PVR Inox Ltd (PVRINOX) Q2 FY27 Earnings Call: EBITDA Jumps 44% On Best-Ever Quarter, Targets 500 Screens Over 3 Years

PVR Inox Ltd held its Q2 FY27 earnings call on October 28, 2026. Here's a quick read of what management said — performance, strategy, and the outlook ahead.

Best-Ever Quarter on Revenue, EBITDA and PAT

• Record company quarter — Ind AS 116-adjusted total income grew 17% YoY to Rs.2,133 Cr; EBITDA rose 44% YoY to Rs.475 Cr; PAT more than doubled to Rs.273 Cr; sixth consecutive quarter of YoY revenue growth.
• Margin expansion of ~420 bps — EBITDA margin reached 22.3% in Q2 FY 2026-2027 (H1 FY 2026-2027: 18.7%) vs 17–18% pre-COVID, attributed by management to merger synergies, cost discipline and capital efficiencies.
• 46.3 million guests (+4% YoY) — occupancy rose to 30.4%; average ticket price of Rs.298 and F&B spend per head of Rs.153 were each up 14% YoY.
• H1 FY 2026-2027 actuals — total income Rs.3,775 Cr (+15% YoY); EBITDA Rs.705 Cr (+56% YoY); PAT Rs.344 Cr (+233% YoY).
• Trailing 12-month ROCE of 16.5% (as of Q2 FY 2026-2027), up from 10.2% in FY26 and above the ~13% pre-COVID benchmark.
• Rs.7 Cr of one-offs in other income — reversals of old provisions after recovery of pending collections from filmmakers on the distribution side, plus small interest on tax refunds for a past assessment year.

Record Industry Box Office; English Cinema Breaks Rs.1,000 Cr

• Industry gross collections of Rs.4,433 Cr in Q2 FY 2026-2027 — highest quarterly collection on record and first quarter above Rs.4,000 Cr; industry box office grew 23% YoY after 20% in Q1 FY27; H1 FY27 industry collections grew 22% YoY to Rs.7,618 Cr.
• English collections grew 87% YoY to Rs.1,024 Cr — first Rs.1,000-crore quarter; Spider-Man: Brand New Day grossed Rs.608 Cr (India's highest-grossing English film ever) and Nolan's Odyssey Rs.233 Cr with exceptional IMAX/premium-format demand.
• Hindi and regional breadth — Hanumanansh (Rs.351 Cr) and Mirzapur (Rs.267 Cr, first streaming-series-to-theatrical adaptation, which management called the beginning of a new trend); regional hits included Jana Nayagan (Tamil, Rs.200 Cr) and Toxic (Kannada, Rs.296 Cr).
• Growth gap vs industry — PVR INOX grew ~18% vs industry ~23% in Q2 FY 2026-2027; CFO Gaurav Sharma attributed this to content mix, with films like Hanumanansh, Mirzapur and regional hits over-indexing in tier 2/3/4 towns where single-screen penetration exceeds multiplex presence.
• Hindi base effect, not weakness — of ~Rs.1,400 Cr incremental industry box office in H1 FY 2026-2027 vs H1 FY 2025-2026, only ~Rs.110 Cr came from Hindi and ~Rs.150 Cr from dubbed Hindi; management (Kamal) attributed this to an exceptionally strong Q2 FY 2025-2026 Hindi base and expressed industry-level confidence (explicitly not PVR INOX guidance) in a big jump in incremental Hindi box office in Q3-Q4 FY 2026-2027.
• Dubbed-collection reclassification — Spider-Man's ~Rs.600 Cr included ~35% (~Rs.200 Cr) from the Hindi-dubbed version; per industry norm these sit in English collections, so Hindi growth is "very strong" over and above the ~11-12% visible in reported H1 FY 2026-2027 data.
• Producers returning to theatrical-first — management (Kamal) described streamers as having retreated from aggressive direct-to-platform acquisition over the last 3-4 years, concluding theatrical-first release is more viable; all three budget segments (micro, mid, big) are "currently firing."

Screen Cleanup Behind Us; Tier 3/4 Format Opens New Engine

• Net screen count roughly flat post-merger — ~1,890 screens in Q4 FY23 vs ~1,800 in Q2 FY27 (~100 net adds over ~3.5 years) as obsolete-mall screens were shut; MD Ajay Bijli said this cleanup "is behind us now."
• 150-175 net screen additions per year from FY 2027-2028 — management said this could be achieved, possibly more, and affirmed the analyst's suggestion of ~500 screens over the next 3 years (FY 2027-2028 to FY 2029-2030).
• Smart cinema pilot (Muzaffarpur) — capex 25-30% lower and opex ~25% lower than standard screens; ATP ~190 vs company average of Rs.298 in Q2 FY 2026-2027; first two months of trading above expectations.
• ~100 smart cinemas signed — two more under fit-out (Rampur, Bharatpur), with openings over the next 12-18 months (into FY 2027-2028) across 300 identified cities; the bulk of smart screens will open in FY 2027-2028, with 60-70 "could be this number" per Ajay Bijli, who added it is "difficult to put a number."
• H1 FY 2026-2027 expansion — 24 new screens across 6 cinemas (predominantly asset-light) opened and 25 screens exited (majority loss-making); network now spans 1,797 screens across 114 cities in India and Sri Lanka; on track for 90-100 new screens in FY27, bulk in H2 FY27, mainly capital-light.
• Unit-economics discipline — post-COVID caution will continue; paybacks of maximum 3-4 years on any new cinema (period unspecified); mix of COCO, developer-partnership and FOCO structures so growth is not restricted to one agreement type.
• Accounting treatment — per CFO Gaurav Sharma, asset-light cinemas carry the full P&L in company books; FOCO/franchise cinemas recognize only management fees, with operating costs at the franchisee level.

Structural Margin Gains; Maiden Buyback and New Capital Policy

• F&B gross margins improved from ~74% to ~77-78% (current level as of Q2 FY 2026-2027) despite discounted offerings, driven by renegotiated vendor terms, 4PL logistics migration and automation to use near-expiry inventory; management sees further headroom.
• F&B headroom vs mature markets — ~40% of F&B growth from volume and ~60% of SPH growth from value increases in Q2 FY 2026-2027; F&B SPH is only ~60% of ATP vs mature Western markets where food SPH equals ATP; popcorn and Pepsi contribute ~60% of F&B sales at high gross margins.
• 85% F&B strike rate — close to 85% of walk-ins consumed some F&B in Q2 FY 2026-2027, aided by personalized offers from the near-complete footfall database; discounted offers (Rs.99 weekday mornings, Rs.149 Friday first shows, Rs.79 front rows) target price-sensitive moviegoers.
• Rs.604 Cr of free cash flow in H1 FY 2026-2027 — Rs.259 Cr of debt repaid; maiden Rs.300-Cr share buyback executed in September (Q2 FY27); net cash of Rs.141 Cr at end-September (Q2 FY27), up from Rs.81 Cr in June (Q1 FY27).
• New board-approved capital allocation policy (announced Q2 FY27) — three priorities: continued investment in screens, premium formats and technology; net debt/EBITDA to remain within 0.5x after any distribution; management expects to return ~30% of annual surplus cash flow to shareholders via dividends, buybacks, or a combination (timing and quantum at the board's discretion).
• Growth not compromised by returns — responding to a question on whether the 30% cash-return plan (period unspecified) constrains growth, Ajay Bijli said there is "no question of compromising on growth," with 50% of India's screens still single screens (industry context).
• Depreciation lower by Rs.35-40 Cr per year — useful life extended for select assets (especially projectors and IT equipment) after engagement with auditors, effective FY 2026-2027; CFO confirmed the ~Rs.35-40 Cr reduction continues going ahead (period unspecified).

South Is a Priority Market; Lower ATP Offset by Occupancy

• South India holds roughly 45% — possibly as high as 50% — of India's ~10,500 screens per management's (Kamal) estimate, noting exact industry data is not available; this compares with 34% of PVR INOX's own screens in the South per the Q2 FY 2026-2027 investor presentation.
• 35-40% of new screens opened in the South over the last 2-3 years — CFO Gaurav Sharma cited low multiplex penetration and the company's low share of South Indian film collections as headroom.
• South ATPs run ~25% below the rest of the country — Tamil Nadu tends to be the lowest, while Kerala, Karnataka, Telangana and Andhra Pradesh are better than Tamil Nadu but still below other parts of India.
• Higher occupancy "more than makes up" for lower ticket prices — per the CFO, responding to whether South screens are less margin-accretive.
• No ticket price caps on the horizon — on ticket price caps discussed in southern states of India, management said there are "no such conversations at all."

H2 FY27 Slate, Advertising Pipeline and Capex Ramp

• H2 FY 2026-2027 film slate — Hindi: Ramayana Part 1 (November, Q3 FY27), Shah Rukh Khan's King (December, Q3 FY27), Love and War and Golmaal 5 (Q4 FY27); pan-India regional: Chiranjeevi's Kaka and Prabhas' Spirit; Hollywood: The Hunger Games: Sunrise on the Reaping, Avengers: Doomsday, Dune Part 3, Jumanji Open World.
• Advertising recovery expected in H2 FY 2026-2027 — H1 lacked big tentpole films; management expects substantial advertising revenue from 4 big films slated for Q3-Q4 FY 2026-2027 (Ramayan, King, Avengers, Love and War) and to end FY 2026-2027 at a fairly healthy growth number.
• Digital pay-per-eyeball advertising platform ~8-10 months away — expected in FY 2027-2028, to monetize sleeper hits (Hanuman, Maha Avatar Narsimha, Sayara) that drew strong footfalls but insufficient advertising.
• FY 2026-2027 capex guided at Rs.300-320 Cr — vs Rs.132 Cr spent in H1 FY 2026-2027, as new screen additions and payouts accelerate in H2; FY 2027-2028 capex likely to be more than Rs.350 Cr (plus/minus depending on pipeline, fit-outs and on-ground execution), with screen additions exceeding FY 2026-2027.
• Management "hopeful and optimistic" on H2 FY 2026-2027 — based on the current slate, industry momentum and consumer demand, and expects H1 performance to continue; Gaurav Sharma did not commit to Q3 FY 2026-2027 footfalls exceeding Q2, noting audience response is hard to predict, though release schedules, scale and quality look "very encouraging."
• Asset recycling not being pursued — with the balance sheet cash positive and no debt-repayment requirement, the CFO said "there is no rationale" to sell owned cinema properties as they contribute to revenue and earnings.