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Analyst Research Report Snapshot


PVR Ltd. (PVRL) - Qtr. Update - Dated - July 31, 2013




Axis Capital Limited


31 Jul 2013





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PVR reported strong performance in Q1FY14 (in line with expectations). Synergies from Cinemax acquisition benefited PVR through higher F&B spend and steep rise in advertisement/ sponsorship revenue in the quarter. We believe such benefits coupled with higher footfalls (led by screen expansion) will drive revenue going ahead. We remain excited about PVR’s ability to monetize footfalls, given PVR’s dominant market share and geographic presence. Maintain BUY with TP of Rs 410 (16x FY15E EPS of Rs 25.6), implying 17% upside from CMP of Rs 351. The stock trades at PE of 22.7x FY14E EPS of Rs 15.5 and 13.8x FY15E EPS of Rs 25.5. Strong operational performance  The company reported revenue of Rs ~3.4 bn, EBITDA of Rs 594 mn (EBITDA margin of 17.7%), and PAT of Rs 140 mn. Note consolidated numbers are not comparable YoY due to the Cinemax acquisition in Q4FY13  Gaining from synergies, the company’s F&B spend per head (SPH) increased to Rs 54 in Q1FY14; Cinemax' SPH increased to Rs 50 (vs. Rs 44 in Q4FY13), while PVR's SPH increased to Rs 56.5 (vs. Rs 50.4 in Q4FY13) in the quarter  PVR added 22 screens (382 screens in Q1FY14) and is on track to add 80-90 screens in FY14. Footfalls increased across PVR and Cinemax screens to 15.2 mn, while Average Ticket Price inched up to Rs 169 (Rs 164 in Q4FY13) Regards, Chirag Negandhi (ED & Deputy Head of Research) Institutional Equity Research Axis Capital Ltd Tel.: + 91 22 4325 1106 Ankur Periwal (VP - Media) Institutional Equity Research Axis Capital Ltd Tel.: + 91 22 4325 1118

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