PVR Inox unveils a Rs 700-crore strategy to establish new screens and revamp existing ones

Newly merged multiplex giant PVR Inox has unveiled an ambitious plan to enhance its cinema experience by adding up to 175 new screens and upgrading existing ones with an investment of Rs 700 crore during FY24. This strategic move comes in the wake of PVR Inox’s ongoing efforts to rationalize its operations in locations where it has been experiencing losses.

The timing of the expansion couldn’t be better, as the cinema industry is recovering its momentum after a prolonged pandemic-induced hiatus. Ajay Bijli, the Managing Director of PVR Inox, expressed his optimism about the company’s prospects, stating, “PVR Inox is set to invest approximately Rs 700 crore in FY24 to introduce new screens, upgrade existing ones with cutting-edge technology, and enhance the overall ambience to provide audiences with an exceptional movie-going experience.”

According to Bijli, the company anticipates a robust business environment as the Covid situation improves and smaller towns and cities emerge as attractive destinations. In fact, average ticket prices have already surpassed pre-Covid levels in most locations. In FY23, PVR Inox achieved an average ticket price of Rs 236 (for the merged entity), compared to Rs 204 (for PVR standalone) in the pre-Covid fiscal year of 2020.

In its expansion plans, PVR Inox is targeting several tier-2 and -3 cities, including Rourkela, Bhubaneswar, Dharwad, Cuddalore, Jodhpur, Hubli, and Ajmer. By venturing into these untapped markets, the company aims to capitalize on the pent-up demand for high-quality cinematic experiences among audiences in these areas.

The merger of PVR and Inox, two renowned chains in the Indian cinema industry, was driven by the goal of leveraging their synergies to overcome challenges posed by lockdowns and the growing popularity of streaming platforms like Netflix, Amazon, and Disney Hotstar. Last week, PVR Inox reported its consolidated financial figures, which revealed a net loss of Rs 334 crore and revenues of Rs 1,143 crore for January-March. As part of its strategy to optimize performance, the company announced the closure of 50 underperforming screens that were no longer financially sustainable.

Currently, PVR Inox operates a total of 1,689 screens across 361 cinema locations. Bijli is confident that the synergies resulting from the merger will significantly enhance the operational profitability of the combined entity. He stated, “Our goal is to achieve annual recurring EBITDA synergies of Rs 225 crore over the next 12-24 months. While the majority of our screens are currently concentrated in metros and tier-1 cities, we are actively expanding into new cities each year and expanding our footprint in tier-2 and tier-3 cities, which have yet to experience the joy of multiplexes.”

PVR Inox’s strategic investment in screen expansion and technological upgrades demonstrates its commitment to providing movie enthusiasts with unforgettable cinematic experiences. With a rejuvenated cinema industry and a renewed focus on untapped markets, PVR Inox is poised to capture the hearts of audiences across the country.

 

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