Multiplex chain PVR INOX has seen strong box office collections over the past weekend as the new releases continue the momentum in earnings seen post the release of Barbie and Oppenheimer. The Barbenheimer effect had swept the Indian box office when both Hollywood projects were released last month. The movies collectively did business of around Rs 170-180 crore in their run.
Over the last few days, footfalls at PVR INOX saw a substantial increase due to audience interest in recent Bollywood releases. Gadar 2, Rocky Aur Rani Ki Prem Kahani, and OMG 2 are some of the movies attracting audiences to movie theatres. In a statement, PVR Inox said, “The weekend of 11-13th Aug’23 was also the biggest weekend ever in the company’s history. We welcomed 33.6 lakh guests at our cinemas and earned gross box office revenue of ~100+ crores during the weekend.”
As per available data, Gadar 2, OMG 2, and Rocky Aur Rani ki Prem Kahani earned around Rs 230 crore, Rs 74 crore, and Rs 137 crore, respectively. The strong performance of Hollywood and Bollywood movies in the ongoing quarter has raised the expectation of things turning out in favour of the country’s biggest multiplex chain after multiple quarters of struggle to increase the occupancy rate.
Indian Theatres Past Struggle
According to data provided by analysts at Anand Rathi Shares and Stoc Brokers, the share of PVR Inox in box office collections of Bollywood is 40-50 per cent. For regional and Hollywood movies, the number is 10 and 60 per cent respectively.
Indian theatres were hit hard due to the Covid-19 disruption. Analysts opine that due to the shift in behaviour of the audience post-pandemic, the importance of content and word of mouth has increased substantially. The option of watching movies and shows on OTT has affected the decision-making of people, they add.
Looking at the occupancy rate data of PVR Inox compiled by brokerage firm Prabudas Lilladher, the numbers have posted sluggish growth in the last few quarters. In Q1 FY24 and Q4 FY23, the occupancy rate was around 22 per cent. In the last financial year before Covid-19, the rate hovered around 33 per cent.
Only in Q1 FY23 in the post-covid 19 era, the occupancy rate crossed the 30 per cent mark owing to the bumper earnings of KGF 2 and RRR. While multiplexes started the previous financial year on a strong note, the momentum fizzled out as movies failed to live up to expectations. From Rs 1,102 crore in the first quarter of FY23, the net box office collections declined to Rs 900 crore in the last quarter leading to worries about sluggish growth in footfall.
However, after several quarters of subpar growth in occupancy rate, the strong pipeline of movies in the current quarter could finally lead to an uptick in the number.
PVR INOX Strong Performance
Given its strong position in the market, the performance of recent movies is expected to give a boost to PVR INOX’s numbers in this quarter. Shobit Singhal, Research Analyst at Anand Rathi Shares and Stock Brokers, says that Q2 is expected to be a bumper quarter for PVR INOX. “Occupancy, which has been around 20-22 per cent for some time now, is expected to cross 30 per cent. Both footfalls and occupancy are expected to post good gains. Looking at the pipeline of movies, this quarter is looking good for the multiplex chain,” Singhal says.
Mission Impossible 7, Barbenheimer, Rocky Aur Rani Ki Prem Kahani, Gadar 2, OMG 2 and Jailer are some of the high-profile movies which were released in this quarter. With the upcoming releases of Ayushmann Khuranna’s Dream Girl 2 and Shah Rukh Khan’s Jawaan, analysts say that the current quarter is expected to be on par with the strong performance seen in Q1 FY23.
Commenting on the Q2 box office performance so far, Jinesh Joshi, Research Analyst at Prabhudas Lilladher Pvt Ltd, says, “The best performance in the post Covid-19 era has been seen in the first quarter of last financial year due to the bumper business of RRR and KGF. It remains to be seen how the numbers for PVR INOX come out in this quarter but due to the pipeline being strong, with several movies performing well, the signs are positive for the chain.”
Investors in the stock market have also expressed confidence in the past month. The scrip has surged by around 20 per cent in this period, owing to the expectation of good performance in the current quarter due to high box office collections.
