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Shares of PVR Inox Ltd closed flat on Wednesday after declining over 2 per cent intraday as the multiplexrecorded a consolidated net loss of ₹12.1 crore in Q2 FY25 against net profit of ₹166.2 crore in the corresponding quarter last year.
Despite the loss, brokerages are positive as PVR Inox’s Q2 revenue and EBITDA were ahead of street estimates. Global brokerage CLSA has maintained an outperform rating on the stock and has increased the target price to ₹2,450 apiece.
Brokerages bet heavily on upcoming movie releases across genres, especially Bhool Bhulaiyaa 3, Singham Again, Baby John, Pushpa 2, Kanguva, Venom, Gladiator 2, Mufasa: The Lion King, and The Lord of The Rings (2024).
Robust movie pipeline
Analysts of JM Financial gauged that the content line-up for 2H FY25 is promising and added that re-releases are an additional buffer. Maintaining ‘buy’ rating on PVR Inox at a revised target price of ₹1,980 from ₹2,040, the brokerage said, “Shift towards asset-light/FOCO (Franchise owned, company operated) model promise to reduce capex intensity, thus improving return profile.”
In addition, Nuvama Institutional Equities affirmed that the box office collections in November and December are likely to be strong given the Bollywood pipeline. The brokerage — maintained its buy call — decreased the target price from ₹2,035 to ₹1,935 apiece. It forecasts EPS expansion of 8 per cent each in FY26E and FY27E.
Occupancy
ICICI Securities mentioned that the occupancy reverted close to 26 per cent in Q2 FY25 despite a very weak content pipeline and recalled that the company’s management attributed lower number of movie releases as the only hindrance to occupancy. The brokerage has reiterated a ‘buy’ call at a target price of ₹2,250.
Elara Securities has maintained annual occupancy estimate of 26 per cent in FY25E, which may improve 200bps y-o-y to 28 per cent in FY26E, aided by multiple large franchise-based films in the Hindi genre and English film releases scripting a revival.
“We believe merger synergies have largely been assimilated. But ad revenue per screen could revive next year due to more consistency in content performance,” Elara said in its report. The brokerage has retained buy rating at an increased target price of ₹1,950 from ₹1,900.
Maintaining buy rating at a target price of ₹1,850, Emkay Global mentioned that the management is optimistic on producers churning out more movies, which should aid occupancies. “On the cost front, the management is taking multiple steps to improve profitability, though most of these should bear fruit over the medium term in our view,” the brokerage added.
On the other hand, Motilal Oswal has retained a neutral stance on PVR Inox at a target price of ₹1,750. The brokerage noted that even a 200-300bp blip in occupancy could derail the company’s screen economics, although the management sounded upbeat about the FY26 content pipeline. “Stable occupancy, healthy recovery in advertising revenues, ramp-up of F&B business through ventures like PVR Café and food courts remain the key growth drivers,” it added.
Shares closed at ₹1,624.95 on the NSE and at ₹1,622.55 on the BSE.
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