Shemaroo Entertainment and HOOQ, an over-the-top (OTT) video-on-demand platform, has signed a deal with  for access to over 1,000 of the latter's movie titles. HOOQ has recently entered India with its internet TV platform and is building its local content library.

Commenting on the deal, Religare said, ''We believe an improving device and network ecosystem will continue to drive OTT platforms into India who will then need to buy local content. Shemaroo is already seeing 50%+ growth in the new media space, and new platforms such as these will enhance content monetisation opportunities.''

Commenting on the investment rationale, the stock broker said, ''We believe that content owners with scope for IP monetisation remain one of the better plays in the communication supply chain. Shemaroo's new media contribution is already at 17% of the Q1 revenue  of FY16 and we expect the company to deliver 24.5% EPS growth over the next two years. Valuations are reasonable at 12.5x FY16E P/E. We maintain BUY with a Sep'16 TP of Rs 400.''

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