PVR INOX Ltd. share price target

Low-budget movies continue to perform well, with Bala' garnering ~Rs1bn in collections. Three movies collected >Rs1bn vs. two in QTD Q3FY19. Hollywood movie collections are expected to remain subdued in Q3, due to a lack of big-franchise movie releases....

SPI cinemas Pvt Ltd got merged into PVR Ltd with effect from August 17th, 2019 by allocation of 1.6mn shares for the balance 28.3% stake. F&B; spend per head grew by ~38% YoY while Ad income rose by 16% (YoY). We forecast F&B; to witness good momentum in FY21. SPI cinema posted an average performance while ATP increased (Rs 162 vs Rs 152) due to strong traction from Hollywood movies. PVR to continue paying tax under the regular tax rate (34.94%) till the utilisation of available MAT credit....

PVR reported yet another strong quarter with robust box office performance boosting the topline and bottomline show. Footfalls came in at 29.3 mn, up 25% YoY and much better than our estimate of 20% growth with box office revenues at | 492 crore, up 31.6% (our estimate was 25% growth), The SPH at | 99, grew by 11% YoY, resulting in 38% growth in F&B; revenues. Advertisement revenues grew by 15.6% YoY (ex- SPI, growth at ~8.9%), better than our expectation of overall growth of 12% YoY. EBITDA (without impact of Ind AS116) came in at | 194.4 crore, up 56.8% YoY, and much...

SPI Cinema's amalgamation was approved by NCLT. PVR allotted 1.6mn shares for acquiring the balance 28% stake. ~Rs800mn available as of 30th Sep 2019. This was an excellent quarter for PVR with top-line increasing 37.3% YoY to Rs9,732mn (PLe of Rs8,832mn) buoyed by strong content (4/5movies crossed Rs1bn in box office collections). Ind-AS adjusted EBITDA margin expanded 250bps YoY to 20% and is the best ever margin performance since 1QFY16. Given 1) strong content pipeline 2) leadership position (~28% screen market share) and 3)...

Although growth in south India has been relatively slow, management expects a turnaround in the second half this year, which will likely provide additional support to earnings. We increase our EBITDA estimate by 9%/4% for FY20/21, given the strong second-quarter performance and managements focus on screen addition A multitude of factors including its healthy growth prospects, strong competitive positioning, continuous increase in ATP and bright opportunity to grow ad revenue justify premium valuations. These bode well from the top- and A multitude of factors, including healthy growth prospects, competitive positioning, continuous increase in ATP and a bright opportunity to grow advertisement revenue, justify premium valuations. Also, this could provide additional source of revenue to producers which can lead to investment in better and big Management highlighted a major trend in the industry South Indian movies dubbed in Hindi are performing exceptionally well.

Q1FY20 revenue grew by ~27% on a YoY basis owing to better box office and F&B; collections while Average Ticket Prices (ATP) witnessed a de-growth of ~6.5% YoY . Adoption of IND AS 116 for leases has brought immediate impact on key figures and ratios which will get normalised in coming years. F&B; spend per head grew by ~8% YoY while Ad income rose by 28% (YoY). We forecast F&B; to grow at ~11% for FY20&21. SPI cinema posted a decent 8% QoQ growth compared to a weak...

PVRL's Q1FY20 result (Adj. for AS-116 impact) was in-line with our forecast with a slight beat on consolidated EBITDA margin front, which was driven by the beat in the Movie distribution segment. Standalone exhibition revenue grew by 10.6% YoY and Adj. EBITDA margin declined by 215bps to 17.1%, in-line with our forecast. PVRL has added 36 screens YTD and has maintained its FY20 target of addition of 80+ screens (100+ currently under fit-outs) despite the slowdown in real estate market in general. PVRL expects Q2/Q3FY20 to be better than Q1 given the healthy movie slate. We largely maintain our FY20/21 forecast. We also maintain ACCUMULATE with TP of...

PVR's Q1FY20 topline beat was aided by better-than-expected growth in F&B; and advertisement. F&B; revenues at | 260.4 crore, up 28.4% YoY, were higher than expected 15% growth led by SPH growth of 17% YoY. Advertisement revenues grew 28% YoY, better than our expectation of 25% YoY. EBITDA (without impact of Ind-AS116) came in at | 158.7 crore, with margins of 18%, largely in line with our estimates. On a reported basis, EBITDA was at | 279 crore. Margins of 31.6% as rent are now charged under depreciation and interest under Ind-AS 116. PAT (without impact of IndAs116) came in at | 44 crore, a tad better than our expectation of | 39.9...

69% YoY, unlike peers which faced limited impact, as the company has longer 15-year leases with higher liability and interest charge. Concall highlights: (1) Net debt stood at INR13b. Capex guidance at INR5b for FY20 with 80+ screen adds. Currently, 100+ screens are in fit-out stage; expects to reach 1,000 screens over the next two years. (2) PVR expects to...

Q4FY19 revenue grew at a rate of ~28% on a YoY basis owing to higher box office and F&B; collections while Average Ticket Prices (ATP) witnessed a growth of 3.8% YoY . Food & Beverages spend per head de-grew by ~2% YoY while Ad...