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Cinemax: Occupancy remained subdued…
Cinemax’ Q3FY11 consolidated result was better than our expectation.
The topline stood at | 57.4 crore against our expectation of | 51.2 crore,
growing 13.5% QoQ and declining 3.4% YoY. The EBITDA margin stood
at 19.8%, expanding 437 bps QoQ while YoY it contracted by 989 bps.
Q3FY10 was characterised by blockbuster movies like 3 Idiots and Ajab
Prem Ki Ghajab Kahani. PAT stood at | 4.1 crore (I-direct estimate: | 2.5
crore) as compared to | 10.7 crore in Q3FY10.
ƒ Highlights of the quarter
The company rolled out three new properties in this quarter. With
this, the total properties under operation have reached 32, with 102
screens and 27,042 seats. Occupancy for Q3FY11 stood at 26% as
compared to 23%in Q2FY11 and 32% in Q3FY10. ATP fell to | 134
from | 138 in the last quarter. F&B spend remained flat at | 35 QoQ.
EBITDA margins for the quarter stood at 19.8% improving 437 bps
QoQ and declining 989 bps YoY. The steep decline in YoY
performance happened as Q3FY10 had blockbuster movies like 3
idiots and Ajab Prem Ki Ghajab Kahani, whereas big budget movies
like Action Replay, Khelein Hum Jee Jaan Sey, Guzaarish, No
Problem and Tees Mar Khan failed to perform at the box office.
Valuation
We estimate the company will add 24 more screens and have 40
properties with 126 screens by the end of FY12. With several new super
starrers slated for release in FY12, we believe the outlook for the
multiplex industry remains robust. However, Q4FY11 may be subdued
with the ICC World Cup followed by IPL season 4 in the early part of FY12.
At the CMP of | 47, the stock is trading at 16.8x FY11E EPS of | 2.8 and
13.7x FY12E EPS of | 3.4. We have valued the stock at 14x FY12E and
arrived at a target price of | 48, implying an upside of 3%. We have
changed the rating on the stock from REDUCE to ADD.
Outlook & Valuation
Outlook
The company reported better-than-expected numbers in this quarter.
Although many big budget movies failed to make an impact at the box
office, Cinemax managed to improve its occupancy on a sequential basis.
The company has guided for several new properties to be launched in
FY12. We estimate the company will add 24 more screen and have 40
properties with 126 screens and a seating capacity of 33,307 by end of
FY12. With several new super starrers slated for release in FY12, we
believe the outlook for the multiplex industry remains robust. However,
Q4FY11 may be subdued with the ICC World Cup followed by IPL season
4 in the early part of FY12.
Valuation
At the CMP of | 47, the stock is trading at 16.8x FY11E EPS of | 2.8 and
13.7x FY12E EPS of | 3.4. We have valued the stock at 14x FY12E and
arrived at a target price of | 48, implying an upside of 3%. We have
changed our rating on the stock from REDUCE to ADD.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
Cinemax: Occupancy remained subdued…
Cinemax’ Q3FY11 consolidated result was better than our expectation.
The topline stood at | 57.4 crore against our expectation of | 51.2 crore,
growing 13.5% QoQ and declining 3.4% YoY. The EBITDA margin stood
at 19.8%, expanding 437 bps QoQ while YoY it contracted by 989 bps.
Q3FY10 was characterised by blockbuster movies like 3 Idiots and Ajab
Prem Ki Ghajab Kahani. PAT stood at | 4.1 crore (I-direct estimate: | 2.5
crore) as compared to | 10.7 crore in Q3FY10.
ƒ Highlights of the quarter
The company rolled out three new properties in this quarter. With
this, the total properties under operation have reached 32, with 102
screens and 27,042 seats. Occupancy for Q3FY11 stood at 26% as
compared to 23%in Q2FY11 and 32% in Q3FY10. ATP fell to | 134
from | 138 in the last quarter. F&B spend remained flat at | 35 QoQ.
EBITDA margins for the quarter stood at 19.8% improving 437 bps
QoQ and declining 989 bps YoY. The steep decline in YoY
performance happened as Q3FY10 had blockbuster movies like 3
idiots and Ajab Prem Ki Ghajab Kahani, whereas big budget movies
like Action Replay, Khelein Hum Jee Jaan Sey, Guzaarish, No
Problem and Tees Mar Khan failed to perform at the box office.
Valuation
We estimate the company will add 24 more screens and have 40
properties with 126 screens by the end of FY12. With several new super
starrers slated for release in FY12, we believe the outlook for the
multiplex industry remains robust. However, Q4FY11 may be subdued
with the ICC World Cup followed by IPL season 4 in the early part of FY12.
At the CMP of | 47, the stock is trading at 16.8x FY11E EPS of | 2.8 and
13.7x FY12E EPS of | 3.4. We have valued the stock at 14x FY12E and
arrived at a target price of | 48, implying an upside of 3%. We have
changed the rating on the stock from REDUCE to ADD.
Outlook & Valuation
Outlook
The company reported better-than-expected numbers in this quarter.
Although many big budget movies failed to make an impact at the box
office, Cinemax managed to improve its occupancy on a sequential basis.
The company has guided for several new properties to be launched in
FY12. We estimate the company will add 24 more screen and have 40
properties with 126 screens and a seating capacity of 33,307 by end of
FY12. With several new super starrers slated for release in FY12, we
believe the outlook for the multiplex industry remains robust. However,
Q4FY11 may be subdued with the ICC World Cup followed by IPL season
4 in the early part of FY12.
Valuation
At the CMP of | 47, the stock is trading at 16.8x FY11E EPS of | 2.8 and
13.7x FY12E EPS of | 3.4. We have valued the stock at 14x FY12E and
arrived at a target price of | 48, implying an upside of 3%. We have
changed our rating on the stock from REDUCE to ADD.
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