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Last Updated : Jun 15, 2020 04:14 PM IST | Source: Moneycontrol.com

Hold Inox Leisure; target of Rs 235: Emkay Global Financial

Emkay Global Financial recommended hold rating on Inox Leisure with a target price of Rs 235 in its research report dated June 09, 2020.

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Emkay Global Financial's report on Inox Leisure

Inox reported better operating performance compared to PVR, with EBITDA rising 13% yoy, above our projections. Ticket sales also declined, but still better than PVR, owing to a 7% increase in ATP. F&B margins contracted 346bps sequentially, partially impacted by one-time inventory write-off. Management remains confident about rent waive-off during the lockdown and lower payout in subsequent quarters or till the business normalizes. Management plans to open 41 screens with a capex outlay of ~Rs300mn as 85% of the work has been completed for these screens. We estimate 30 screen additions in FY21. We expects footfalls to normalize from Q4FY20, starting with big-ticket releases from Q3.


Opening of cinemas in India and globally, with movie releases and occupancy, would be vital for the stock price. We maintain a Hold rating while ascribing 9x on FY22E EBITDA (IND-AS adj.) to arrive at a TP of Rs235. We remain EW in sector EAP.

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First Published on Jun 15, 2020 04:14 pm