ICICI Securities research report on PVR Inox
PVR Inox performance update states that they have achieved ‘highest ever daily and weekend admissions and box office’. On 13th Aug’23, PVR Inox had 1.28mn admits and 3.36mn admits over Friday to Sunday with GBO revenue >INR 1bn. We think this implies an occupancy of 72-75% on Sunday and 63-65% over 3 days. We have been bullish on the recovery of the movie exhibition business given the strong pipeline since Q2FY24 (link). However, the current performance is a positive surprise. Merger synergies have also started playing out (link). Given the high operating leverage that plays out in this business, we believe earnings upgrades are necessary. We, therefore, upgrade adjusted EBITDA estimates for FY24E/25E by 48%/12%. We are now 52%/8% above consensus.
Outlook
Given our bull case is playing out, it remains a top pick (link) as we raise our target price to INR 2,240. Re-iterate BUY.
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