Pentafour Software has outlined plans to take on global film distribution and is on the lookout for suitable tie-ups in this area.
Pentafour Software and Exports differentiates itself from its software peers on the basis of large exposure to high margin multimedia business. It has a competitive edge in multimedia due to its excellent track record and long term relationships with global multimedia companies. It is one of the few companies worldwide that can produce complete content for multimedia-based movies, and was ranked as the No. 3 company in the world by a recent study in computer animation.
Close on the heels of the spin-off of its software division, Pentafour Software is scouring the landscape for tie-ups in film distribution. As reported by a leading financial daily, the company will focus on films, broadcasting video, CD/DVD and Internet entertainment. The company's interest in film distribution was fuelled by the Roncarelli Report of the Computer Animation Industry, which ranked the company as No. 3 in the world.
Another reason why the company has identified film distribution is due to the long delays that some of the company's releases have faced in the past.
Pentafour is also very bullish on Internet broadcasting and has been seeking VSNL's help for a 2 MB bandwith to enable it to broadcast live on the Net the carnatic music festival of Kalarasana from the Rani Meyyamai Hall. This will be a path-breaking feature on the Internet.
Film distribution and multimedia have got little synergies. Moreover, the company has no experience in film distribution. But it will try to correct that by tying up with a more experienced player. The upside of making a foray in film distribution will be that Pentafour will be able to ensure that its films are released without any delay. This will ensure that money from the film will start flowing sooner than at present.
Pentafour's stock has been trading at a discount to its peers largely due to poor management perception. However, analysts agree that the software division hive-off will have a positive impact on the company's share price. This combined with the fact that its 2QFY2000 performance (net profit up 67%) was good, has made analysts recommend a 'BUY' on the company.
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