Despite the pandemic’s devastating impact on the film exhibition business, multiplex chains are on an expansion spree encouraged by the fast business recovery, strong patronage for big screen viewing and the industry’s long-term growth prospects.
The two major multiplex operators - PVR Cinemas and Inox Leisure - collectively added 56 new screens, adding over 6,000 seats in the last two years since the onset of the pandemic.
In the first three quarters of the current fiscal, India’s largest film exhibitor PVR Cinemas, added 18 new screens taking the total number of screens to 860 and over 182,000 seats spread across India and Sri Lanka. The new additions included PVR’s flagship 7-screen multiplex cinema and India’s first drive-in rooftop theatre at iconic Jio World Drive Mall at BKC Mumbai in partnership with Reliance retail.
PVR narrows consolidated net loss in Q3The company’s consolidated revenues stood at ₹709.7 crore as compared to ₹320.1 crore in the corresponding quarter in the previous fiscal
“We continue to remain extremely bullish on the long-term prospects of the business and will continue to invest and innovate in bringing richer and more experiential formats for our audiences,” Ajay Bijli, Chairman cum Managing Director, PVR Ltd said at the company’s Q3FY22 earnings call. The film exhibitor said December 2021 was the best quarter for the company since March 2020 when the business was adversely impacted on account of the pandemic.
The country’s second-largest movie exhibitor, Inox Leisure, was even more aggressive. From 626 screens and 1,44,467 seats as of March 2020, Inox Leisure’s screen count went to 667 screens and 1,50,621 seats as of December 2021. Of the 41 new screen additions planned for FY22, Inox Leisure already has opened 24 screens while it is planning to add the remaining 17 screens (3,577 seats) in the rest of the fiscal.
“Beyond FY22, we have signed up to the extent of nearly 135 properties, 935 screens with 1,73,000 seats and once this entire pipeline is fully implemented we will have 297 properties, 1,619 screens, and nearly 3,27,000 seats,” Alok Tandon, CEO, Inox Leisure said in the Q3 earnings call.
Number of screens abysmally low
Although more than 2,000 films were released every year prior to the pandemic, the number of screens in India was abysmally low at 8-8.5 screens per million population compared to 37 screens per million in China and 124 in America. The pandemic further worsened it by forcing an estimated 1,000-1,500 single screen operators to shut down.
Third wave pushes recovery of multiplex operators to April-June quarter : ICRARestrictions imposed by various State govts has dashed imminent recovery
Encouraged by the recovery trends and audience willingness to come back to cinemas for high-quality content, multiplex operators are reviving their expansion plans which were put on hold soon after the pandemic.
“We remain positive on the multiplex industry as OTT players’ massive spends on acquiring digital movie rights with practically no ROIs look unsustainable. With limited out-of-the-home entertainment options in India, audiences should come back to cinemas for a better viewing experience, provided the quality of content remains high,” said Naval Seth, Media & Entertainment analyst at Emkay Global.