Sea TV Network IPO Review and Analysis – Crap trying to Smell like Flowers in Indian Bull Market

India has seen a flurry of IPO’s in the current month of September 2010 as the companies IPOing in this month will not have to submit the June end quarter financials.A Number of good IPOs have been mixed with a number of bad ones.However SEA TV Network is the crappiest of the lot by a wide margin.Indian markets have seen some really junk offerings but this one surely takes the cake.The company is one of the thousands of small time cable operators in the country trying to masquerade as a big multi system operator(MSO) .It operates in the small city of Agra and is raising money ostensibly to become an all India operator by opening up 20 offices in Agra itself.This is one issue which even super risky investors should avoid.The company has made a profit of Rs 1.5 ($400,000) crore and  it still has negative cash flow.For this “huge” profits it wants its market cap to be Rs 120 crores by raising Rs 50 crore from investors.This in a industry which does not have a lot of receivables as cash collection is done from subscribers.The company despite its small scale of operations,shoddy financials,management without many qualifications and facing high degree of competition from huge DTH players wants a high valuation.The Grading of this company is 1 by ICRA which I think was constrained by lack of Zero or Negative Ratings.

Sea TV Network is The Worst Company  I have seen coming out in the primary market of India.The company is valuing itself at a trailing P/E of 80x and P/B of around 12x despite negative cash flows for most is its history.It is a very small fish in a highly competitive environment.It has civil and criminal cases against its promoters.It tried its hand and failed at doing its IPO in the 2008 Bull Run and is trying its luck again it the current bull run using an unherad of investment banker.