UBS Maintains Buy Rating on PVR with ₹2000 Target

Investment firm UBS has reaffirmed its buy rating on PVR Limited and increased its target price to ₹2000 per share. This positive outlook is driven by expectations of robust performance in Q3 FY25E and Q4 FY25E, supported by strong box office releases and increasing footfalls at theaters.

UBS anticipates that PVR will surprise positively in its upcoming quarterly results, bolstered by blockbuster releases and strategic advancements in its operations.

Pushpa 2: The Rule – A Game-Changer

The much-awaited sequel to the blockbuster "Pushpa," titled Pushpa 2: The Rule, is expected to be a major contributor to PVR's performance. UBS forecasts that the movie will achieve a staggering ₹1000 crore box office collection, with an opening day revenue ranging between ₹150-200 crore.

• Unprecedented advance bookings: Within just 48 hours of opening, the advance bookings for Pushpa 2 have surpassed ₹100 crore. This strong momentum is expected to continue, with total advance bookings projected to cross ₹150 crore before the release.
• High demand across regions: Pushpa 2's appeal spans multiple markets, with extraordinary traction in South India, the Hindi-speaking belt, and overseas markets.

Strong Q3 and Q4 FY25E Performance

PVR is projected to perform exceptionally well in the upcoming quarters, as UBS highlights the impact of major movie releases and sustained growth in cinema attendance. Pushpa 2, coupled with other highly-anticipated films, is expected to drive ticket sales, food and beverage revenue, and advertising income.

Why UBS is Bullish on PVR

UBS's optimism regarding PVR is based on several key factors:

1. Robust Content Line-Up: The upcoming slate of blockbuster movies is expected to attract massive audiences, boosting revenues.
2. Market Leadership: PVR continues to dominate the Indian multiplex market, leveraging its extensive reach and high-quality infrastructure.
3. Pent-Up Demand: Post-pandemic recovery in the entertainment sector has resulted in sustained audience growth, with consumers willing to spend on theatrical experiences.

Conclusion

UBS's revised target of ₹2000 for PVR reflects confidence in the company’s ability to capitalize on major box office hits like Pushpa 2 and deliver strong financial performance in the coming quarters. With advance bookings for Pushpa 2 already breaking records, PVR is well-positioned to exceed expectations in Q3 FY25E and Q4 FY25E.

As the theatrical industry continues its resurgence, PVR's strong operational strategies and blockbuster-driven growth make it a compelling investment choice.