Market is eagerly waiting for Padmalaya's listing, which was one of the reasonably-priced media IPO in the recent past. The company had offered 25 lakh equity shares of Rs 10 each at a premium of 90.

Even when the market condition was not so good, the IPO was oversubscribed by almost six times. The IPO was reasonably priced when other media players had offered shares at a hefty premium.

The company should command a premium of at least 100 per cent over its offer price and if the market condition remains normal for the next couple of weeks, it should be listed at around Rs 200, according to a broker.

Interestingly, the company does not see a hefty premium on listing as it believes the market price should be purely performance linked. ``I don't see a price of Rs 600-700 for the company. We believe in slow and steady growth and we expect the stock market to reflect that in the same fashion,'' said the senior company official.

``We were not into a very high margin business compared to IT earlier. But at present our margins have improved considerably. We are getting into animation business in a major way which is a high margin business compared with hiring out studio for film production. We are looking at overseas market for this business. I would be more than happy if Padmalaya stock trade in a price range of Rs 150-200 for the next few days,'' said the official.

The company is setting up a Rs 54.25-crore project. The company is enhancing facilities for higher volume of TV software production integrated studio for 2D/3D animation projects, design shop for web ads and film trailors at a total cost of Rs 17.75 crore.

The company is also tying up with Penta Media for consultancy services, supply of software and training to set up 2D/3D (total deployment Rs 3 crore) and is setting up an integrated television software studio at a total cost of Rs 4.5 crore.

Around Rs 5 crore is earmarked for procurement of films for library. Of the issue proceeds, Rs 19.8 crore is going towards working capital requirements.

For the 12-month period ended September 1999, the company recorded a net profit of Rs 3.63 crore on turnover of Rs 17.82 crore. For the four and half period ended February 2000, the company recorded a net profit of Rs 2.61 crore on turnover of Rs 7.8 crore.

The company, which is a fully integrated television software and content provider, is confident of achieving the projected profitability targets.The company has projected a total turnover of REs 70.29 crore and net profit of Rs 25.67 crore for fiscal 2001. The IPO was lead managed by Karvy Consultants. The issue opened for subscription on May 31 and closed on June 6.