MUMBAI: SPA Securities has recommended investors to ‘subscribe’ to initial public offering of DQ Entertainment. The company has entered the primary market with public issue of 16048011 shares and fixed the price band at Rs 75-80. The issue closes Wednesday.

“At the upper band of Rs 80, the stock is available at a P/E multiple of 31.2x based on its annualised FY10 earnings of Rs 2.6/share. P/E multiple of 31.2x, however expensive, is still cheaper as compared to its peers P/E multiple of 108.5-144.3x. Given DQE’s low risk business model, larger size compared to its peers and diversified client base, we recommend ‘Subscribe’ to the issue,” the report said.

DQ Entertainment is one of the producers in animation, game art and entertainment content, in Indian as well as global media industry. DQE has forayed in production and distribution of live action television and feature films and also creates game art for mobile, online portals and next generation consoles. The company has 10 production facilities in India and worldwide third party sales representatives.