They already talked about Bahubali and Bajrangi on last earnings call so might have frontloaded revenue numbers.
There could still be some surprise element from other releases like Welcome Back. In long term, I am not enthused about PVR for the following reasons.
1) Company does not have strong capabilities of merger integration and have overpaid for acquisitions. They wrote-off Rs305 crore in goodwill from Cinemax’s deal, which was valued at Rs543 crore.
2) Management ignored lessons from Cinemax’s deal and paid a higher multiple for DT Cinemas’ acquisition. They might write-off goodwill soon after realizing that they overpaid for the transaction.
3) Management has reduced its stake significantly, which most VPers have already discussed here.
4) Sellside has been modeling 4-5% constant increase in ATP without realizing that blended ATP would either come down or stay stable as pressure from small town expansion kicks in. If PVR wants to deliver on its growth plans then it would have to open significant number of theatres in small towns. Average ATP in small towns ranges between Rs80-Rs120, while PVR’s existing ATP is close to Rs180.
5) PVR might also face lower occupancy in small towns. Most of the new construction is happening in suburban areas in small towns, where footfalls are lower compared to central locations. In absence of location advantage, PVR’s theatre might face lower occupancy. I already notice this effect in some small towns.
6) PVR’s levered balance sheet and merger history does not give me any comfort in investing in PVR’s stock.
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