Hold PVR; target of Rs 1085: ICICI Direct

ICICI Direct's research report on PVR

PVR’s Q4FY20 performance was impacted by Covid-19 and further aggravated by ordinary box office collections in February. Footfalls came in at 19.5 mn, down 29.1% YoY, leading to box office revenues at Rs 330 crore, down 26.9% YoY. F&B revenues fell 24.6% to Rs 174.6 crore with SPH at Rs 96, up 5.5% YoY. Advertisement revenues declined ~22% YoY to Rs 68.5 crore. EBITDA (without impact of Ind-AS 116) came in at Rs 42.8 crore, down 73% YoY with margins of 6.6% (down 1260 bps YoY). Given the write-off of Rs 31.7 crore in net deferred tax asset while shifting to a new tax rate, the company reported net loss (without impact of Ind-AS 116) at Rs 47.8 crore.

Outlook

We will closely track the reopening of cinemas amid Covid-19 and turn buyer only when we witness footfall revival and stability. We maintain HOLD rating and value the stock at 10x FY22E (ex-Ind-AS) EV/EBITDA with a target price of Rs 1085/share.

PVR 14062020

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