Shares of this microcap company surged around 7 percent in Monday’s trading session after signing an agreement with CBS Studios to deliver VFX and Virtual Production. In one month, the stock has delivered around 25 percent returns to its shareholders.
Price Movemnet:
With a market capitalization of Rs. 339 crores, the shares of Digikore Studios Ltd started Monday’s trading session on a higher note at Rs. 521.95 compared to its previous close of Rs. 503.65. During the trading session, the shares hit a high of Rs. 543.75, gaining around 7 percent and closed the day at Rs. 535 apiece.
What Happened:
Such a bullish movement in the share price was observed after the company in an exchange filing announced that it had successfully signed an agreement with CBS Studios to deliver VFX and Virtual Production on their global media franchise Star Trek. This move marks the company’s expansion into the American markets.
Furthermore, the company stated that it is the first Indian studio to secure contracts for Virtual Production on any marquee North American project. This contract will position them amongst key players worldwide in Virtual Production services.
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Financials:
Looking at the company’s financial statements, the revenue decreased by 9 percent from Rs. 24.77 crores during H1FY24 to Rs. 22.44 crores in H2FY24. On the other hand, the profits declined by 46 percent from Rs. 6.15 crores to Rs. 3.29 crores during the same period.
Looking at the revenue contribution of the company, it receives 45 percent of its revenue from North America, 35 percent from Europe and the remaining 20 percent from the rest of the world.
Recent Developments:
Earlier, Digikore launched the world’s first cloud-based marketplace of virtual production sets, developed over 16 months. This platform aims to revolutionize global filmmaking by providing extensive opportunities for creators worldwide.
Further, from this Digikore, anticipates significant revenue growth, projecting annual revenues ranging from USD 10 million to USD 200 million within 2 to 4 years, offering virtual production sets for rent at a fraction of the cost of custom sets.
Moreover, Digikore Studios ventured into Content Production for Indian and International OTT Networks in 2022. And aims to produce over 400 episodes every year which will contribute over Rs 120 crores in yearly revenue by 2026.
Important Financial Ratios:
In terms of key financial metrics, the company reported a return on equity of 22.70 percent and a return on capital employed of 27.72 percent for the period spanning FY23-24. Additionally, the net profit margin stood at 20.18 percent during the same timeframe.
Company Profile:
Headquartered in Mumbai, Digikore Studios was incorporated in 2000. The company The company offers Visual Effects (VFX) services for Films, Web Series, TV Series, Documentaries, and Commercials.
Written By Vaibhav Patil
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