Mul­ti­plex stocks take a dive

The Times of India (Mumbai edition) - - TIMES CITY -


Ma­ha­rash­tra gov­ern­ment’s stand com­ing out, the stock price of PVR crashed over 13% in Fri­day’s mar­ket to close at Rs 1,214 on BSE, los­ing Rs 183 in just one ses­sion. The stock of Inox Leisure, an­other mul­ti­plex op­er­a­tor, also closed 5.4% or nearly Rs 14 lower at Rs 239. The com­bined loss of in­vestors’ wealth in PVR was Rs 855 crore with its mar­ket cap now at Rs 5,675 crore, while in Inox Leisure the loss was Rs 132 crore with the mar­ket cap at Rs 2,303 crore.

The gov­ern­ment’s de­ci­sion to end dual pric­ing from Au­gust 1is ex­pected to hit the rev­enues of mul­ti­plexes. Some bro­ker­ages es­ti­mate that on an av­er­age, mul­ti­plexes earn about 25% rev­enue from F&B sales and have gross mar­gins of around 75%.

Data on BSE showed PVR had spent nearly Rs 160 crore on buy­ing food & bev­er­ages dur­ing fis­cal 2018. Its con­sol­i­dated net profit for the year was Rs 124 crore. Ac­cord­ing to Batli­vala & Karani, dur­ing the Jan­uary-March quar­ter of fis­cal 2018, the av­er­age price of a ticket in a PVR mul­ti­plex was Rs 209 and a per­son watch­ing a movie in a PVR theatre spent Rs 87 on av­er­age on food and drinks.

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