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Multiplexes: Box office witnesses first sign of recovery; H2FY25 pipeline to be strong

ICICIdirect Research 16 Aug 2024 DISCLAIMER
  • The box office saw a first sign of recovery with Stree 2 witnessing a massive 54 crore opening. We highlight that Q2FY25 collections will be boosted by Kalki (spill over), Deadpool and Wolverine (₹ 100 crore+), Stree 2. Furthermore, the other big films release includes Emergency and Devara Part 1.
  • Thereafter, Q3 will have big line up including Pushpa 2, Joker 2, Singham Again, Gladiator 2, Bhool Bhulaiya 3. Chaava, Lord of the Rings, Mufasa the Lion King etc. We expect H2CY24 to be meaningfully better for movie exhibition business amid festive boost with no major events such as Elections, Sports, etc which also impacted release pipeline.
  • On the company front, PVR management stated that are in advanced negotiations to monetise two of their non-core assets with likely inflow of ~₹ 300-350 crore in FY25 and the proceeds from these sales will be used to deleverage the balance sheet
  • We believe that that with strong content pipeline, a sharp recovery will be seen ahead. PVR Inox remain a proxy play on urban/semi urban discretionary spends. We are constructive and have a target price of ₹ 1700/share.
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