmfare OTT Awards and one nomination at the Filmfare Awards.

The company last week raised ₹ 19.95 crore through its IPO which was open for subscription on the NSE SME platform.

At the close of the public offer, the IPO was subscribed 544.36 times, led by strong demand from Non-Institutional Investors (NIIs). The IPO attracted applications for 134 crore shares compared to 24.6 lakh shares on offer for subscription.

The NIIs quota was booked 1,020.55 times, while the Qualified Institutional Buyers’ (QIBs) portion was subscribed 187.36 times. The retail quota was subscribed 544 times.

Identical Brains Studios IPO was a fresh issue of 36.94 lakh shares. The company had set the price band at ₹51 to ₹54 per share.

Socradamus Capital Private Limited was the book running lead manager. Bigshare Services Pvt Ltd is the IPO registrar.

According to its RHP, the company would utilise ₹51.78 lakh of IPO proceeds for capital expenditure on renovating its Andheri office and studio. As much as ₹2.86 crore will be used to fund capital expenditure on setting up Colour Grading Digital Intermediate (“DI”) and Sound Studio Set up at the new branch office in Andheri. It will spend ₹75.56 lakh on establishing a new branch office in Lucknow.

The company has proposed using a portion of the IPO proceeds to fund capital expenditures, such as purchasing computers, storage systems, and software, to further strengthen the existing facilities.

Identical Brains Studios reported a profit after tax (PAT) of ₹5.34 crore for 2023-24 (FY24), up by 231.67% compared to ₹1.61 crore in 2022-23 (FY23). Revenue from operations jumped by 149.75% to ₹20.08 crore in FY24 compared to ₹8.04 crore in FY23.