Entertainment firm Eros International on Wednesday sought to assuage investors on its stock price fluctuations, saying downgrading or upgrading of its shares is not a “cause of concern” as nothing has materially changed in its “strong business fundamentals”.
Entertainment firm Eros International on Wednesday sought to assuage investors on its stock price fluctuations, saying downgrading or upgrading of its shares is not a “cause of concern” as nothing has materially changed in its “strong business fundamentals”.
Reacting to reports of San Francisco-based Wells Fargo downgrading the company’s stocks, it said: “We would like to confirm that nothing has materially changed to the strong business fundamentals of the company communicated previously.
“We have significantly grown the business over the last decade and continue to be market leaders in the Indian film industry with a dominant market share of the global Indian box office.”
On the stock price fluctuations, it said: “We believe that the recent movement in share price volatility at our NYSE listed parent level and today at Indian stock exchanges are based on speculative media reports.”
Eros International shares closed on Rs 369.50 per scrip on BSE, up 4.26 per cent from its previous close.
Eros has claimed it has been rated positively by analysts such as Macquarie’s Tim Nollen on the same day as leading Wall Street bank Wells Fargo downgraded its stock.
“Another analysts from Macquarie, Tim Nollen, published a very positive report and maintained outperform rating with a USD 25 price target on the same day…on October 23,” Eros International said in a statement.
It further added that analysts downgrade or upgrade stocks of any company and that “as such is not a cause of concern”.
“Note that Well Fargo did not revise down their earnings estimate for the quarter or the year and the price target is USD 22, well above the price the stock was trading on the date it was published,” Eros said.
Eros, which has significantly grown its business over the last decade, would continue to be market leaders in the Indian film industry with a dominant market share of the global Indian box office, it added.
It further added that the company has continued its growth momentum in the second quarter as well.
“We will be announcing what we expect to be strong second quarter results in the first half of November, which will allow us to demonstrate growth in revenues, profitability and cash flow from operations. As previously announced, we expect that the company will be free cash flow positive by the end of fiscal 2016,” said Eros.
Eros International distributes films in over 50 countries, dubbed and subtitled in over 25 different languages. It has a library of over 3,000 films.
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