PVR Ltd., incorporated in the year 1995, is a Mid Cap company (having a market cap of Rs 7154.74 Crore) operating in Media & Entertainment sector.
Financials
For the quarter ended 31-12-2020, the company reported a Consolidated Total Income of Rs 320.13 Crore, up 189.42 % from last quarter Total Income of Rs 110.61 Crore and down -65.35 % from last year same quarter Total Income of Rs 923.89 Crore. Company reported net profit after tax of Rs -49.21 Crore in latest quarter.
Investment Rationale
PVR has seen a steady 30% EBITDA growth in the last 10 years, which has led to a steady jump in its stock price. This was led by improving occupancies and steady new screen additions. With a higher base of screens, expectations of the pace of additions slowing in the near term, and pressure on occupancies, earnings growth could be significantly lower. The brokerage sees limited room to play the recovery trade once COVID-19 risk diminish as the enterprise value has seen a limited fall, despite the steep stock correction, given the recent capital raise of INR14b. The stock is richly valued at 10x FY23E EV/EBITDA despite the risk of lower growth, high leverage, and lower RoCE profile over the last five years. The recent rise in COVID-19 risk should certainly impact FY22E earnings.
Promoter/FII Holdings
Promoters held 18.8 per cent stake in the company as of Dec 30, 2020, while FIIs held 38.5 per cent, DIIs 26.6 per cent and public and others 16.1 per cent.
