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Adlabs Films: Action begins now

Apr 30, 2001

Adlabs Films, recently listed film processing major has recorded encouraging results for the year ended FY01.This appears to have driven by a couple of mega bollywood hits during the year. As the number of prints for a particular movie increases, the incremental operating profits of the company increases considerably. The company has near monoploy in film processing business.

(Rs m) 3QFY01 FY01
Sales 113 464
Other Income 6 28
Expenditure 69 312
Operating Profit (EBDIT) 44 152
Operating Profit Margin (%) 38.9% 32.7%
Interest 2 2
Depreciation 3 12
Profit before Tax 45 165
Other Adjustments    
Tax - 50
Profit after Tax/(Loss) 45 115
Net profit margin (%) 39.8% 24.9%
No. of Shares (eoy) (m)   21.5
Diluted Earnings per share 5.4
P/E (at current price) - 10.1

However, the operating margins have shown a dip from 38.8% in 3QFY01 to 32.7% for the full year. This could be attributed to the fact that most of the mega movie business was booked in the third quarter of the year. Again, new film releases took a dip in the last quater following the arrest of big ticket producer, Mr. Bharat Shah.

At the current market price of Rs 54 it is quoting at 10 times its FY01 earnings.The company's mega project of creating the world's largest dome theatre has been commissioned and is expected to contribute to revenues from the current quarter. Further, many film projects which were stalled are expected to kick start in the current quarter. The company's future primarily hangs on how well the concept of dome theatre works in India.


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