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Eros International reaffirms strong financials after shares plummet

Eros International reaffirms strong financials after shares plummet

Global Indian Entertainment Company, Eros International Plc announced its share repurchase program of up to $20 million of outstanding common shares on 9th June 2019. This announcement came after shares of Eros International Plc nosedived on 6th June 2019. Eros International Media Ltd is the Indian arm of Eros International Plc.

 

Downgrading in the ratings

 

On 5th June 2019, Credit Analysis and Research Limited (CARE) Ratings downgraded ratings of Eros International Media Limited. The credit rating agency revised ratings assigned to the bank facilities of Eros International Media Ltd. The company delayed servicing of Bank loans in the month of April 2019 and May 2019. This resulted in the downgradation in the rating of Eros International Media Ltd. Furthermore, CARE rating agency revised ratings of Long-Term Bank Facilities (Term Loan) of Eros International Media Limited to CARE D from CARE BBB- (Triple B Minus). The ratings of Long-Term Bank Facilities (Cash Credit) downgraded from CARE BBB- to CARE D. The ratings of Short-Term Bank Facilities downgraded from CARE A3 to CARE D.

 

Share repurchase program

 

In order to reiterate positive business fundamentals and achieve a strong financial position, Eros International Plc released the share repurchase program. The company is planning to buy back up to $2 crores of outstanding common shares. The mode of purchase will be either the open market or privately negotiated transactions. The company is purchasing shares at management’s discretion from time to time. The company’s repurchase program won’t have any specific time period. Further, the company won’t constrain itself to purchase any specific number of shares.

 

Increase in the subscriber base of Eros Now

 

Eros Now is a subscriber based South Asian Entertainment Video Service of Eros International Plc. The company declared the rise of 138% paid subscribers over the past 12 months. Furthermore, the company is currently serving to 18.8 million paid subscribers and 154.7 million registered users. This is representing an 18% increase in paid subscribers over the previous quarter. The company’s target was to reach up to 16 million subscribers for the full fiscal year 2019. Eros Now has digital rights to over 12,000 films.

 

About Eros International Plc

 

Eros International Plc acquires, co-produces and distributes Indian films in multiple formats such as cinema, television and digital new media. They are the first Indian media company to get listed on the New York Stock Exchange (NYSE). Currently, the entertainment company has aggregated multi-format rights over 3,000 films of different genres, budgets, and languages.

 

Stock Movement

 

On 6th June 2019, Eros International Plc closed at $ 3.70 recording decrease of 50% from the previous closing of $ 7.29 on 5th June 2019 on NYSE. Furthermore, on 7th June 2019, it plunged to $ 3.30.

On BSE, shares of Eros International Media which is Indian arm of Eros International Plc hit lower circuit on 9th June 2019. The share price declined by 9.9% and recorded at Rs 40.95 apiece.

 

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