PVRINOXNSEFebruary 06, 2025

PVR INOX Limited

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11analyst exchanges

7executives

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Management on call

Mr. Ajay Bijli

MANAGING DIRECTOR, PVR INOX LIMITED

Sanjeev Kumar

EXECUTIVE DIRECTOR, PVR INOX LIMITED

Gaurav Sharma

CHIEF FINANCIAL OFFICER, PVR INOX LIMITED

Gautam Dutta

CHIEF EXECUTIVE OFFICER,

Pramod Arora

CHIEF EXECUTIVE OFFICER,

Harsh Shah

AXIS CAPITAL LIMITED

Ajay Bijli

Managing Director; Mr.

Key numbers — 40 extracted

Rs. 281

ockbuster releases. This strong performance led to the highest quarterly ATP and the SPH reaching Rs. 281 and Rs. 140, respectively. While ad revenues touched Rs. 149 crores, highest since the pandemic. P

Rs. 140,

leases. This strong performance led to the highest quarterly ATP and the SPH reaching Rs. 281 and Rs. 140, respectively. While ad revenues touched Rs. 149 crores, highest since the pandemic. Pushpa 2 emerg

Rs. 149 crore

t quarterly ATP and the SPH reaching Rs. 281 and Rs. 140, respectively. While ad revenues touched Rs. 149 crores, highest since the pandemic. Pushpa 2 emerged as the biggest blockbuster in Indian cinema histor

36%

ndemic. Pushpa 2 emerged as the biggest blockbuster in Indian cinema history, contributing nearly 36% to the quarter three India box office and 12% to the 2024 India box office. Q3 started with Tam

12%

uster in Indian cinema history, contributing nearly 36% to the quarter three India box office and 12% to the 2024 India box office. Q3 started with Tamil and Telugu cinema leading the way. Devara P

rs,

at the box office. November saw resurgence of Hindi cinema with two Diwali blockbusters, Singham Again and Bhool Bhulaiyaa 3, each grossing about Rs. 300 crores at the box office. Regiona

Rs. 300 crore

ndi cinema with two Diwali blockbusters, Singham Again and Bhool Bhulaiyaa 3, each grossing about Rs. 300 crores at the box office. Regional films continued the momentum with Amaran grossing over Rs. 250 crore

Rs. 250 crore

Rs. 300 crores at the box office. Regional films continued the momentum with Amaran grossing over Rs. 250 crores to become the second highest grossing Tamil movie of the year. Lucky Bhaskar, a mid-budget Telug

Rs. 90 crore

haskar, a mid-budget Telugu movie, achieved impressive box office success, grossing approximately Rs. 90 crores. December was the biggest month of the year which saw the release of Pushpa 2, which shattered

Rs. 1,450 crore

iggest month of the year which saw the release of Pushpa 2, which shattered records grossing over Rs. 1,450 crores in India. Its dubbed Hindi version achieved Rs. 900 plus crores, setting a new record as the hig

Rs. 900

hich shattered records grossing over Rs. 1,450 crores in India. Its dubbed Hindi version achieved Rs. 900 plus crores, setting a new record as the highest grossing Hindi film of all time. Hollywood also f

Rs. 100 crore

ccess in Mufasa: The Lion King, which resonated with the urban family audience and collected over Rs. 100 crores at Indian box office. While Q3 witnessed significant highs, the postponement of key films like S

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Guidance — 20 items

Harsh Shah

opening

“PVR INOX Management will be represented by Mr.”

Ajay Bijli

“But when I look at the next year’s pipeline and I look at the way people are watching re-releases.”

Ajay Bijli

“So, I see consumption pattern only improving going forward.”

Ajay Bijli

“Because, if you have healthy cash flows a lot of, it only so much can be spent on renovations and new properties rest all will be utilized to pay down the debt.”

Gaurav Sharma

“So, going forward, I think we will continue to see a reduction in our net debt levels.”

Kavish Parekh

“So, what levels do we plan to exercise to ensure sustained growth in the F&B business?”

Kavish Parekh

“My understanding is this will be across all revenues, ticketing, F&B as well as ad revenues, is that right?”

Kavish Parekh

“So, I understand the CAPEX with 40% to 80% will be borne by developers, but how does this play out in terms of revenue sharing?”

Gaurav Sharma

“Again, these conversations will be dependent on location, market, developers.”

Gaurav Sharma

“In certain locations, the preference will be with asset-light or management contract models.”

Risks & concerns — 7 flagged

In terms of the “Financial Results” for the quarter: The following numbers are calculated after adjusting for the impact of Ind-AS 116 on lease accounting.

— Ajay Bijli

After a weak 2024, Hollywood seems ready for a strong comeback in 2025.

— Ajay Bijli

So, we have seen this quarter and maybe previous quarter also lot of the FMCG and even discretionary categories call out slowdown in urban of course yours is an essentially urban consumption.

— Abneesh Roy

But would you be worried in the near term because of the urban slowdown?

— Abneesh Roy

But what from here on, considering the weak trends as we go into 4Q?

— Kavish Parekh

So, it will be very difficult or extremely impossible to suggest that, that which will be the preferred model, that is one.

— Pramod Arora

So, I just wanted some guidance on the CAPEX for next year and that you would have a visibility right now given some risk fit outs, already?

— Umang Mehta

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Q&A — 11 exchanges

Yes. Thanks. My first question is on the overall consumption impact on your business. So, we have seen this quarter and maybe previous quarter also lot of the FMCG and even discretionary categories call out slowdown in urban of course yours is an essentially urban consumption. So, how do you see in the near term this impact? I do understand Q4 because exam season anyway pipeline every year is a bit less. But would you be worried in the near term because of the urban slowdown? And on the flip side, because of the budget, the taxes have been reduced and substantially also. So, in the in the past

Ajay Bijli

Abneesh, when I look at the content pipeline of this year, which has got impacted because none of the big superstars released any movies this year like Shah Rukh or Aamir or Hrithik or Ranbir and even Ranveer was in an ensemble movie. So, I think this year in fact, the content pipeline of Hindi was subdued. Then we had, Hollywood had a strike and therefore, only the third quarter we found some momentum with Mufasa, Gladiator II and movies coming. But when I look at the next year’s pipeline and I look at the way people are watching re-releases. In fact, some of the re-releases like Yeh Jawaani

Hi, team. Thanks for the opportunity. Firstly, I want to get a sense on synergies, the numbers that we had laid out at the time for our merger. Where are we now? From here on what levers do we have to improve the cost structure or margin trajectory? Especially, if occupancy stays where it is? And secondly, what is the update on our deleveraging plans, we had set out plans to generate proceeds of about three, 3.5 billion from sale of some of our properties. Where do things stand as we speak? So, of course, debt reduction this quarter was commendable. But what from here on, considering the weak

Ajay Bijli

Gaurav, would you like to answer the question please? Sure, sure. On your first part of the question regarding synergies, I think to a large extent we have already implemented steps for integration over the course of last two years. And the cost structure also reflects, if you look at it over the course of last 4.5 years and compare on a per screen basis our fixed cost has been stagnant. Even for the nine-month period ending December’24, our overall fixed cost has been at a flat level, despite of the cost inflation. The cost structure is already reflecting, a bulk of the merger synergies, I th

Yes, good evening, Arun Prasath from Avendus Spark here. Thanks for the opportunity. So, continuing the discussion on the asset-light model, can you just throw some light on how does this framework work from our perspective? I mean, if you are opening say 100 screens. What you will do it for the, what you opt for FOCO model and what you will opt for the asset-light model? And which one will you be completely putting 100% of your CAPEX? Or is it left to the, option is left to the developer, or do we have some say in this? So, can you just help us understanding this, this framework? How do we di

Gaurav Sharma

Sure, Arun. I think as explained by Pramod earlier, the strategy is to leverage the brand now and the market presence and scale to drive growth towards more capital efficient screen openings. I think we will continue to have these, all the three models working in the market. Lease model will be there. Again, these conversations will be dependent on location, market, developers. In, in, in certain locations, we would prefer to go with these model. In certain locations, the preference will be with asset-light or management contract models. We have also mentioned that, majority of new screen open

Thank you for taking my question. I just needed a small clarification on our screen additions. At the end of FY ‘24, we had reported that our screen count stood at 1,748 screen and currently we are at 1,728 screens, which is a net reduction of 20 screen. But we have also reported that our net screen addition has been 10 screens year-to-date. So, could you please clarify this for us?

Saurabh Pant

Yes, Jensen. Hi, this is Saurabh from the IR team. So, maybe you can connect offline, but the figure that you might be referring to, it might not be as of March ‘24, it might be as on the date of the IR presentation. You can connect with me offline and then maybe I can take you through the number of screens that we have added. But till date we have added about 77 screens and we have closed about 67 screens. By the end of this year, we intend to add another 33 screens that will take the total addition 110. And then there will be an additional probably 5 screens, which will get closed so effecti

Yes. Hi. So, the first question is regarding the SCREENIT initiative that you had launched regarding those rereleases and people being able to book their own shows. So, I just wanted to understand like how has it, how has it since the past? I think it has been one months or two months since then? And how is the shows count per month and what you all expected to go ahead with this?

Gautam Dutta

So, these are early days for screen adds the only one thing that I can share with you that we have currently done close to about 100 odd shows under SCREENIT. These are confirmed screenings that have happened, which is very encouraging. Number two, the idea has really got some virality. A lot of people are talking about it and are inviting their friends and family to join the show that they have created. I think, this idea is going to be quite lethal and is here to stay. However, may not have the potential to really move the needle. So, it will kind of keep picking on 100, 200, 500 shows in a

Yes. Thanks for the opportunity. Sir, what is your target percentage you wish to achieve in box office collection of regional movies? I mean, how much share of box office collection of a regional movie you are targeting from its overall business? Currently, as per the presentation for Bollywood movies, it is around 35% roughly, that is our share. And for the region it is around 12%, 13%. So, now as we have good penetration in the Southern market, so what is your target I mean? How do you look at this?

Gaurav Sharma

So, I think there is no specific target that we are having our strategy is to penetrate more in South India. South India is a very lucrative market. And today, despite of the highest regional mix that we have in our portfolios towards South the penetration in South is the lowest in terms of multiplex penetration. So, incrementally new screen editions that we do almost 35% to 40% of new screen editions will be in South India. And South India as a market has been doing consistently well across all the four major languages. But I think to answer your question, there is no specific number that we

Hi, thanks for the opportunity. Sir, I want to understand the occupancy part. If I am correct to frame like this, how many blockbuster movies do we need each quarter to get an occupancy rate of 28% to 30%? Or rather, what are the factors that would lead us to the 28% to 30% occupancy rate? You can answer it either way.

Gaurav Sharma

I think the occupancy is linked to supply of films and performance of films, both. Unfortunately, the occupancy in the nine-month period has been trending low partly because there was a drop in the number of films which were released in both Hollywood and from the Hindi film industry. And also, partly because of the absence of big mega blockbusters from the Hindi film industry. So, I think going forward and we have seen months and quarters where the occupancy has been very strong. December was in fact the biggest highest occupancy month for us where the occupancy was upwards of 30%. Again, goi

Hello, sir. Congratulations on a very good set of numbers for the quarter. My question was actually on the Q4 current performance in January. So, how has been the response for the movies? You know, key movies like Emergency, which were launched? And what is the expectation for the current quarter based on the lineup that we have? That is the first question.

Gaurav Sharma

I think quarter four has started off well. January there were four films which were released, which crossed more than Rs. 100 crores and three of them were from South India. South India, in fact January is a big month due to Pongal many big films are released. Game Changer was a big film which was released on 10th of January, which did very well at the box office, followed by a Telugu film. There was a major film which was running in theatres again from Tamil film industry which has done very well Sankranti. And Sky Force from Hindi cinema has done Rs. 120 crores box office, which was released

Hi. Thanks for the opportunity. So, I just wanted some guidance on the CAPEX for next year and that you would have a visibility right now given some risk fit outs, already?

Gaurav Sharma

Yes, I think to answer the question on CAPEX. For the current financial year, we will be sub Rs. 400 crores in terms of our total CAPEX expenditure versus Rs. 625 that we did last financial year. So, there is a 35% deduction in CAPEX. And next year, while we are still in the process of doing our budgets and other planning. But overall, CAPEX spends will be somewhere in the range of Rs. 400 to Rs. 500 crores. We will try to be very, very, careful around our CAPEX expenditure and be capital efficient and at the same time not sacrificing the growth in terms of new screen additions. So, the new ca

Hi, good evening. I have a few short and quick questions. First, can you explain how the economics of the distribution model work? Specifically for movies like Singham Again and Sky Force? How do we ensure we do not make a loss there?

Gaurav Sharma

Yes. We have been in this business for more than 20 years and our strategy is to work with only big production houses with a credible track record. And, so we, our business team has that experience and expertise to assess the track record of the director, producer, the actors. And accordingly, we take a call on which we want to distribute. Singham is a very successful franchise. And normally the way it works is that we, pay in advance to the producer before the release of the film. And once the film is released in the box office, collections are there. We have, it is a commission based. We tak

Thank you all for joining us today. In case you have any incremental questions, you can reach out to the IR team or to Saurabh Pant. And we look forward to your support and keep you updated on the progress on its strategy. Thank you so much.

Management

Speaking time

Gaurav Sharma

Moderator

Pramod Arora

Arun Prasath

Gautam Dutta

Tanay

Ajay Bijli

Vaibhav Mule

Kavish Parekh

Abneesh Roy

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Opening remarks

Harsh Shah

Thank you, Seema. Good afternoon, everyone, and welcome to PVR INOX Limited Q3 and nine months FY ‘25 Post-Results Earnings Call. The call will start with brief management remarks on the earnings performance, followed by an interactive Q&A session. PVR INOX Management will be represented by Mr. Ajay Bijli – Managing Director; Mr. Sanjeev Kumar – Executive Director; Mr. Gaurav Sharma – Chief Financial Officer; and other Senior Management Personnel. Over to Mr. Ajay for your “Initial Comments”.

Ajay Bijli

Yes. Thanks. Good afternoon. I would like to invite you all to discuss the Unaudited Results for the Quarter and the Nine Months ending December 31st, 2024. We have uploaded the “Earnings Presentation” and the “Results” on our Company’s Website and the Stock Exchanges website earlier today. And I hope you have had a chance to review them. Our Q3 recorded the highest box office collections of this fiscal year, driven by multiple blockbuster releases. This strong performance led to the highest quarterly ATP and the SPH reaching Rs. 281 and Rs. 140, respectively. While ad revenues touched Rs. 149 crores, highest since the pandemic. Pushpa 2 emerged as the biggest blockbuster in Indian cinema history, contributing nearly 36% to the quarter three India box office and 12% to the 2024 India box office. Q3 started with Tamil and Telugu cinema leading the way. Devara Part-1 starring Junior NTR and Vettaiyan starring Rajnikanth dominated the box office in October, collectively, accounting for ne

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