CMP: Rs. 286.75; Accumulate at every levels.
Short term Target – Rs. 300; STOP LOSS – Rs. 263.80; Market Cap: Rs. 1,136.01 Cr; 52 Week High/Low: Rs. 340.90 / Rs. 141.00
Short term Target – Rs. 300; STOP LOSS – Rs. 263.80; Market Cap: Rs. 1,136.01 Cr; 52 Week High/Low: Rs. 340.90 / Rs. 141.00
Total Shares: 3,96,16,995 shares;
Promoters : 2,23,09,467 shares –56.31 %; Total Public holding : 1,73,07,528
shares – 43.68 %; Book Value: Rs. 70.35; Face
Value: Rs. 10.00; EPS: Rs. 5.45; Div: 60 % ; P/E: 52.61 times; Ind P/E: 30.79;
EV/EBITDA: 6.80.
Total Debt: Rs. 225 Cr; Enterprise Value: Rs. 1,599.01 Cr.
PVR LIMITED: PVR
Limited was incorporated in 1995 and is based in Gurgaon, India. PVR LTD was
incorporated in April 1995 pursuant to a joint venture agreement between Priya
Exhibitors Private Limited and Village Roadshow Limited, one of the largest
exhibition companies in the world. PVR Limited is an India-based company that
operates movie houses in India. The Company also generates revenue from
in-cinema advertisements/product displays and in-cinema sale of food and beverages.
It also produces and co-produces movies; and distributes movies, as well as
operates 24 lane bowling centers. The company operates 213 screens in 46
cinemas in 27 cities. Company’s subsidiaries include CR Retail Malls (India)
Limited (CRR), PVR Leisure Ltd, PVR Pictures Limited (PVR Pictures), Cine Hospitality Private Ltd and PVR bluO Entertainment
Limited (PVR bluO). The Company has diverse cinema circuit in India consisting
of 35 Cinemas with 154 screens spread over 20 different cities: Delhi,
Faridabad, Gurgaon, Ludhiana, Ghaziabad, Mumbai, Bangalore, Hyderabad, Chennai,
Lucknow, Indore, Aurangabad, Baroda, Allahabad, Ahmedabad, Udaipur, Chandigarh,
Surat, Latur and Raipur. PVR Ltd announced the opening of a multiplex on August
15, 2012, at Empress Mall, in Nagpur in the state of Maharashtra. The multiplex
consists of five screens. On January 8, 2013, PVR through its wholly owned
subsidiary Cine Hospitality Private Ltd purchased a controlling stake of over
69% followed by the open offer for another 26% in the Cinemax India Limited for
Rs. 395 Cr or Rs. 203.65 per share from the Rashesh Kanakia and family.
PVR Ltd is locally compared with Fame India Limited, Cinemax Properties Ltd,
Era E Zone (India) Ltd, Pyramid Saimira Theatre Limited and Inox Leisure Ltd
and globally it is compared with Orange Sky Golden Har. Ente. Holdings Ltd of
Hong Kong, Kinepolis Group NV of Belgium, Cinemax X AG of Germany, Digital
Cinema Destination Corp of United States and Reading International Inc of
United states.
Investment Rationale:
PVR pioneered the multiplex revolution in
the country by establishing the first multiplex cinema in 1997 at Saket, New
Delhi. The opening of the first multiplex heralded (started a good beginning) a new era in the Indian
cinema viewing experience and which also changed the industry forever. From
then-on PVR initiated many path breaking innovations in the industry from
launching its largest 11 screen multiplex in the country in 2004 in Bangalore and introducing Gold Class Cinema. PVR Ltd came with
an IPO on 8th December 2005 with an issue price of Rs. 225/share and
raised about Rs. 173.25 Cr with an objective to utilize the proceeds to finance
the then new cinema projects in various cities across the country, to expand
the film distribution business, technological up gradation and renovation of
cinemas. PVR entered into a JV with Major Cineplex Group in 2008, a
leading Film exhibition and retail entertainment company based out of Thailand,
to bring lifestyle entertainment concepts to Indian consumers. The JV enjoined setting up of bowling alleys, karaoke centers, ice skating
rings and gaming zones across the country to enhance the out of home
entertainment experience for Indian consumers. PVR Cinemas today contributes
about 20%-25% of domestic box office collections of any leading Hollywood movie
and 12%-13% of any leading Bollywood movie, highest across the Indian Film
Exhibition space. On January 8, 2013, PVR through its wholly owned subsidiary
Cine Hospitality Private Ltd purchased a controlling stake of over 69% in the Cinemax India Limited for Rs. 395 Cr
or Rs. 203.65 per share from the Rashesh Kanakia and family followed by the open offer for another 26% of Rs. 148 Cr, with the success of open offer which ended on 23rd February 2013,
PVR will now look at de-listing of Cinemax which will comply with the norms of
SEBI to maintain minimum public shareholding of 25%. With the successful open
offer of Cinemax, PVR, which has already added 47 screens this year will have 351 screens in 85 properties across 36 cities in India with 87,493 seats on combined basis, this translates into entertaining a staggering 5.3 Cr customers every year.
PVR expects to add 55 more screens by the end of FY14.
Outlook and Valuation:
 |
| PVR's IMAX Auditorium in Bengaluru |
Name of the Companies
|
Number of Screens
|
|---|---|
PVR Cinemax
|
351 Screens
|
INOX + Fame
|
256 Screens
|
BIG Cinemas
|
254 Screens
|
FUN Cinemas
|
73 Screens
|
Cinepolis
|
49 Screens
|
Sathyam Cinemas
|
27 Screens
|
TOTAL
|
1,010 Screens
|
| KEY FINANCIALS | FY12 | FY13E | FY14E | FY15E |
|---|---|---|---|---|
| SALES (Rs. Crs) | 513.10 | 825.70 | 1,322.50 | 1,465.80 |
| NET PROFIT (Rs. Crs) | 25.40 | 30.20 | 58.20 | 74.80 |
| EPS (Rs.) | 9.80 | 7.50 | 14.50 | 18.60 |
| PE (x) | 26.90 | 35.10 | 18.20 | 14.20 |
| P/BV (x) | 2.40 | 1.70 | 1.50 | 1.40 |
| EV/EBITDA (x) | 15.30 | 8.80 | 5.10 | 4.20 |
| ROE (%) | 9.10 | 4.70 | 8.40 | 9.70 |
| ROCE (%) | 9.00 | 4.80 | 8.90 | 9.60 |
I would buy PVR LTD with a price target of Rs. 300.00 for the short term target. As I always say, I am a long term believer in markets & I do respect the markets and will keep a strict stop loss of 8 % or Rs. 263.80 on your purchase. (Why Strict stop loss of 8 % ?) - Click Here
READ HERE TO KNOW MORE ON LONG TERM INVESTING - CLICK HERE
Excellent! Much appreciated!!
ReplyDeleteKeep Going!