Manmohan Shetty-owned Adlabs Entertainment’s IPO on the BSE is amazingly expensive, even by the standards of the Media and Entertainment industry, where good stocks do tend to quote at a premium.

Consider this:

• The Indian theme park operator has just an 18 month operating history
• Still making cash losses. In Apr-Sep’14, it reported a cash loss of Rs 50 crore. This is about 70pc of revenue
• No debt rating after Jan’14
• Probably needs to double revenue just to break even. Its ticket price is already more than 2x of other game parks. May find it hard to raise ticket prices too much. High ticket prices could limit foot falls too.
• Hard to see double digit ROCE.

It is asking for EV/Sales of over 20x. The issue’s last date is tomorrow. Let's see if it closes. The retail portion seems to be subscribed.