Is this stock the next big ticket for investors?

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Subscribe to enjoy similar stories. If you’d asked anyone before covid about the movie exhibition business, the answer would’ve been simple: single screens were fading and multiplexes were booming. And they weren’t wrong.

The numbers told a clear story. Between 2013 and 2020, PVR's revenue climbed from INR 806 crore to INR 3,414 crore—a solid 23% annual growth. Operating margins were strong, too, moving from below 14% in 2013 to 20% in 2019, then shooting above 30% in 2020.

Then everything changed. When covid hit, it wasn’t just the theatres that closed. Viewer habits began to shift, and PVR found itself in rough waters.

Profits vanished, massive losses followed, and the entire industry was left reeling. By 2023, the landscape had shifted again as PVR joined forces with INOX, creating India’s largest cinema chain—PVR INOX, which accounts for more than 50% of total multiplex revenues. But despite reducing losses, the company is still in the red in 2024.

Also read: Could these two monopoly businesses still generate solid returns? The stock tells a similar story. From 2013 to 2020, PVR’s stock delivered an impressive 33% annual return. But after covid it plummeted 60%.

While the stock has recovered some ground, it's essentially back to 2017 levels. Someone who bought in 2017 and held on would have seen zero gains even though revenue is now three times what it was back then and the company has merged into an industry giant. A lot has changed, hasn’t it? The big question now is: what’s next for PVR INOX? Once a rock-solid opportunity in entertainment, is its stock still worth betting on? Can it deliver the returns investors hope for? Let’s dive in and find out.