PVR INOX shares hit 52-week low as Hindi films underperform

Shares of PVR INOX Ltd, India's largest multiplex chain, hit a 52-week low on Tuesday after the company's fourth-quarter loss widened due to the dismal performance of Hindi films as well as fewer Hollywood movie releases.

The movie exhibitor's stock plunged as much as 4.12% to ₹1,404 apiece on the BSE. At 11:16 am, shares of the multiplex operator were trading 3.04% or 44.45 points lower at ₹1,420. During the session, the company’s market capitalisation fell to ₹13,880 crore. Around 29,400 PVR INOX shares changed hands on the BSE, lower than the two-week average of 0.31 lakh shares. Currently, the share price of PVR INOX is trading 57.5% lower than its 52-week high of ₹2,211.55 which the company hit on August 4 last year.

"The year gone by marks the 1st full year of uninhibited operations for the exhibition industry. There was considerable volatility in box office quarter on quarter. We believe that the 2 major factors that marred the industry in FY’23 – underperformance of Hindi films and less number of Hollywood releases, will both ease out in FY’24," said Ajay Bijli, Managing Director, PVR INOX Ltd.

PVR INOX plans to shut down approximately 50 cinema screens over the next six months. "These properties are loss-making, or housed in malls which have reached the end of their life cycle with little hope of any revival. The company has taken an accelerated charge of the depreciation in its books and written off the WDV of assets," the multiplex chain said in a statement.

In the January-March quarter, the company's total income stood at ₹1,164.9 crore, witnessing a growth of 101.2% as against ₹578.7 crore in the March quarter of FY22. The company’s EBITDA (earnings before income, tax, depreciation and amortisation) surged by 100% at ₹285.6 crore during the quarter under review, as against ₹142.3 crore in the same period last year. The company’s EBITDA margin stood at 24.5% in the March quarter, as against 24.6% in the same period last year.

In FY23, the company added 168 screens, of which PVR added 97 screens whereas INOX added 71 screens. In the March quarter, the company added 79 screens, of which 53 screens were added by PVR, whereas INOX added 26 screens. In FY24, the company plans to open 150-175 more screens.

In January 2023, the National Company Law Tribunal approved the ‘scheme of amalgamation’ between INOX Leisure Limited and PVR Limited. The scheme became effective on February 6, 2023. In the next 12-24 months, the amalgamated entity plans to achieve operational synergies of ₹225 crore. 

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