Festive films may lift Q3, but PVR INOX’s longer-term recovery remains patchy: Elara

PVR INOX may see near-term relief in its stock driven by improving movie occupancies, but a sustained re-rating will hinge on the delivery of consistent box-office hits, according to Karan Taurani, Executive Vice President at Elara Capital.

Taurani expects a strong third quarter for multiplex operators, supported by the festive season and the release of big-ticket films such as Dhurandhar and Avatar in December.

However, he cautioned that the broader box-office recovery remains uneven, with small and mid-budget films continuing to underperform.

To reduce its dependence on theatrical revenues, PVR INOX has been expanding its food and beverage (F&B) offerings and exploring lifestyle-led formats. While these initiatives could help support footfalls and enhance the customer experience, Taurani said scaling them into a meaningful standalone business will be challenging.

One of the key positives for PVR INOX, according to Taurani, is the South Indian market. The southern film industry has been more successful in building franchise-led content, which has translated into better post-pandemic occupancies, he said.

Average occupancy stood at around 24–25% in the first half of the year, Taurani anticipated up to 27–28% improvement in the third quarter on the back of a stronger film slate.

Financially, PVR INOX swung to a net profit of Rs 106 crore in the quarter ended September 2025, compared with a loss of Rs 11.8 crore a year earlier. Revenue rose 12.4% year-on-year to Rs 1,823 crore, while EBITDA increased 27.7% to Rs 611.7 crore.

The company also reported its highest post-pandemic second-quarter advertising income at Rs 125.6 crore, up 15% year-on-year, and recorded admissions of 44.5 million.