The box office success of recent releases "Rustom", "Sultan", "Kabali", "Udta Punjab" and "Housefull 3" seems to be rubbing off on multiplexes also. This is evident from the share prices of PVR and Inox Leisure that have gained over 35 per cent in the last three months.
PVR shares were trading at Rs. 1,211.20 apiece at around 3.05 p.m. on Monday (August 22) on the BSE. Based on the closing price of Rs. 864.05 on May 23, the gain is 40 per cent.
Similarly, Inox Leisure shares have risen 37 per cent from their May 23 closing price of Rs. 195.45 and were trading at Rs. 268.95 on Monday on the BSE.
The upbeat box office collections also mean good business for multiplexes.
PVR operates 552 screens at 127 properties in 47 cities across India, while Inox Leisure has 423 screens in India, including the launch of its recent property in Bengaluru in June.
Released on August 12, "Rustom" starring Akshay Kumar, Ileana D'Cruz and Esha Gupta has been a box office success, collecting over Rs. 100 crore in just 10 days.
Salman Khan's "Sultan", which had Anushka Sharma in the female lead, grossed over Rs. 300 crore in five weeks after its release in the first week of July. It has also become the third Bollywood film to enter the Rs. 300-crore movie club.
"Mohenjo Daro", starring Hrithik Roshan and Pooja Hegde, has also earned about Rs. 100 crore in 10 days of release in worldwide box office collections, according to IANS. The film has been directed by Ashutosh Gowariker.
Multi-lingual film starring Rajinikanth earned almost Rs. 200 crore in India at the box office since July 22. The movie also did good business at overseas centres.
Besides increased footfalls, multiplexes such as PVR and Inox are also expected to benefit from a possible lowering of tax rates as and when the Goods and Services Tax (GST) comes into force.
"PVR and Inox pay about 22 per cent net entertainment taxes. With GST rate expected at 17-18 percent, these firms' taxes would decline, but this benefit will be partially offset by an increase in VAT. Net-net, we expect about 200-300bp EBITDA margin growth for these firms at a GST rate of 17-18 per cent," BoAML had said earlier in its note.
PVR had reported a marginal fall in net profit to Rs. 42.81 crore despite 17.3 per cent rise in revenues to Rs. 570 crore for the quarter ended June 30.