Eros International Media's topline boosted more than double in Q2FY16

Eros International Media (EIML) declared its Q2FY16 results yesterday. The company's consolidated revenue increased by more than double to Rs 505 crore in Q2FY16 as compared to same period in previous fiscal year. Its total expenditure increased by 121.76 per cent to Rs 369 crore in Q2FY16 on yearly basis.EIML's total expenditure increased predominantly due to 133.34 per cent increment in operating expenses during the quarter on yearly basis.

EIML's EBITDA rose by 84.85 per cent to Rs 135.66 crore in Q2FY16 as compared to the same period in the previous financial year. However, the company's EBITDA margin contracted by 372 basis points to 26.87 per cent in Q2FY16 on yearly basis. Its net profit increased by 80.1 per cent to Rs 90.3 crore in Q2FY16 as compared to same period in previous fiscal year. But, EIML's net profit margin contracted by 302 basis points to 17.88 per cent in Q2FY16 on yearly basis.

During the quarter, EIML released 20 movies consisting of 16 Hindi and 3 Tamil/Telugu and 1 other Regional film as compared to21 films during Q2FY15. The company's net debt reduced by 10.52 per cent to Rs 280.8 core during H1FY16. Its net debt to equity ratio stood at 0.17 in Q2FY16 as compared to 0.21 as of 31st March 2015.

Wells Fargo downgraded EIML's parent company rating because of a continued increase in receivables in the United Arab Emirates business, concerns on whether Eros would turn free-cash-flow positive, and worry about Eros Now. The latter is a streaming service that allows users to watch content online.

During the fiasco, the share price of EIML plunged about 47.42 per cent till it gave detailed clarification.In the statement ,the company said that In the past two weeks, there has been a vicious campaign to damage the credibility of Eros International by spreading false rumors and misinformation regarding its business with an objective to create panic amongst the investor community. Further, EIML has appointed a US-based law firm to conduct an independent internal review in the wake of an anonymous campaign spreading “false and malicious information” that has negatively impacted the company’s share prices.

EIML's shareholding pattern indicates that FII holdings expanded by 222 basis points to 20.48 per cent while DII holdings contracted by 232 basis points to 0.08 per cent during the September 2015 quarter. The share price of the company increased by 4.69 per cent on bourses and is trading at Rs 280.2 on intraday basis.

EIML operates in the film entertainment industry. The Company co-produces, acquires and distributes Indian language films in multiple formats around the word, including theatrical, cable, satellite and digital new media platforms. It offers film content across Hindi and regional languages, such as Telugu and Tamil. EIML distributes content globally through multiple distribution channels: theatrical, which includes multiplex chains and stand-alone theatres; television syndication, which includes satellite television broadcasting, cable television and terrestrial television, and digital, which includes Internet protocol television, video-on demand, Internet channels and Eros Now. The Company has distribution operations in over 50 countries accessing the South Asian diaspora.