The changing contours of cinema-goers & underperforming Hindi movies weigh down PVR Inox

The changing contours of cinema-goers & underperforming Hindi movies weigh down PVR Inox
PVR Inox is struggling because of underwhelming Hindi movies and changing attitudes of cinema-goersBCCL
  • India’s largest multiplex chain PVR Inox is hurting due to lacklustre performance of Hindi movies and fewer Hollywood releases during the March quarter.
  • Hindi movies, which contributed to more than half of PVR Inox’ box office collections, have ceded 17% market share since 2019, according to a FICCI-EY report.
  • The changing contours of the Indian cinemagoer is further weighing down PVR Inox.
India’s largest multiplex chain PVR Inox is hurting due to lacklustre Hindi movie box-office collections and fewer Hollywood releases during the March quarter. The changing contours of the Indian cinemagoer is further weighing down PVR Inox.

Despite a strong start to the quarter with Pathaan and Avatar: Way of Water, which continued to do well post its December release, moviegoers shunned the theatres due to a weaker movie line-up in February and March.

During the March quarter, PVR Inox widened its net loss to ₹333 crore from a loss of ₹105 crore a year ago. However, revenue rose to ₹1,169 crore from ₹579 crore a year ago. It is worth noting that the results of Q4 FY23 are of the merged PVR Inox entity, while those of Q4 FY22 are only of PVR. As such, the results are not comparable. The PVR Inox was completed in March 2023.

“There was considerable volatility in box office quarter-on-quarter. We believe that the 2 major factors that marred the industry in FY23 – underperformance of Hindi films and less number of Hollywood releases,” said Ajay Bijli, managing director, PVR Inox.

However, he sounded optimistic about FY24. He expects the two factors that adversely impacted the company’s performance “will both ease out,” even as the company said it plans to open 150-175 more screens in FY24. It currently has 1,689 screens across the country.


PVR Inox will also be shutting down 50 screens across the country over the next six months, but the company said this is due to the fact that they are either loss-making or are housed in malls that have reached the end of their life cycle.

In afternoon trade on Tuesday, PVR Inox’s shares were down by 2.2% at ₹1,433 apiece. In 2023 so far, the stock has declined 17%.

Hindi movies are struggling

On scratching the surface, the fall of Hindi movies is evident from the decline in their share in the box-office collections of not just PVR Inox but of the entire Indian film industry.

In a post-earnings presentation, PVR Inox underlined that the contribution of Hindi movies, including the dubbed versions of other languages, has fallen to 51% in FY23 from 60% during the pre-pandemic period.

On the other hand, regional language movies have seen a sharp increase of 10 percentage points, taking their share to 33% in FY23.

The changing contours of cinema-goers & underperforming Hindi movies weigh down PVR Inox
PVR Inox's box-office collections in FY23Business Insider India

Indian cinemagoers are shunning theatres

It’s not just underwhelming Hindi movies or fewer Hollywood movies that are weighing on PVR Inox’s performance – Indian cinemagoers are also increasingly shunning theatres.

According to a FICCI-EY report on the Indian media and entertainment industry, footfalls increased to 994 million in 2022, but were still significantly lower than the 1.46 billion seen in 2019.

“One reason for reduced footfalls was the lower urgency to view a film due to shorter digital-release windows,” the report said.

This is immediately visible in the frequency of theatre visits. “Industry discussions indicated that heavy cinemagoers reduced from 2-4 times a month to just once a month, while light visitors (a few times a year) also shrunk,” the FICCI-EY report said.

Further lending credence to this is the growth of digital media and its rising share in the total media and entertainment industry revenue pie – according to EY estimates, digital media collections grew to ₹13,200 crore in 2022, increasing its contribution to 27% in 2022 from 16% in 2019.

The rise of South Indian films

The rise of South Indian films – especially after the success of films like Pushpa, KGF and RRR – has lifted the profile of regional cinemas across the country, even as the language divide is bridged by dubbed releases.

“Hindi cinema ceded 17% market share since 2019; South Indian films now command over 50% of box-office revenues, and some South Indian films were released nationally,” the FICCI-EY report said.

Some of the South Indian films that saw a nationwide release in FY23 include KGF Chapter 2, Kantara and Sita Ramam.

According to the FICCI-EY report, the number of movies that crossed the ₹100 crore box-office collection mark rose to 22 in 2022 – half of these were South Indian films, while only 8 were Hindi films. Of these 8 Hindi films, 2 were dubbed versions of South Indian films.

As already mentioned, Hindi movies account for 51% of PVR Inox’s box-office collections as opposed to 34% across the Indian cinema industry. As a result, underperformance of Hindi movies has a bigger impact on PVR Inox compared with the industry as a whole.

$PVR.NSE has merged with Inox and now the combined entity basically is the single biggest major player in the cinema industry. However, the share has been continuously falling after the merger mainly due to the poor performance in general of Bollywood movies. The numbers around their growing F&B business are a comfort for an investor. One can look to add the stock on dips in my opinion. Current level of 1415 and then the level of 1300 are good strong support zones. No bullish trend is currently visible but looks a good candidate for bottom fishing.

— (@thebullofdalalstreet) May 16, 2023


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