Summary
PVR INOX Limited - Q3 FY 2026 Earnings Call Summary Thursday, February 05, 2026, 4:00 PM IST
Event Participants
Executives 5 Ajay Bijli (MD), Gaurav Sharma (CFO), Gautam Datta (CEO), Gautam Kumar (ED), Kamal Gianchandani (Chief Business Planning & Strategy)
Analysts 7 Abneesh Roy (Nuvama), Arul/Sujit Jain (Bajaj Life Insurance), Jinesh Joshi (PL Capital), Kavish Parekh (B&K Securities), Priyadarshee D. (Individual), Rishi Dilip Mody (RDM Advisory), Vivekanand Subbaraman (AMBIT)
Financials & KPIs
| Metric | Reported | Commentary |
|---|---|---|
| Total Revenue | ₹1,908 crores | +9.7% YoY; driven by strong December performance from titles like ‘Dhurandhar’. |
| EBITDA (Pre-IndAS) | ₹345 crores | +33.7% YoY; margins steady at 18.1% despite lower occupancy vs pre-COVID. |
| PAT | ₹115 crores | +69.1% YoY; impacted by a ₹44.6 crore one-time labor code provision. |
| Net Debt | ₹365 crores | Reduced by >₹1,000 crores since merger; heading toward negligible levels. |
| Admissions | 40.5 million | +9% YoY; occupancy improved to 28.5% from 25.7% in Q3 FY25. |
| Avg Ticket Price (ATP) | ₹293 | +4% YoY; reflects stable consumer spend and premium format contribution. |
| SPH (F&B) | ₹146 | +4% YoY; bolstered by personalized deals and targeted marketing. |
| Screen Count | 1,791 screens | Added 20 screens while exiting 3 underperforming ones in Q3. |
Geographic & Segment Commentary
- Domestic Box Office: Calendar Year 2025 was the strongest ever for India with ₹13,400 crores gross box office (+13% YoY). Hindi cinema contributed ₹5,500 crores (+18% YoY), supported by ‘Dhurandhar’ (₹1,000 crores cumulative).
- Regional Markets: Gujarati cinema grew 188% YoY following the first-ever ₹100-crore Gujarati film. Malayalam cinema crossed the ₹1,000 crore milestone for the second consecutive year, while Kannada grew 74%.
- Hollywood Segment: Recorded best post-pandemic year in India with ₹1,400 crores (+49% YoY). Recovery was aided by a more consistent content slate and strong franchise performance.
Company-Specific & Strategic Commentary
- Capital-Light Expansion: Management has 149 screens signed under capital-light models (54 FOCO, 95 asset-light). This strategy limits CAPEX to ₹350-₹400 crores annually while targeting 150 new screens in FY27.
- Non-Core Divestment: Concluded the sale of 4700BC popcorn brand to Marico for ₹226.8 crores cash. The move aligns with the strategy to exit FMCG-style businesses while retaining the product in-cinema.
- Cost Optimization: Achieved 18% EBITDA margins at 28.5% occupancy (vs 32% pre-COVID). Efficiency driven by merger synergies, rental renegotiations, and solar deployments reducing electricity costs by 4% YoY.
- Adjacency Growth: Scaling F&B through a food court JV with Devyani International (3 opened to date). Launched in-house brands like ‘Dogfather’ to capture pre-ticketed F&B spend on mall floors.
Guidance & Outlook
| Metric | Guidance / Outlook | Commentary |
|---|---|---|
| Screen Additions | ~100 (FY26) / ~150 (FY27) | Shift toward capital-light models and renovation of high-value legacy sites. |
| CAPEX Outlay | ₹350 - ₹400 crores (FY27) | Includes new screens, maintenance, and tech upgrades (projection/sound). |
| Debt Status | Net Debt Free (Q1 FY27) | Driven by ₹226.8cr divestment proceeds and healthy internal accruals. |
| Content Outlook | “Best years ahead” (CY26) | Robust pipeline including SRK’s ‘King’, ‘Ramayana’, ‘Avengers Doomsday’, and ‘Dune 3’. |
Risks & Constraints
| Risk | Context |
|---|---|
| Advertising Volatility | Ad revenue dipped this quarter due to fewer “marketable” blockbusters. Management expects recovery in FY27 as content density increases. |
| Regulatory/Legal | Ongoing CCI investigation into VPF and Karnataka High Court stay on ticket price caps. Management is cooperating with authorities; impact currently manageable. |
| Content Concentration | Global consolidation (e.g., Warner Bros/Netflix talks) remains a watchpoint. Management is monitoring potential impacts on the global exhibition window. |
Q&A Highlights
Advertising Revenue
- Question: Why did ad revenue decline despite strong box office? (Abneesh Roy)
- Answer: Volume dipped due to a lack of “perceived” blockbusters early in the quarter (4 vs 8 last year). Yields remain steady, and AI-driven targeting is being used to regain traction (Gautam Datta).
Asset-Light Model & Debt
- Question: Will the company use cash for accelerated debt repayment or dividends? (Kavish Parekh/Siddhant)
- Answer: Focus is on prepaying gross debt to reach negligible levels by year-end. Dividend decisions remain with the Board; priority is funding growth and maintenance CAPEX (Gaurav Sharma).
Occupancy & Margins
- Question: Is the current 18% margin sustainable at 28% occupancy? (Priyadarshee D.)
- Answer: Yes. Structural cost changes in rentals and electricity mean the business no longer requires 32%+ occupancy to hit these margins. Further optimization in electricity via solar is ongoing (Gaurav Sharma).
Content Strategy
- Question: How do you view the clash of big films like ‘Dhurandhar’ and ‘Toxic’? (Siddhant)
- Answer: Clashes are often synergistic. Capacity exists to handle ₹135-₹140 crore gross days. Regional-Hindi clashes work well as they dominate different territories (Kamal Gianchandani).
Key Takeaway
PVR INOX delivered a robust Q3 FY2026, highlighted by a 33.7% YoY increase in EBITDA and a significant reduction in net debt to ₹365 crores. The company successfully executed its non-core divestment of 4700BC for ₹226.8 crores, accelerating its path to becoming net debt-free by early FY2027. Despite a temporary lag in advertising revenue, the core business demonstrated strong operating leverage, achieving pre-COVID margins at lower occupancy levels due to merger synergies and structural cost reductions. Strategic focus has pivoted toward an asset-light expansion model with a ₹350-₹400 crore annual CAPEX cap. With a record-breaking CY2025 behind them and an exceptionally strong 2026 film slate featuring major Hindi and Hollywood tentpoles, management remains confident that the company’s best financial years are ahead, provided the content cycle remains consistent.
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