Rs 280 crore losses in FY25, a 10 percent decline in footfalls and an uneven content supply--- the twists are coming thick and fast for PVR Inox, India's largest multiplex chain that stumbled into red as Hindi and Hollywood film successes were a miss at the box office last financial year.
Fewer people came to watch films last financial year with FY25 reporting 137 million footfalls as against 151 million in FY24 and that resulted in lower revenue and lower EBITDA (Earnings Before Interest, Taxes, Depreciation, and Amortisation), Sanjeev Kumar Bijli, Executive Director, PVR Inox, told Moneycontrol.
Curtains up, audience down
"Fewer people came because of fewer films and very few blockbuster English films. We did not have films like Oppenheimer and Barbie which are important for our chain."
The lingering impact of the 2023-24 Hollywood strike resulted in a 6 percent drop in the number of English releases and there was a 14 percent drop in the number of Bollywood titles.
"Hindi film successes were few and far between. It was not the year of Ranbir (Kapoor), Ranveer (Singh), Shah Rukh Khan. We had Sikandar which did not perform well," Bijli said.
PVR Inox's gross box office collections (GBOC) of Hindi movies declined by 26 percent to Rs 528.1 crore and that of English films dropped by 28 percent to Rs 194.5 crore. The company's overall GBOC declined 9 percent to Rs 3,543.7 crore from Rs 3,912.3 crore in FY24.
The multiplex chain's revenue from the sale of movie tickets dropped 9.9 percent in FY25 to Rs 2,954.9 crore from Rs 3,279.9 crore reported in the previous year.
The first and fourth quarter reported lowest box office business at Rs 711.8 crore and Rs 785.8 crore respectively. The best performing quarter for the multiplex chain was Q3 with Rs 1,047.4 crore business followed by Rs 998.7 crore box office revenue in the second quarter. Footfalls also fluctuated accordingly with Q1 and Q4 reporting lowest footfalls in FY25 hovering around 30 million while in Q3 footfalls went up to 37.3 million and in Q2 it stood at 38.8 million.
"PVR posted a weak Q4 as footfall revival remains evasive, despite multiple initiatives undertaken by the company. Whether a strong content line-up over FY26 acts as the missing piece of the puzzle remains to be seen,' said Vaibhav Muley, Lead Analyst at Yes Securities.
For the full year, occupancy dipped to 23 percent from 25.6 percent in FY24.
Regional ruled
What saved the day were regional films as South content sizzled at the box office not only in the March quarter but throughout FY25. While Salman Khan was expected to deliver a blockbuster with his Eid release Sikandar, the film underperformed with lifetime collections of Rs 130 crore. On the other hand, Malayalam language film Empuraan brought cheer to the subdued box office in March with the film recording lifetime box office of Rs 125 crore and cementing its place among the highest-grossing Malayalam films of all time.
In Q4, while it was only Chhava from the Bollywood's stable that emerged as the highest-grossing film, earning around Rs 700 crore, a slew of regional releases with their strong performances worked their magic from Sankranthiki Vasthunam, Daaku Maharaj and Game Changer in Telugu to Dragon and Vidaamuyarchi in Tamil.
"Regional saved the day for cinemas in FY25. The share of regional movies at the box office also increased in FY25 and it seems like it will continue in FY26 as we have a strong regional pipeline including Kingdom in Telugu, Kuberaa in Tamil, among others. In addition, the box office of south Indian content dubbed in Hindi surged 153 percent primarily because of Pushpa 2," Bijli said.
In PVR Inox's box office pie, the share of regional movies jumped to 32 percent from 26 percent in FY24 and the share of Hindi dubbed increased to 13 percent from 5 percent. In contrast, Hindi box office share dropped to 41 percent from 51 percent and English box office share dropped to 14 percent from 18 percent.
Subdued performance
Along with footfalls and occupancy, other metrics also remained subdued due to underperformance of English and Hindi films.
Revenue from food and beverage (F&B) sales in FY25 was down 6.7 percent to Rs 1,827 crore versus Rs 1958.4 crore in the previous year. Income from advertising was marginally by 1 percent to Rs 447.5 crore. Average ticket price (ATP) remained unchanged at Rs 259 while Spend Per Head (SPH) increased to Rs 134 from Rs 132.
The first quarter of FY26 also started with some disruptions due to border tensions between India-Pakistan.
"Thursday and Friday (May 8 and 9) were sensitive days and we had directions to close cinemas in sensitive areas in J&K (Jammu & Kashmir) and Pathankot. Things settled down thereafter. On Saturday and Sunday (May 10-11), we had 5 lakh admission each which is a sign of things getting back to normal. Also, the impact was concentrated in Punjab, J&K and south India was not impacted at all," Bijli said.
Cinema versus streaming
One fallout of the Indo-Pak tension was the decision of Maddock Films to release its latest venture Bhool Chuk Maaf directly to streaming on Amazon Prime Video, skipping theatrical release. This raised questions whether streaming is eating into screen business.
The company said that Maddock was a one off. "They decided at the last minute to release the movie on OTT (over the top platform) directly which was being promoted in cinemas for the last two months. We took the matter to court and we have got the stay on the release on OTT platform," the company said.
It also added that the window for a movie to release on a streaming platform is eight weeks after the movie's theatrical release and it will increase now.
"The Hindi film industry believes that it is the big screen where the movies must be released. Sitaare Zameen Par is not going to be released on OTT. Content makers acknowledge that when movies are released on the big screen there is no upper limit to revenues and that theatres are the biggest monetisation window. OTT platforms are also very careful now that they see theatrical performance before they buy a movie. After the theatrical performance they (OTTs) know how much to pay for a movie. OTTs can charge not on the cost of production but on the basis of box office collection. Also, theatrical movies have a better recall value," the company said.
The multiplex chain is seeing a good momentum in Hindi movies.
Hoping for a blockbuster
Bijli is also counting on Hollywood and Bollywood comeback in FY26.
"The release calendar in FY26 looks robust with Hindi and English making a strong comeback. Raid 2 has already done well and Kesari 2 is inching to Rs 90 crore. Up until June quarter, the lineup is strong," he said.
The company also said that the global box office is tracking 7 percent higher than last year in the first quarter of FY26 till date and the India box office is tracking similar numbers.
Hollywood is expected to post a big comeback in FY26 led by return of top franchises on the big screen including Mission Impossible – The Final Reckoning, Jurassic World Rebirth, Fantastic Four: The First Steps, Superman, Predator: Badlands, Now You See Me 3, The Conjuring: Last Rites, among others.
Muley said this is a positive for PVR Inox as it commands 55 percent market share in Hollywood movies and these movies typically enjoy premium ATPs and SPH. "Content line-up looks strong for Bollywood and regional movies as well with release portfolio including Sitare Zameen Par, Housefull 5, War 2, Jolly LLB 3, Son of Sardar 2, Baaghi 4, Kantara: A Legend Chapter 1."
Generating footfalls, cutting costs
In addition to new content, the company is betting big on re-releases as well as alternate content like screening sports and music concerts.
"Re-releases in FY25 contributed 3-4 percent to overall PVR Inox box office and the re-releases on an average recorded 17-20 percent occupancy. Some reruns did better than their original run like Laila Majnu, Sanam Teri Kasam, Tumbbad. It is a strong strategy for us and we will continue with it. What started as an experiment is now a department in the company," Bijli said.
Re-releases recorded over 71 lakh footfalls accounting for 5 percent of the total admissions of PVR Inox last financial year. Reruns made Rs 124 crore GBOC in FY25.
Amid uncertain content pipeline, PVR Inox said that it took various initiatives to generate footfalls including four Cinema Lovers Days and one National Cinema Day, offering tickets at Rs 99. These five days drew 3.4 million moviegoers.
"All PVR Inox initiatives including Cinema Lovers Day, Rs 99 Tuesday, reruns, passport and alternate content added up to 10 percent footfalls and we hope this to go up in FY26," Bijli said.
Along with these initiatives to add footfalls, the company is focusing on reducing capital expenditure (CAPEX). The company expects to incur CAPEX of Rs 400-425 crore in FY26.
The multiplex chain has signed 101 screens over 23 cinemas out of which 46 screens are via management contracts or franchise owned company operated (FOCO) model and 55 screens are part of asset-light model which includes 40-80 percent capex spend by developer. These screens are expected to become operational over next 12-24 months. For management contracts, the company will receive fees of 8-10 percent of revenues. For FY26, the company targets to open 110 new screens out of which over 50 percent screens will be through capital light models. The FOCO model is expected to contribute 30 percent of screen additions in FY26.
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