PHANTOMFX - Phantom Digital

📊 NSE: PHANTOMFX 🏢 Entertainment / Electronic Media Software 📅 Last Updated: 12/14/2025 10:59

💰 Financial Performance

Revenue Growth by Segment

Consolidated Total Income grew 140.91% YoY to INR 88.29 Cr in H1 FY26, driven by sustained demand across North America, Europe, and APAC. Standalone revenue for the half-year ended September 2025 was INR 84.98 Cr, reflecting a 140.93% YoY increase.

Geographic Revenue Split

Revenue is driven by demand across North America, Europe, and APAC regions. The company operates across eight countries, including India, US, Canada, UK, Dubai, and China, to enable smooth collaboration across time zones.

Profitability Margins

EBITDA margin expanded to 32.42% in H1 FY26, while Profit After Tax (PAT) margin reached 23.43%. Profitability is being unlocked through a unified group structure and the integration of AI-enhanced workflows.

EBITDA Margin

EBITDA margin of 32.42% in H1 FY26, with absolute EBITDA rising 75.39% YoY to INR 28.62 Cr from INR 16.32 Cr in H1 FY25.

Capital Expenditure

Planned CapEx of INR 59.00 Cr for new studios and infrastructure in Chennai, Mumbai, and Hyderabad, with INR 47.01 Cr utilized as of September 30, 2025. An additional INR 6.13 Cr is allocated for the UK subsidiary's expansion.

Credit Rating & Borrowing

Debt to Equity ratio stood at 0.25 times in FY25. Interest paid in H1 FY26 was INR 2.42 Cr compared to INR 4.13 Cr in the previous full year, reflecting active debt management.

⚙️ Operational Drivers

Raw Materials

Creative Talent/Manpower (represents the primary cost of service delivery), AI-enabled software tools, and high-end computing infrastructure.

Import Sources

India (Chennai, Mumbai, Hyderabad), UK, USA, and China (Hangzhou).

Key Suppliers

Not applicable for the service-based VFX industry; however, the company utilizes 'Indian manpower' to serve global clients to optimize profit margins.

Capacity Expansion

Expanding domestic studio infrastructure in Chennai, Mumbai, and Hyderabad (INR 59 Cr project). Internationally, the company established Huantong Digital Technology in China and acquired Milk VFX and Lola Post in Europe.

Raw Material Costs

Manpower costs are the primary driver; the company is strategizing to include more Indian manpower to serve global clients to improve margins. AI integration is also helping optimize resource allocation.

Manufacturing Efficiency

AI-enhanced workflows allow the studio to deliver more work in shorter time frames and optimize resource allocation, improving margins without compromising creativity.

Logistics & Distribution

Not applicable for digital VFX delivery.

📈 Strategic Growth

Expected Growth Rate

140.91%

Growth Strategy

Growth is achieved through strategic acquisitions (Milk VFX, Lola Post, Tippett Studio), expansion into high-growth markets like China, and the adoption of AI-enabled workflows to increase scalability and agility.

Products & Services

End-to-end Visual Effects (VFX) for films, web series, and commercials; 3D animation; gaming content; and 3D ride animations.

Brand Portfolio

Phantom Media Group (Umbrella), PhantomFX, Tippett Studio, Milk VFX, Lola Post, Spectre Post.

New Products/Services

Exploring gaming, 3D ride animations, and original IP creation to diversify the portfolio beyond traditional VFX.

Market Expansion

Established Hangzhou Huantong Digital Technology in China; expanded European footprint across UK, Ireland, France, and Spain through acquisitions.

Market Share & Ranking

Positioned as one of India's most trusted and recognizable VFX providers with a growing global footprint.

Strategic Alliances

Acquisition of 100% equity in Milk Visual Effects Limited and Lola Post; partial ownership of Tippett Studio.

🌍 External Factors

Industry Trends

The VFX industry is shifting toward AI integration, which is now commercially impactful. The adoption curve is accelerating, and Phantom is positioning itself as a creative technology organization.

Competitive Landscape

Competes with global VFX houses; differentiates through agility, scalability, and tax-efficient project structuring in the UK and Europe.

Competitive Moat

Durable advantages include Oscar, BAFTA, and Emmy-winning talent, TPN certification, and a unified global pipeline that enables 24/7 production across time zones.

Macro Economic Sensitivity

Sensitive to global entertainment spending and OTT platform budgets (Netflix, Disney+).

Consumer Behavior

Increasing demand for high-end genres like sci-fi, fantasy, and period dramas in the OTT and film sectors.

Geopolitical Risks

Trade barriers or changes in international co-production subsidies could impact the financial efficiency of global projects.

⚖️ Regulatory & Governance

Industry Regulations

Certified Trusted Partner Network (TPN) member, requiring strict adherence to content security and quality standards.

Taxation Policy Impact

Unlocks UK Film & TV Tax Relief and European co-production subsidies, which are critical for global competitiveness and financial efficiency.

Legal Contingencies

Auditor flagged scope for improvement in internal control functions relating to customer/vendor acceptance and credit evaluation, though no specific court case values were disclosed.