PVR, Inox Leisure shares hit new highs, all eyes now on pace of recovery

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26 Aug, 2025 12:21

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The share price of multiplex firms PVR Ltd and Inox Leisure Ltd touched a new 52-week high of Rs 1,839 and Rs 466, respectively, on November 8 on the National Stock Exchange. 

With the gradual easing of restrictions, reopening of cinemas and uptick in vaccination, investors are eagerly awaiting a recovery in these two stocks. 

“The recovery ahead is likely to be strong because the content pipeline is promising. Additionally, Maharashtra operating at 100 percent capacity from 50 percent currently would be the next trigger for multiplex stocks,” said Karan Taurani, an analyst at Elara Securities (India). 

Maharashtra is a key state for multiplexes, accounting for 25-30 percent of Hindi box office collections.

The recent release of Akshay Kumar and Katrina Kaif-starrer Sooryavanshi and the expectation that it will deliver robust collections has added to the excitement around multiplex stocks.

The theatrical window, which refers to the timeframe between a movie’s release in a theatre and on other platforms, is expected to widen. 

Better days ahead

“We expect the theatrical window to revive to six-eight weeks (four weeks currently) by end-FY22. Also, the distributor share arrangement may return to pre-COVID levels in the coming months, which will positively impact profitability,” Taurani added.

The multiplex business was among the worst hit by the coronavirus outbreak as cinema halls were among the last to be allowed to resume business as restrictions eased. Both companies reported losses in the financial year 2021.

Things, however, are looking up. PVR and Inox saw a sequential improvement in footfalls for the quarter ending September (Q2FY22), with the staggered opening of cinemas with varying restrictions. 

Losses, too, have narrowed when compared to the first quarter. Analysts expect PVR and Inox to post losses for FY22 as well but lower on a year-on-year basis. 

For the half-year ending September 2021 (H1FY22), PVR and Inox’s consolidated net loss stood at around Rs 373 crore and Rs 210 crore, respectively.

Some analysts expect significant recovery by the end of this financial year, with improved visibility on the return to normalcy as many movies are set to be released.

 “We also note that Disney and Warner Bros have announced large movies with exclusive theatrical releases, which augurs well for exhibitors,” said analysts from IIFL Securities. 

IIFL has maintained its FY23 and FY24 estimates and forecasts 14 percent/11 percent underlying earnings per share CAGR for PVR/Inox through FY19-24. CAGR is the compound annual growth rate.

Third wave a concern

The share prices, however, are yet to surpass their pre-COVID highs. PVR and Inox stocks are around 18 percent and 11 percent away from their highs seen in February 2020.

“We maintain our preference for Inox Leisure given its balance sheet strength. While PVR remains the leader in the space, we believe a discretionary business should be financed conservatively. That said, we also believe a re-rating beyond pre-pandemic levels is possible in both companies as seen in strong retail businesses like Avenue Supermarts, Titan and Jubilant Foodworks,” JM Financial Institutional Securities Ltd said.

If a third COVID wave hits the country, it would delay the recovery for multiplexes. “The biggest risk ahead is the potential new restrictions owing to a third COVID wave,” says Taurani. 

The audience’s wish to return to theatres and the movie content pipeline will be the key monitorables in the coming quarters.