Broker’s call: PVR Inox (Buy)

Table of Content


Target: ₹1,610

CMP: ₹915.70

Karnataka government has proposed an ₹200 price-cap for movie tickets. This is not the first time. Previous attempt (2017) offers two precedents. One, special format screens – where PVR-Inox’s tickets are dearer – were exempt. Two, it could face legal hurdles.

Prior court rulings – High Courts as well as Supreme Court – have struck down price regulation orders. Even if enforced, the impact will be miniscule. Assuming ATP (₹252 gross ATP) and occupancy levels (24 per cent) for the balance screens to be same as company average, the full year revenue impact of price-cap would be ₹19.20 crore or 0.28 per cent of revenues . Box office collection in Q4 (₹2,000 crore in January/February), on the other hand, is looking up. That, along with a healthy pipeline, far outweighs price-cap fears.

As we noted in Wrong Causality, recent correction was likely technical, which is behind. In fact, tailwinds are now emerging. Return of big banner movies, better pipeline of Hollywood/Bollywood movies (where PVR-Inox has higher share) along with higher disposable income (due to income tax relief) should support occupancies. Reasonable valuations – 9x EV/EBITDA (pre IND AS) – limit downside. These are strong arguments to Buy.





Source link

AIMPWA

mmkrishnandasu@gmail.com http://msmenews.sbs

Leave a Reply

Your email address will not be published. Required fields are marked *

Recent News

Trending News

Editor's Picks

Centre sets new five-year target to cut debt to half of GDP; signals robust capital spending, support to states

The Union budget has set a new five-year target to cut the central government’s debt to 50% of gross domestic product, give or take 1%, by 31 March, 2031. The budget, presented by finance minister Nirmala Sitharaman on Saturday, also sought to signal the Narendra Modi administration’s commitment to fiscal prudence and infrastructure creation, including...

ALL INDIA MSMES PROMOTION AND WELFARE ASSOCIATION

Quick Links

Popular Categories

Must Read

AIMPWA © 2025- All Right Reserved. Designed and Developed by  growGX.com