PVR to spend Rs 200 crore on expansion in FY22

India’s leading multiplex chain has earmarked Rs 200 crore for adding new screens in the next fiscal, as the company wants to expand into new cities where it does not have a presence.
The company also has 25 new screens ready to roll out by March-end, awaiting government clearances, Sanjeev Kumar Bijli, joint MD, PVR, told ET.

These include one property at BKC in the western suburbs of Mumbai (one drive-in theatre and a six-screen multiplex), three in Delhi NCR, and one property each in Kanpur, Mysore, Hyderabad and Bengaluru.

“We have a war chest, which will enable us to kickstart our growth… we already have 25 screens, which are fully capitalised, and ready to open, we’re waiting for these last minute licenses,” Bijli said. “We are evaluating the pipeline for next year and looking at some very exciting projects. We will have an outlay of Rs 200 crore in the next financial year for that.”

According to Bijli, the company will start on around 100 screens across the country, including in cities like Trivandrum, Jaipur, Dhanbad, Bhubaneswar, Patna, Nizamabad, Patiala, Ajmer, Jamnagar and Rourkela.

“These are the cities where we still don’t have a presence and it’s very exciting when you go to a new city because we will be able to give that PVR experience to cinema lovers there,” he added.

PVR had raised Rs 1,100 crore in two tranches during the fiscal. It first did a rights issue of Rs 300 crore in July last year, followed by a QIP of Rs 800 crore in February. The company also raised some debt and implemented cost cutting measures during the Covid-19 induced lockdown.
The cinema chain also closed 14 screens across three properties in Mumbai and Pune during this fiscal.

Bijli said these were pre-Covid decisions as the properties were unviable. “Their performances were not as per expectations due to changing market dynamics. Some of the leases were coming to an end, and the numbers weren’t working any which way,” he said.

Meanwhile, Bijli believes that it will be by the second quarter of FY22 when the normalcy will return to the cinema industry, both in terms of advertising and footfalls.

“While our average ticket price (ATP) and spends per head on food & beverages has come back to normal, admissions are growing gradually with new movie releases. Advertising is a laggard and will take some time as they will wait for big films. I think by Q2 onwards all ancillary revenues will start falling into place. Reasonably speaking, the second quarter will be the good time frame to look at the bounceback,” he said.