Tips Industries: Entertaining gain

Tips Industries: Entertaining gain

Shares of Tips Industries (TIL) were locked in 5% upper circuit for the fourth straight day at Rs 1,124.80 on the BSE on Friday in an otherwise weak market after the company reported robust set of numbers for the March quarter (Q4FY21).
The stock of the movies & entertainment company was trading at its all time high level. In the past one week, the stock has rallied 26%, as compared to 1.4% decline in the S&P BSE Sensex. The stock is trading in ‘T’ group on the BSE and ‘BE’ segment on the National Stock Exchange (NSE). Shares falling in the Trade-to-Trade or T-segment are traded in BE series and no intraday is allowed. This means trades can only be settled by accepting or giving the delivery of shares.

In Q4FY21, TIL posted consolidated net profit at Rs 18.3 crore against Rs 0.40 crore in Q4FY20. Revenue from operations grew 49.3% year on year at Rs 27.60 crore from Rs 18.5 crore in the year-ago quarter. Ebitda (earnings before interest, taxes, depreciation, and amortisation) margin stood at 71.9% against 1.3% in previous year quarter.
To unlock value of both businesses and result in shareholder value maximization, the company’s board approved demerger of TIL in two separate entity Tips Industries and Tips Films, to transfer films production business in separate entity.

The demerger will enhance efficiencies and will have different business interest into separate corporate entity, resulting in operational synergies, simplification, focused management, streamlining and optimization of the group structure and efficient administration, the management said. The same would result in stability of revenue and profitability of music Segment Company. The demerge would also enhance business operations by streamlining operations, cutting costs, more efficient management control and outlining independent growth strategies.

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