Emkay Global Financial's report on PVR
PVRL’s revenue declined 12.5% qoq to Rs5.4bn but beat our estimates on marginally higher ATP, SPH and footfalls. Footfalls saw a sharp rebound in March as the Omicron wave receded, with net box office collections in the month surpassing pre-Covid levels. Q4 footfall print of 14.3mn was impressive, considering fewer operational days, with March contributing ~64% of the footfalls. ATP inched up to Rs242, while SPH was down by 5.4% qoq to Rs122 on a high base. Though PVR’s screen additions lagged behind Inox in FY22, it is likely to make up for this in FY23 with additions of 120+. Ad revenue recovery is in a slow lane and should take 3- 4 months to reach pre-Covid levels as national advertisers are yet to fully come back.
We are raising FY23/24E revenue by 4.3%/4.1% to factor in higher screen rollouts. Maintain Buy with a revised TP of Rs2,165 (Rs2,230 earlier) as we cut the target multiple of the merged co. to reflect the higher CoE while rolling forward valuations to Jun’24E.
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