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IDBI Capital
PVR (Buy)
CMP: ₹514.50
Target: ₹652
PVR is the largest multiplex operator in India with about 417 screens. Encompassing over 6 crore footfalls every year, PVR enjoys dominant market share of about 20-25 per cent for Bollywood movies and about 30-35 per cent share for English movies box office collections. With very low differentiation available among multiplex operators, the company’s prime retail space of about 40 lakh sq.ft. currently and another 20 lakh sq.ft. under development will act as key competitive advantage.
We expect company to add 65 screens every year to reach screen size of 560 by FY16E. We believe that there will be an uptrend in the average ticket prices on the back of rising disposable income and strong base of young audiences. The increasing foray of foreign studios in Indian Film Industry, including Fox Star, Endemol, Virgin India, Sony, Viacom 18 and Warner Bros provides more capital access and enables better availability of film content. PVR is better placed to leverage on the multiplex revolution in India, given its strong positioning as formidable entertainment brand.
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