Connplex Cinemas IPO

About Connplex Cinemas IPO

The offer consists of a fresh issue component. The fresh issue will include up to 51,00,000 equity shares of ₹ TBA each. The total number of shares and aggregate amount are 51,00,000 shares aggregating up to ₹90.27 crores.

Connplex Cinemas Limited is distinguished by their customer experience which includes cinema making, film distribution, programming and latest technologies. Their strategic locations and theatre technologies give them an edge in attracting and retaining audiences. They cater to a diverse audience, including families, young adults, and cinema enthusiasts, with programming designed to engage these segments through a mix of mainstream blockbusters, art films, and themed events. Their cinemas are constructed and designed with a deep understanding of customer preferences and regional nuances. With a majority of recliner seating, sound systems, and high-definition projection technology, they ensure that every aspect of the movie experience is elevated.

Objective of Connplex Cinemas IPO

• Funding capital expenditure requirement for purchase of corporate office.
• Funding capital expenditure requirement for purchase of LED screens and projectors.
• Funding working capital requirement.
• Funding general corporate purposes.

Industry Outlook

The Indian M&E industry is on an impressive growth path. The industry is expected to grow at a much faster rate than the global average. This can be largely credited to rising incomes, increasing internet penetration, and a growing push toward digital adoption. In the long run, growth in the M&E industry is expected in retail advertisement, driven by several players entering the food and beverages segment, e-commerce gaining more popularity in the country, and domestic companies testing the waters. India’s rural regions are expected to be the next frontiers for growth. India has also adopted 5G and is already planning for 6G well ahead of schedule. This push towards digital adoption, especially in rural regions, will provide advertisers and publishers with significant opportunities to capture untapped markets and help grow India’s media and entertainment industry.

There were 339 films released across 38 countries, up from 33 countries in the previous year. They generated a gross box office collection of ₹19 billion, 19% more than 2022. Film viewership remains a very important part of television; film channels accounted for 26% of total TV viewership in 2023, up from 25% in 2022.

Cinema advertising generated ₹750 crores in 2023, a 50% rise attributed to successful movies and the scarcity of avenues to reach affluent audiences.

Company Information

Connplex Cinemas Limited is an entertainment company. The company is engaged in the business of the development of theatres, entering into franchise agreements specialising in the exhibition and distribution of films, sharing revenue of screening of movies, sale of food and beverages, and sharing of revenue from the sale of food and beverages and advertisements at various franchised cinema, and other related business under the brand name “CONNPLEX” and other brands registered under the name of the company. They operate a network of cinemas offering a diverse range of cinematic experiences that cater to various audience preferences.

Their business is built on three main pillars: making/developing cinema theatres, film exhibition & film distribution (including event hosting), and revenue sharing/sale of food and beverages and other revenue including advertisement sharing. Additionally, they collaborate with filmmakers and studios to distribute films across their theatres and digital platforms, focusing on strategic marketing to maximise audience reach. Beyond regular screenings, they also provide event spaces for private screenings, corporate events, and community gatherings, creating additional revenue streams and engaging their local communities.

They are distinguished by their customer experience which includes cinema making, film distribution, programming and latest technologies. Their strategic locations and theatre technologies give them an edge in attracting and retaining audiences. They cater to a diverse audience, including families, young adults, and cinema enthusiasts, with programming designed to engage these segments through a mix of mainstream blockbusters, art films, and themed events.

Strengths of Connplex Cinemas IPO

• Experience and new technology.
• Strong franchisee support system & quick franchise setup process.
• Strong diversified revenue stream.
• Strategic location in emerging markets.
• Variety of cinema formats to ensure they meet the diverse needs of their audience.

Risks of Connplex Cinemas IPO

• Patrons may intentionally or unintentionally cause damage to cinema screens.
• Inadequate audience turnout could result in a decline in revenue.
• Equipment breakdowns and rising costs of premium technology installations.
• Fluctuations in food and beverage sales.
• Changes in movie release schedules could result in resource inefficiencies and lower audience attendance.

Anchor Investor Information

The Anchor Investor Bid/Issue Period shall be one Working Day prior to the Bid/Issue Opening Date.

IPO Registrar and Book Running Lead Managers

Book running lead managers:

Beeline Capital Advisors Private Limited

Registrar for the IPO is MUFG Intime India Private Limited

Business Model

The company earns its revenue by offering the following:

• Making/developing of cinema theatres.
• Film exhibition & film distribution (including event hosting).
• Revenue sharing/sale of food and beverages, and other revenue, including advertisement sharing.

Company Growth Trajectory

Revenue from operations had increased by 137.68% from ₹25.37 crores in fiscal 2023 to ₹60.30 crores in fiscal 2024, due to an increase in sales of products and other operating revenue during the year. Other income had increased by 123.97% from ₹0.24 crores in fiscal 2023 to ₹0.54 crores in fiscal 2024, mainly due to an increase in interest on FDR, which rose from ₹0.16 crores in fiscal 2023 to ₹0.38 crores in fiscal 2024; an increase in other income, which rose from ₹0.06 crores in fiscal 2023 to ₹0.11 crores in fiscal 2024; and profit on sale of fixed assets, which increased from nil in fiscal 2023 to ₹0.03 crores in fiscal 2024.

Company Market Position

The company’s strategic emphasis on emerging markets, particularly in tier 2, 3, and 4 cities, positions them as a player in regions where larger competitors and major cinema chains have been reluctant to establish a presence. They have identified high-potential markets with limited competition, where their cost effective and luxury-focused cinema model has successfully captured substantial market share. By entering areas with high demand and low existing supply, they can build a strong presence in underserved and relatively rural communities.

How To Check Allotment Status of Connplex Cinemas Limited IPO?

You can check the allotment status of shares either on the website of the National Stock Exchange (NSE) or on the website of the registrar MUFG Intime India Private Limited. To check the status on the NSE website:

• Visit the NSE website
• Click on “Investor Services” and choose “Application Status Check”
• Choose the issue type — Equity or Debt (Equity in this case)
• Select the Issue Name from the drop-down. The issue name is the company’s name, which is Connplex Cinemas Limited
• Enter your application number or PAN number
• Check the box which says “I’m not a Robot” and click on “Search” to know the allotment status

Follow these steps to know the allotment status on the registrar’s website:

• Visit the MUFG Intime India Private Limited website
• Choose “Public Issues” from the “Investor Services” drop-down
• Select Connplex Cinemas Limited from the drop-down
• Enter your PAN number or Application number
• Click on “Submit” to know the allotment status