Buy PVR INOX; target of Rs 2200: Sharekhan

Sharekhan's research report on PVR INOX

The company is witnessing robust BO collections, driven by Hindi blockbusters – Gadar 2, OMG 2; Hollywood movies; and Regional Blockbusters, rekindling the OOH entertainment medium as strong content continues to drive footfalls. A robust content pipeline across languages is lined up in Q3, which is expected to maintain footfalls despite Cricket World Cup in October-November 23. Operational metrics are expected to witness a marked improvement, starting Q2FY2024, led by strong footfalls, while diversified and strong content is expected to reduce content risk.

Outlook

We maintain Buy rating with revised PT of Rs 2,200 on account of strong BO collections and expect marked improvement in operational metrics, backed by strong content pipeline across languages coupled with merger-related cost and revenue synergies. At the CMP the stock trades at 21.9x its FY26E EPS and 10.8x its FY26E EV/ EBITDA.