Dark horse stock of the day: Tips Films locked in the upper circuit

The shares of Tips Films Ltd experienced a sharp rise today, hitting the upper circuit. It began the day at Rs 514.90, a substantial 3.95% up compared to the previous day's closing price of Rs 495.30. The stock surged by 20% during the intraday session with significant volume. 

While writing this article, the shares of the company are up by Rs 99.05 and at Rs 594.35 on BSE. Additionally, the company has experienced a significant increase in its stock price and is currently trading at the upper circuit limit, indicating strong demand and limited supply of its shares. 

Upon analysing today's share volumes, it can be observed that there has been a significant increase of more than 6.55 times in volumes on the BSE. 

The stock's 52-week highs and lows stand at Rs 682 and Rs 296.90, respectively. With a market capitalisation of just Rs 256.93 Crore, the stock has displayed remarkable performance in recent times, delivering a 42% return over the last three months and a 33% return in the last one year.

Regarding ownership, the promoters of the company possess 74.98% of the company's shares. Whereas foreign institutional investors (FIIs) hold 0.08% of the company. The remaining portion, which accounts for 24.94%, is owned by public investors. 

Financial Performance

If we check the company’s financials, in FY23 annual revenue saw a decline of 8.05% YoY, from Rs 67 Crore to Rs 61 Crore. The operating profit of the company stands at Rs 24 Crore, accompanied by an operating profit margin of 39%. Furthermore, the net profit of the company amounts to Rs 24 Crore. 

The company's return on capital employed (ROCE) and return on equity (ROE) are at 38% and 30.5%, respectively. The Book value of the company is Rs 213, whereas the Price to book value is 2.8 times. 

Business Overview 

Tips Films Limited, an India-based company, is primarily engaged in music record label services, film production, and film distribution. The company's operations are focused on a single business segment which is Audio / Video Products. 

With a portfolio of around 50 Hindi movies, Tips Films Limited holds the soundtrack copyrights for each of these films. Additionally, the company extends its product distribution to various international markets, including South Africa, Israel, Malaysia, and others. 

It is actively involved in both the production and distribution of movies, utilising various channels such as satellite, theatrical releases, and digital platforms. Furthermore, the company is also engaged in the distribution of music rights. 

The primary revenue streams for movies typically encompass Digital Rights, Satellite Rights, Music Rights, and Box Office collections. These sources collectively contribute to a film's financial success and long-term profitability in the Indian film industry. 

Tips say, “A well-made film generates revenues for perpetuity, Box Office is not the only arbiter of a film’s fate.” 

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet, and is subject to changes. Please consult an expert before making related decisions.