ICICI Securities Recommends Buying PVR Inox, Targets Rs 1500

PVR INOX Sees Significant Growth in Q4FY26

PVR INOX, a leading player in the entertainment industry, has reported a strong revenue growth of 25.8% YoY in Q4FY26. This significant increase can be attributed to a rise in Average Ticket Price (ATP) by 22% YoY and Show Per Hour (SPH) by 32% YoY. Despite Q4 being a seasonally weak quarter, the company's favourable content slate, which included Dhurandhar 2, Project Hail Mary, and Border 2, played a crucial role in driving this growth.

The management's focus on capital-light expansion has been a key factor in the company's success. In FY26, 55% of screen additions were made under FOCO/asset-light formats, resulting in lower capital intensity and better Return on Capital Employed (ROCE). This strategic approach has led to a significant reduction in net debt, which has decreased by approximately 90% since the merger to INR 1.6 billion. The company's healthy free cash flow generation has also contributed to this reduction, with management targeting a net cash position in the near term.

Looking ahead to FY27, PVR INOX remains optimistic, driven by a diversified movie pipeline and a signed pipeline of 138 screens to be executed over the next 18 months. This ambitious plan is expected to further drive growth and expansion for the company.

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Investment Outlook

We maintain a BUY rating on PVR INOX with an unchanged target price of INR 1,500, based on a multiple of 12x adjusted FY28E EBITDA.