- Target
- ₹1,500
- At report
- ₹1,064+41% printed
- Vs our close
- +26.0%
ICICI Securities retains BUY on PVR Inox as its thesis of the company turning net-cash positive by Q1FY27 played out, with net cash of ~INR807mn as of 30-Jun-26 versus peak debt of INR14.3bn. Q1 revenue grew 10.4% YoY with adjusted EBITDA margin nearly doubling to 12.9%, and the broker sees the strong Q2/Q3FY27 content pipeline and a leaner, cash-funded ~100-screen expansion plan as catalysts for a stock re-rating, maintaining an unchanged TP of INR1,500 on 12x FY28E EBITDA.
- PVR turned net cash positive (~INR807mn) as of Jun'26, from peak debt of INR14.3bn, after three years of sustained free cashflow generation
- Q1FY27 revenue grew 10.4% YoY to INR16.2bn, with admits up 7.6% YoY to 36.6mn and ATP/SPH up 7.5%/8.8% YoY despite modest occupancy of ~25.3%
- Adjusted EBITDA margin nearly doubled to 12.9% (vs 6.5% in Q1FY26) on sustained cost discipline; PAT was INR565mn, aided by lower interest outgo
- Healthy cash position and a leaner capex model (FY27 capex guidance cut to ~INR3.5bn from ~INR4bn) give management flexibility to fund the ~100-screen FY27 pipeline without added leverage
- India's box office grew 20% YoY in Q1FY27 across metros and tier 2/3 markets, spanning multiple languages, without a single INR5bn+ release, reflecting a well-diversified content calendar
- Robust Q2/Q3FY27 content pipeline (including Avengers: Doomsday, Dune: Part Three, Drishyam 3) expected to make Q3 the strongest quarter yet; TP maintained at INR1,500 on 12x adj. FY28E EBITDA
- Lower-than-expected performance of upcoming movies
- Merger synergies not playing out as expected
- Revenue INR16,222mn, up 10.4% YoY, up 4.8% QoQ
- Adjusted EBITDA INR2,095mn, up 119.8% YoY; margin 12.9% vs 6.5% in Q1FY26
- PAT INR565mn vs a loss of INR545mn in Q1FY26
- Admits 36.6mn, up 7.6% YoY; occupancy 25.3%
- ATP INR273, up 7.5% YoY; F&B spend per head INR161, up 8.8% YoY
- Net cash position of INR807mn as of Jun'26, versus net debt of INR1,670mn as of Mar'26
- 90-100 gross screen additions (~80 net) guided for FY27; bulk of loss-making screen closures already completed in Q1FY27
- Screen growth expected to accelerate from FY28, aided by developer interest in FOCO and asset-light formats in tier 2/3 markets (~300 underserved cities with population above 150k)
- Online ticketing penetration rose to 68.8% in Q1FY27 (from 63.4% in Q1FY26), driving ~29% YoY growth in convenience fee income
- Capital allocation priorities centred on ROCE/ROE improvement; buybacks and other shareholder-return options under Board evaluation
| Broker estimates | Unit | FY25A | FY26A | FY27E | FY28E |
|---|---|---|---|---|---|
| Net Revenue | INR mn | 56,999 | 66,462 | 75,391 | 84,619 |
| EBITDA | INR mn | 15,573 | 21,345 | 24,491 | 27,308 |
| EBITDA Margin | % | 27.3 | 32.1 | 32.5 | 32.3 |
| Net Profit | INR mn | -2,651 | 3,113 | 4,759 | 5,387 |
| EPS | INR | -27 | 17.9 | 48.6 | 55 |
| P/E | x | -39.4 | 59.6 | 21.9 | 19.4 |
| EV/EBITDA | x | 7.3 | 5 | 4.2 | 3.7 |
| RoCE | % | 2.4 | 8.7 | 10.6 | 11.6 |
| RoE | % | -3.7 | 3 | 6.2 | 6.6 |
Valuation: 12x adj. FY28E EBITDA. ICICI Securities maintains BUY with an unchanged target price of INR1,500, based on a multiple of 12x adjusted FY28E EBITDA.
Extraction note: No explicit change-in-estimates table is presented in this report; the TP of INR1,500 is stated as unchanged from the prior (12-May-2026 Q4FY26) report.