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PVR reported impressive performance in 2QFY2012 on the earnings front.
The company’s revenue grew by 2.5% yoy and by impressive 18.1% sequentially.
OPM declined by 434bp yoy due to high rental costs, though it improved on a
qoq basis due to healthy top-line growth. PAT during the quarter grew by 58.2%
yoy, but declined sequentially. 1QFY2012 had an exceptional item from sale and
lease back of Phoneix Mills property. We recommend Accumulate on the stock.
Key highlights: Occupancy increased to 36% in 2QFY2012 from 30% in
2QFY2011. ATP decreased by ~5% yoy during the quarter to `152. Footfalls
increased to 7.1mn in 2QFY2012 from 5.7mn in 2QFY2011. Despite a 434bp
yoy operating margin expansion, recurring earnings for the quarter came in at
`14cr due to low depreciation and amortization costs. Also, the quarter witnessed
an increase in food and beverage (F&B) spends by 158bp yoy to `9.2cr (`6.8cr)
and higher share of film distributors to `35cr (`28cr). During the quarter, the
company opened the much-awaited second bowling alley under its brand PVR
Blu’O in Vasant Kunj, New Delhi.
Outlook and valuation: For FY2011-13E, we expect PVR to register a ~13%
CAGR in its top line, aided by seat additions and higher contribution from
bowling alleys. Earnings are expected to register a CAGR of 80% over the same
period on account of low base and an impressive movie pipeline. Also, the
company’s decision to concentrate on its core business will lead to improved
earnings going forward. Also, big ticket releases such as Ra.One and Rockstar in
3QFY2012 could keep earnings momentum strong in the near term. At the CMP
of `128, the stock is trading at 11.4x FY2013E EPS. We recommend Accumulate
on the stock with a target price of `143.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
PVR reported impressive performance in 2QFY2012 on the earnings front.
The company’s revenue grew by 2.5% yoy and by impressive 18.1% sequentially.
OPM declined by 434bp yoy due to high rental costs, though it improved on a
qoq basis due to healthy top-line growth. PAT during the quarter grew by 58.2%
yoy, but declined sequentially. 1QFY2012 had an exceptional item from sale and
lease back of Phoneix Mills property. We recommend Accumulate on the stock.
Key highlights: Occupancy increased to 36% in 2QFY2012 from 30% in
2QFY2011. ATP decreased by ~5% yoy during the quarter to `152. Footfalls
increased to 7.1mn in 2QFY2012 from 5.7mn in 2QFY2011. Despite a 434bp
yoy operating margin expansion, recurring earnings for the quarter came in at
`14cr due to low depreciation and amortization costs. Also, the quarter witnessed
an increase in food and beverage (F&B) spends by 158bp yoy to `9.2cr (`6.8cr)
and higher share of film distributors to `35cr (`28cr). During the quarter, the
company opened the much-awaited second bowling alley under its brand PVR
Blu’O in Vasant Kunj, New Delhi.
Outlook and valuation: For FY2011-13E, we expect PVR to register a ~13%
CAGR in its top line, aided by seat additions and higher contribution from
bowling alleys. Earnings are expected to register a CAGR of 80% over the same
period on account of low base and an impressive movie pipeline. Also, the
company’s decision to concentrate on its core business will lead to improved
earnings going forward. Also, big ticket releases such as Ra.One and Rockstar in
3QFY2012 could keep earnings momentum strong in the near term. At the CMP
of `128, the stock is trading at 11.4x FY2013E EPS. We recommend Accumulate
on the stock with a target price of `143.
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