Analysts are bullish on UFO Moviez, which IDBI Capital claims, has significant opportunity upwards, given its strong earnings growth as well as improving earnings ratios. UFO Moviez is India’s largest digital cinema distribution network with a screen network of approximately 6636 worldwide, including 4940 screens in India. It currently has a 54% screen market share in India. 

Last year the company created a pan-India, in-cinema advertising platform with long-term advertising rights. This was focused on ad growth for single screens. The ad revenue stream grew nearly 12x from Rs 9.7 crore to Rs. 116.7 crore over five years, thanks to growth in ad minutes.

Analysts expect advertising to continue growing strongly through the FY18 quarters. The time of ad per show in single screens still lags behind the average ad minutes in multiplexes, which are nearly 4.5x that of single screens. As the ad minutes in UFO single screens begin to increase, analysts expect it to have a multiplier effect on revenues. The UFO Moviez management expects a revenue potential of Rs. 1000 crore from the segment, over the long term, although it hasn't clearly defined the time period over which it will see big jumps. To read the latest analyst report click here.