Shares of PVR, the country’s largest movie chain, dropped nearly 5% on the BSE in Thursday's early trading session amid strong volume trade. The stock has witnessed a trend reversal after rising more than 5% in the past three sessions.

PVR share price opened 1.8% lower at ₹1,894.10, against the previous closing price of ₹1,929.45 on the BSE. Extending opening losses, the midcap stock fell as much as 4.6% to hit a low of ₹1,840 on the back of heavy volumes as 60.6 lakh equity shares changed hands at the counter on the BSE against the two-week average volume of 0.46 lakh stocks. The market capitalisation dropped to ₹11,256.3 crore.

PVR shares saw a surge in selling activities amid a report that four investors sold around a 9% stake in the multiplex chain operator via a block deal today. The investors who offloaded their shares in the company are Multiples PE, Grey Birch, Plenty PE, and Berry Invt. The offer price for the block deal was in the range of ₹1,852 to ₹1,929 apiece, while Kotak Securities was the broker for this transaction.

The share price of multiplex major had rallied more than 5% in the last three sessions after the recently released high-budget movie Brahmastra reported growth in its box office collection worldwide. The Ranbir Kapoor-Alia Bhatt starrer movie has crossed the ₹150-crore mark in gross box office collection worldwide in the first five days of its release.

On Friday, PVR and Inox Leisure tumbled 5% after Brahmastra received disappointing reviews from fans and critics. The mixed review of Ayan Mukerji’s directorial, which is reportedly made on a budget of ₹410 crore, had faded the hopes of the box office revival after recent big flops such as Laal Singh Chaddha, Raksha Bandhan, Shamshera, and Dobara.

In a separate development, the Competition Commission of India (CCI) has rejected a complaint against the proposed merger of PVR and INOX Leisure, saying apprehension of likelihood of anti-competitive practices by an entity cannot be a subject of probe.

Recently, the multiplex chain operators PVR and INOX Leisure received nod from the stock exchanges for the proposed scheme of amalgamation. The ‘no objection’ certificate is mandatory for getting approval from the National Company Law Tribunal and other regulatory approval for the proposed deal.

In March this year, PVR and INOX Leisure, the country’s largest multiplex chains, had announced a merger to create a network of over 1,500 screens across 109 cities in India. With PVR currently operating 871 screens across 181 properties in 73 cities and INOX operating 675 screens across 160 properties in 72 cities, the combined entity is likely to become the largest film exhibition company in India operating 1,546 screens across 341 properties across 109 cities.

INOX will merge with PVR in a share swap ratio of three shares of PVR for every 10 shares of INOX, subject to their shareholder's approval, SEBI, and other regulatory nods. The merged entity will be named as PVR INOX Limited with the branding of existing screens to continue as PVR and INOX. New cinemas opened post the merger will be branded as PVR INOX.

The mega-merger was announced in the wake of rising demand for digital over-the-top (OTT) platforms during the pandemic which has badly impacted the film exhibition sector. OTT platforms such Netflix, Amazon's Prime Video, and Disney Hotstar reached their peak during the Covid-19 pandemic in India as Cinema halls, theatres, multiplexes were closed to contain the spread of the virus.

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