PVR and Inox plan to be India’s Avengers

whether it’s told as “unity is strength” from Aesop’s fables or “apes together strong” from the movie Rise Of The Planet Of The Apes, it is an age-old story. it is about how togetherness helps overcome adversities that alone may not be possible. that principle seems to be at the forefront of two of India’s largest cinema exhibition brands announcing their plans for a merger. the plot seems to be a hit with investors as well, who sent the stocks of both PVR and Inox soaring to their 52-week highs on March 28, the day after the announcement.

is it time to book a ticket to this journey?

big picture

the merger, which is expected to take a few months to formalise, instantly makes the resultant entity the single-largest cinema exhibitor in India with over 1,500 screens. while that would give it a share of around 16% of the ~9,500 screens in India, it plans to stretch far beyond. the immediate goal is to double that number and expand to 3,000 screens in the next seven years. in the grander scheme of things, it is to push the overall number of screens in India closer to the present 40,000 in the US and 70,000 in China.

trend reversal

this merger comes at the end of a month when cinema exhibitors have been washed over by a fresh wave of hope. hope that seemed impossible at the peak of the pandemic when OTT platforms threatened to completely erase memories of cinema halls from the minds of audiences. however, following many hit movies raking in pre-pandemic-like box office collections in March, exhibitors are popping the corn again. while streaming platforms will continue to grow, the increasing clutter of services and the resulting fatigue are also providing cause for hope.

with March’s collections on record and the promise of a large outlay ahead, PVR and Inox are confident they can convince movie makers to once again release to big screens first and then OTTs. if that goes to plan, the pre-pandemic story of their growth alongside India’s entertainment consumption is back on the cards. as long as Covid-19 decides that it’s finally time to exit stage right.