IPO Size: Rs. 1,789 cr

• Fresh Issue of Rs. 816 cr for (i) technology and cloud infra Rs. 550 cr (ii) unidentified acquisition
• Offer for Sale (OFS) of Rs. 973 cr, by 4 PEs - Premji Invest, Accel, Norwest, Trudy Holdings (66% combined stake to drop to 47% post IPO)

Price band: Rs. 343-361 per share

M cap: Rs. 7,810 cr, implying 23% dilution

• Only 10% retail and 75% for institutions, as loss for FY23 to FY25

IPO Date: Tue 13^th Jan to Fri 16^th Jan 2026, Listing Wed 21^st Jan 2026

Grey Market Premium (GMP): We are strongly against ‘grey market premium’ as it is an unofficial figure, against SEBI guidelines.

Bengaluru based Media SaaS Company

Amagi Media Labs is an 18 year old software-as-a-service (SaaS) player providing global media companies cloud-native end-to-end solutions across live production, content preparation, distribution, monetization in broadcasting and streaming ecosystem. Business generates revenue from 3 streams:

1. Cloud Modernization - 20% of Rs. 1,200 cr revenue, enable clients move from physical to digital infra  
2. Streaming Unification or Distribution – 55% revenue, mainly time-based subscription  
3. Monetisation and Marketplace - 25% revenue, billed to clients on cost per impression basis

Recent EBITDA Breakeven

FY25 revenue grew 32% YoY to Rs. 1,163 cr. While reported EBITDA was negative Rs. 30 cr due to ESOP cost, adjusted EBITDA stood at Rs. 23 cr (2% margin). H1FY26 revenue was up 35% YoY to Rs. 705 cr (due to 27% growth from same customers), with adjusted EBITDA at Rs. 58 cr (8% margin). Other income of Rs. 60 cr annually comprises treasury and forex gains (90% business from US and Europe).

ESOP charge was Rs. 42 cr for H1FY26 and Rs. 80 cr in FY25, leading to net loss of Rs. 8 cr in FY25 and Rs.6 cr net profit in H1FY26. ESOP cost will continue in FY27E, keeping profit outlook muted.

In addition, some ESOPs were cancelled and cash settled for Rs. 34 cr in H1FY26, at Rs. 590.82 per share, 63% higher than IPO price, which is an actual loss, unlike the general notional practice.  

Large Investment Commitment

Company has raised Rs. 1,500 cr in primary capital till date, of which Rs. 567 cr is cash and equivalents, as of 30.9.25. Excluding Rs. 90 cr buy-back in Apr 2022, Rs. 850 cr has been invested in the business so far.

Amagi has now committed AWS, to spend Rs. 2,418 cr over 6 years beginning May 2025 till April 2031. Part of this (Rs. 550 cr) will be funded via fresh issue proceeds. But even then, this is a substantial commitment of nearly Rs. 400 cr per annum for the ‘asset-light’ business.

Is Lower Valuation from last funding round Attractive Enough?

PE General Atlantic invested Rs. 880 cr for 9% stake Amagi in Nov 2022, at about Rs. 514 per share, probably in the covid-world pricing frenzy. Obviously, it is not exiting the investment at 30% loss. Promoters too are not offering shares in the OFS but will see their 17% holding dilute to 15% post IPO. 

Coming on to Amagi’s IPO pricing:

In a best-case scenario, FY27E EBITDA margin is assumed to expand to 15% next year, leading to an estimated EBITDA of ~Rs. 280 cr. Amagi’s mcap is Rs. 7,800 cr and enterprise value of Rs. 7,250 cr discounts this by an EV/EBITDA multiple of ~26x, on one-year forward basis. While there are no direct peers, global comparables like PubMatic and The Trade Desk are ruling between 22-26x EBITDA multiple for much higher EBITDA margin of 20-25% and double-digit topline growth. Thus, Amagi’s recent single digit EBITDA margin is not attractive enough for its IPO pricing.