In an interview with CNBC-TV18, Ajay Bijli, CMD of PVR spoke about the latest happenings in his company and sector. He was speaking from the side-lines of the Kotak Institutional Equities - Chasing Growth Conference.
We have already opened about 49 screens this year and there is another 10-11 more that we can open in March. Hopefully we should be closing at about 62-63 screens this year, he said.
Next year we have a very good ramp up of almost 100 screens. It is a mix of screens in different parts of the country and in different catchments, he added.
Speaking about footfalls, he said that we measure it primarily by the number of people who visit our cinemas. This year probably will be closing about 75-80 million and next year with the addition of another 100 screens, we could touch a figure of at least about 100 million people vising our cinemas.
Below is the verbatim transcript of the interview.
Anuj: What is the target in terms of screen additions for Q4 and FY19 and currently the weightage of premium screen stands at 10 percent, are you planning to increase the same?
A: We have already opened about 49 screens this year and there is another hopefully 10-11 that we can open in March – two properties in Mysore, one property in Karnal and then one in Chennai. So hopefully we should be closing at about 62-63 screens this year but next year we have a very good ramp up of almost 100 screens and they will have a mix of everything, we will have premium formats that we have recently introduced like P[XL], some IMAX screens are there, there are some gold class screens, playhouse and then we are also looking at tier-III and tier-IV towns. So it is a mix of screens in different parts of the country, in different catchments.
Sonia: I wanted to talk about some of the disruptive forces in the business. There has been a reduction in the telecast restriction window between theatrical release and satellite release and we have also seen a lot of these over-the-top (OTT) applications are gaining the traction, how is that impacting the footfall and the occupancy levels for you?
A: There is no reduction still, movies are getting released on any other platform after the theatrical release of about – we have clear 6-8 weeks window. So there is no reduction and if you look at the overall box office despite OTT platforms everywhere, there has been an increase in revenues. I was just reading the unique report on the European cinema, that has gone up. US has gone up. So I think all these talks become more audible when the content flow itself is not doing well but along comes Jumanji, along comes Black Panther, along comes Padmaavat and all of a sudden people come back to the cinemas.
So there is not that much impact that we are feeling just now.
Surabhi: Q3 was great from point of view of margins because we saw solid expansion, Q4 what trends can you share with us in terms of footfalls and maybe a look ahead in FY19 as well?
A: We measure primarily by a number of people who visit our cinema. So this year probably we will be closing at about 75-80 million and next year with the addition of another 100 screens, we could touch a figure of at least about 100 million people vising our cinemas.
Anuj: The ad revenue growth has been at 10 percent in the last two quarters, do you expect the runrate to continue?
A: We probably will end-up closing at about Rs 280-290 crore of ad revenues and we grow at about 18 percent roughly every year. So that trajectory will continue to remain.
Sonia: Nine months of the year are done, you have done revenues of almost Rs 1,750 crore, what does FY18 revenue look like and more importantly, what is the growth that one can expect for FY19?
A: We will close the year – only about a month is left now – at about Rs 2,350 crore and we are looking at about 20 percent increase next year.
Surabhi: So average ticket prices were around Rs 212 in Q3, are you looking at price increases in Q4?
A: Prices we have been steadily growing by about 5 percent every year and F&B increase about 10-11 percent every year on spend per head (SPH) - that is the kind of growth we are achieving and that is how it is looking like in the next year as well.