Piramal invests Rs150 crore in Smaaash Entertainment

Smaaash, which has five gaming arcades, will use the funds to enter new markets in India and abroad

Smaaash Entertainment founder Shripal Morakhia. The sports-based entertainment company is planning to set up centres in the US and the Middle East. Photo: OnlyPix
Smaaash Entertainment founder Shripal Morakhia. The sports-based entertainment company is planning to set up centres in the US and the Middle East. Photo: OnlyPix

Mumbai: Piramal Enterprises Ltd’s structured investment group (SIG) unit has agreed to invest Rs.150 crore in Smaaash Entertainment Pvt. Ltd, a sports-based entertainment company co-owned by cricketer Sachin Tendulkar, two people aware of the development said.

Currently, Smaaash has five gaming arcades in Mumbai, Bengaluru, Gurgaon, Noida and Hyderabad. The company is known for its arcades that feature sports such as cricket, football, paintball, go-karting and a host of virtual games.

Smaaash was started by Shripal Morakhia in 2012 with its first centre of over 40,000 sq. ft in Mumbai. Morakhia was also founder of brokerage firm Sharekhan.

“Smaaash had been in talks with several investors for a few months now. They have closed the transaction with Piramal SIG a few days ago. The company will use the funds for expanding into newer cities in India as well as for its overseas expansion,” said one of the two people cited above, requesting anonymity as he is not authorized to speak to the media.

On the international business side, Smaaash is setting up centres in the US and in the Middle East, he added. “In the Middle East, the company is targeting the cities of Dubai and Jeddah,” he said.

In India, Smaaash is opening centres in Ludhiana and Chandigarh, and two more in Delhi, The Economic Times reported in May. It is also expanding its Mumbai flagship centre to 300,000 sq. ft from 120,000 sq. ft, the report added.

In 2014, Smaaash had raised Rs.65 crore from sports-focused investment firm FidelisWorld, which invested through its first fund FW Sports Investment Fund L.P. Other investments made by FidelisWorld include Chennai-based Technology Frontiers India Pvt. Ltd, a global provider of in-stadia activation solutions for the sports, media and entertainment industries.

According to the company’s filings with the registrar of companies (RoC), FidelisWorld held a 39% stake in Smaaash, as of 31 March 2015. According to a Dealcurry.com report, Tendulkar bought around 18% stake in the company in 2013.

Smaaash reported a revenue of Rs.58.41 crore in 2015-16, compared with Rs.44.6 crore in the previous year, according to data from RoC. The company reported a loss of Rs.24.7 crore in the year 2015-16, as against a loss of Rs.18.2 crore in the previous year, data show.

Emails sent on Friday to Smaaash and FidelisWorld went unanswered.

“We would not like to comment on market speculation,” said Piramal Enterprises in an email response.

For the Piramal SIG group, it would be the first investment outside of its traditional investment areas of infrastructure and cement.

“The Piramal SIG group started out with investing (in) infra and cement, but now, they are looking to be sector-agnostic and are looking at several sectors beyond infrastructure,” said the second person cited above, also requesting anonymity.

On 15 August, Mint reported that Piramal’s SIG unit is in advanced talks to invest Rs.800 crore (approximately $120 million) in solar power producer ACME Solar, which would be its second investment in the renewable energy sector this year.

In March, Mint reported that Piramal Enterprises and Dutch pension fund asset manager APG Asset Management were jointly investing $132 million (Rs.900 crore) in Essel Infrastructure Ltd’s solar platform across India.

The other investments by Piramal’s SIG division include Rs.615.5 crore in two cement firms and buying non-convertible debentures (NCDs) of Sanghi Industries Ltd, the flagship company of the Ravi Sanghi Group, worth Rs.265.50 crore, Mint reported on 21 April.

The division has also invested Rs.350 crore in NCL Industries Ltd, the owner of the Nagarjuna Cement brand; Rs.500 crore in Green Infra, an alternative energy company; and Rs.425 crore in Navayuga Roads, according to the company’s website.

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