PVR INOX expands beyond metros with 'Smart Cinemas' 

PVR INOX is sharpening its focus on India's smaller cities with the launch of PVR INOX Smart Cinemas, a new exhibition format aimed at Tier III and Tier IV markets where organised multiplex infrastructure remains limited despite rising consumer spending and retail development.

Unlike premium formats in metros, the new properties have been designed with a sharper focus on affordability. While the auditoriums will continue to offer 2K laser projection, 7.1 surround sound, and modern seating, pricing will be tailored to local market conditions.

"We don't have one pricing strategy for every city. We study every market individually," Sanjeev Kumar Bijli executive director, PVR INOX, told Fortune India. "On average, ticket prices will be about 20-25% lower than those in the nearest larger city. Compared with existing local cinema operators, prices may be around 10-15% higher, but the idea is to deliver a better experience without making it unaffordable."

The company will open its first Smart Cinema in Muzaffarpur, Bihar, through a Franchise-Owned, Company-Operated (FOCO) model, under which local developers will own the properties while PVR INOX oversees operations. Six more Smart Cinema properties have already been signed and are expected to open over the next nine months in Barrackpore, Rampur, Hanumangarh, Ponda, and Ghaziabad.

PVR INOX currently operates 1,782 screens across 355 properties in 113 cities across India and Sri Lanka.

The Smart Cinema rollout also fits into PVR INOX's broader capital-light expansion strategy. The company has previously said it plans to transition entirely to the FOCO model over the next four years, allowing developers to fund infrastructure while PVR INOX focusses on operations. The approach is aimed at improving capital efficiency while accelerating expansion into underserved markets.

The launch reflects a broader shift in the company's expansion strategy as it looks beyond metropolitan markets, while maintaining that growth opportunities in larger cities remain intact.

"Metro and Tier-I cities are not saturated. We are continuing to open cinemas there, especially in South India. But at the same time, we realised there was a significant opportunity in Tier-III cities where there are either no cinemas or no quality cinema experience," Sanjeev Kumar Bijli told Fortune India.

According to him, the decision followed detailed market research conducted over the last 15 years, insights from the company's film distribution business, and growing interest from developers in emerging retail hubs. "For years, through our distribution business, we have known there are towns where films cannot be released because there are no suitable theatres. We also started receiving requests from consumers asking why they didn't have a PVR INOX in their city. At the same time, developers building malls in these markets approached us because they see a multiplex as an anchor that drives footfalls," he said.

Managing director Ajay Bijli said India's cinema exhibition industry remains structurally underpenetrated, leaving ample room for expansion. "India has around seven screens per million people, compared with nearly 100 in the U.S. and over 40 in China. Our initial phase of growth focused on larger cities. The next phase lies in these high-growth markets, where consumer aspirations are rising but access to modern cinema infrastructure is still limited," he said during a panel discussion.

PVR INOX has identified nearly 300 cities as part of its long-term expansion opportunity, with Smart Cinemas expected to become the primary format for entering markets where organised retail is expanding but multiplex penetration remains low.

The company believes economic growth is increasingly spreading beyond the country's largest urban centres, supported by organised retail, infrastructure development, and rising disposable incomes. Smart Cinemas are intended to cater to these markets with a standardised cinema experience while keeping operating costs lower than traditional multiplex formats.

Ticket prices at Smart Cinemas are expected to be in the ₹150-175 range in many markets. Food and beverage prices will also be calibrated for local consumers, made possible in part because developers share the investment burden under the FOCO model. Despite the lower price points, Bijli stressed there would be no compromise on the cinema experience.

The Smart Cinema initiative also builds on the company's increasing reliance on asset-light formats. In FY26, 55% of PVR INOX's new screen additions came through FOCO and other capital-light models, reflecting its strategy of expanding its footprint while reducing capital expenditure.

The company also intends to continue programming a mix of mainstream and independent films across its network. While it remains uncertain how regional audiences in smaller towns will respond to independent cinema, Bijli said PVR INOX has historically experimented with diverse content, from international films to Japanese anime, and will continue testing audience preferences as it expands into new markets.