Simca Advertising files DRHP for SME IPO,  bets on digital screens and OOH growth

Mumbai-based outdoor advertising company Simca Advertising Ltd has filed its draft red herring prospectus (DRHP) with the Securities and Exchange Board of India (SEBI) to raise funds through an initial public offering on the SME platform of the National Stock Exchange, with proceeds earmarked for digital screen expansion, a strategic monetisation partnership and working capital requirements.

The proposed IPO comprises a fresh issue of up to 31.72 lakh equity shares of face value ₹10 each, with no offer-for-sale component, implying the entire proceeds will accrue to the company. The shares are proposed to be listed on NSE Emerge.

Socradamus Capital Pvt Ltd is the book-running lead manager to the issue, while MUFG Intime India Pvt Ltd is the registrar.

The issue comes as the Mumbai-based company seeks to scale its presence in the out-of-home (OOH) advertising segment and deepen its play in digital out-of-home inventory, while leveraging a three-year period of sharp revenue and profit growth.

Working capital largest use of proceeds

A significant portion of the issue proceeds — ₹23.5 crore — has been earmarked for incremental working capital requirements, making it the largest allocation from the IPO. The company plans to deploy ₹12 crore in FY26 and ₹11.5 crore in FY27 toward working capital needs.

Besides this, ₹12.72 crore will be used for purchase and installation of LED screens across seven locations in Mumbai, while ₹5 crore has been allocated toward a strategic collaboration with Capital World Media Services Pvt Ltd (CWM) for monetisation of 20 LED digital advertising screens. The balance will be used for general corporate purposes.

The company said the working capital requirement has grown in line with expansion in operations, particularly due to higher trade receivables and increased scale of business. Trade receivables stood at ₹14.74 crore as of March 31, 2025, compared with ₹12.56 crore in FY24 and ₹4.32 crore in FY23.

Financial growth over three years

Simca Advertising, incorporated in June 2022, has reported strong financial growth over the past three fiscals.

Revenue from operations rose from ₹11.96 crore in FY23 to ₹49.31 crore in FY24, before increasing further to ₹74.94 crore in FY25.

Net profit after tax grew from ₹1.57 crore in FY23 to ₹5.78 crore in FY24 and ₹9.98 crore in FY25, while profit before tax stood at ₹13.49 crore in FY25.

The company said the growth was supported by expansion across sectors such as real estate, banking, insurance, fashion and lifestyle, as well as deeper engagement with advertising agencies and government clients.

Two large contracts contributed materially to FY25 revenue, including a major real estate mandate contributing 12.86% of revenue and a government contract contributing 6.67%.

Maharashtra remained the company’s largest market, accounting for 88.56% of FY25 revenue at ₹66.37 crore.

Simca said operating leverage improved during the period, with total expenses as a percentage of income declining to 82.04% in FY25 from 84.34% in FY24.

Asset-light OOH model

The company operates an asset-light business model, securing advertising rights primarily through lease and sub-lease arrangements from the promoter’s proprietorship firm, M/s Simca Advertising, and third-party site owners, rather than owning most of the media assets.

Its network spans over 100 media assets including hoardings, gantries, transit media, kiosks and digital billboards across Mumbai and other parts of Maharashtra.

Campaign revenues are generated through confirmed purchase orders, while large corporate clients and agencies are typically extended credit periods of 100 to 120 days.

The company also facilitates third-party transactions involving purchase, sale and leasing of advertising sites.

Digital screen expansion planned

As part of its digital OOH push, Simca plans to deploy LED screens across seven identified Mumbai sites, including Infiniti Mall in Malad, Sea Princess Hotel in Juhu, SGS House in Powai, Marble Market in Vile Parle East, Teli Gali in Andheri East, Chitrakoot Ground in Andheri West and JVPD Scheme in Juhu Circle.

The company expects commercial operations across these sites to commence by December 2025, subject to receipt of IPO proceeds and regulatory approvals.

Simca said the expansion is aimed at tapping the shift in OOH advertising from static to digital formats, where LED screens offer real-time content updates, multi-advertiser inventory and programmatic advertising opportunities.

CWM partnership to expand digital footprint

Another key part of the IPO strategy is Simca’s agreement with Capital World Media Services for co-commercialisation of 20 LED digital screens located at Mega Bus Queue Shelters along Mumbai’s Western Express Highway.

Under the agreement signed in May 2025, Simca will have co-commercialisation rights and a 50% share of net profits for 10 years.

The total consideration is ₹7.5 crore, of which ₹2.5 crore has already been paid from internal accruals, while the remaining ₹5 crore is proposed to be funded from the IPO.

The screens span multiple high-traffic locations across Mumbai, including Bandra, Khar, Goregaon and Borivali.

The company said the partnership allows it to participate in the digital OOH segment through an asset-light structure while generating recurring income from shared monetisation.

Growth strategy

The company’s growth strategy includes diversification into transit branding, airport advertising, cinema OOH and event media, expansion of media rights inventory, adoption of programmatic digital out-of-home systems and data-driven advertising solutions.

It also plans to pursue strategic alliances with event firms, retail chains and agencies, while integrating technologies such as AI-led content optimisation and interactive advertising formats.

On sustainability, the company said it plans to adopt recyclable materials in flex and vinyl production and explore solar-powered systems at select LED locations.

Promoter-led company

Simca is promoted by Fahim Batliwala and Ashma Fahim Batliwala.

Fahim Batliwala, chairman and managing director, holds 99.99% of the pre-issue equity share capital, while Ashma Fahim Batliwala holds 176 shares.

The company said there has been no change in control in the five years preceding the DRHP filing.

With the proposed listing, Simca joins a growing pipeline of SME issuers tapping public markets to fund expansion, even as investors increasingly track profitability, capital deployment and execution in emerging growth companies.