PVR Inox Q2 Review - Strong Quarter As Expected; Robust Pipeline Keeps Us Positive On Q3: ICICI Securities

ICICI Securities Report

PVR Inox Ltd. reported highest ever revenue, Ebitda and profit after tax in Q2 FY24, in-line with our estimates. While October and first half of November, is likely to be comparatively slower, we believe footfalls could sharply recover from second half of November buoyed by a strong content pipeline.

Also noteworthy is management calling out Ebitda synergy of Rs 1.2 billion to Rs 1.4 billion in H1 FY24 and signalling that there is more to come.

PVR Inox has repaid ~Rs 1.1 billion in debt in H1 FY24 and net debt has reduced by Rs 3.3 billion. The company is hopeful of achieving positive free cash flow in FY24. It is also working on reducing the variability of earnings by negotiating revenue sharing contracts with landlords.

Overall, management expects steady return on capital employed improvement to mid teen levels in FY24. Maintain 'Buy'.

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