PVR INOX reported robust Q3 FY2026 results, coinciding with Calendar 2025 becoming the strongest year ever for the Indian theatrical business, achieving a record gross box office of Rs. 13,400 crores. The company delivered 18% EBITDA margins for the second consecutive quarter, achieved at a lower occupancy of 28.5%, underscoring significant merger synergies and cost optimization. PVR INOX is on track to achieve net debt-free status by FY 2026 end.
Q3 FY2026 Earnings and Industry Context
PVR INOX announced its unaudited Standalone & Consolidated Financial Results for the Third Quarter and nine months ended December 31, 2025. The results were discussed on a conference call held on February 5, 2026.
Management noted that Calendar 2025 was the strongest year for Indian cinema, with all-India gross box office collections reaching Rs. 13,400 crores, up 13% YoY and 32% above pre-pandemic levels. Hindi box office grew 18% YoY to over Rs. 5,500 crores, bolstered by major titles like Dhurandhar.
Quarterly Financial Performance
For the quarter (adjusted for IndAS 116):
- Total Revenue: Rs. 1,908 crores (up from Rs. 1,739 crores YoY).
- EBITDA: Rs. 345 crores (up from Rs. 258 crores YoY).
- PAT: Rs. 115 crores (up from Rs. 68 crores YoY).
The company highlighted sustained operating leverage, delivering 18% EBITDA margins at 28% occupancy, a margin level previously seen at 350 to 400 bps higher occupancies.
Footfall and Operational Metrics
During the quarter, the company welcomed 40.5 million guests, marking a 9% YoY growth in footfalls, with occupancy improving to 28.5%. Average Ticket Price (ATP) and Food & Beverage (F&B) spend per head both grew by 4% YoY to Rs. 293 and Rs. 146, respectively.
Growth Strategy and Capital Allocation
PVR INOX is focusing on a capital-light and scalable growth strategy. Year-to-date, 62 new screens were added, exiting 11 loss-making screens. The company is on track to add nearly 100 new screens in FY 2026. Under the capital-light model, 149 screens are now signed.
On the balance sheet front, net debt reduced to Rs. 365 crores as of December 31, 2025, a reduction of over Rs. 1,000 crores since the merger. The recent divestment of the entire stake in the 4700BC premium snacking brand to Marico for Rs. 226.8 crores further supports the path towards negligible net debt levels by March 31, 2026.
Outlook and Content Pipeline
The outlook for Calendar Year 2026 is optimistic due to a stronger, evenly distributed content slate. Key Hindi releases include Dhurandhar 2 and films starring Shah Rukh Khan and Ranbir Kapoor. Hollywood is also projected to have a strong year. The current screen portfolio stands at 1,791 screens across 358 cinemas in India and Sri Lanka.
Q&A Highlights: Margins, Growth, and Ad Revenue
Management confirmed that while advertising revenue was impacted this quarter due to fewer marketable films, they anticipate marginal growth over last year. Regarding future margins, while current EBITDA margins are optimal, efficiency gains are expected from deploying solar panels and optimizing rental agreements through revenue-share deals.
The company confirmed that the divestment of 4700BC will have minimal impact on F&B revenue (less than 1%) as the brand continues to sell in premium properties, while the focus remains on high-margin in-cinema F&B. Furthermore, management indicated that while the company is currently focused on debt reduction and organic growth, capital allocation decisions regarding dividends or buybacks will be made by the Board at the appropriate time.
Source: BSE
