In 2024, PVR INOX faced challenges from content supply volatility, leading to fluctuations in occupancy, admissions, and box office collections, which impacted P&L performance. Rising operational costs, particularly real estate expense, further strained profitability amidst an incomplete recovery in occupancy levels.
However, it implemented cost control measures with a sharper focus on operational efficiencies, enabling us to navigate these challenges effectively. With upcoming releases across Hindi, Hollywood, and regional languages, it anticipates a robust recovery in footfalls, paving the way for an improved financial performance.
Medianews4u.com caught up with Gaurav Sharma, CFO PVR INOX
Q. How would you describe the performance of PVR Inox and the cinema exhibition business in 2024 compared to 2023?
The Indian box office displayed resilience in 2024, maintaining a steady performance compared to 2023. According to Ormax, the gross collections for the first 11 months of 2024 reached Rs. 9,862 crores, just 4% lower than the same period in 2023. December is poised to propel the industry closer to the 2023 record benchmark of Rs, 12,226 crores, thanks to the mega block buster ‘Pushpa 2: The Rule’ alongside other significant releases such as ‘Baby John’ (Hindi), ‘Mufasa: The Lion King’ (Hollywood), ‘Viduthalai: Part-2’ (Tamil), ‘Barroz’ (Malayalam), and ‘Max’ (Kannada).
Hindi films’ collections in 2024 saw a slight dip compared to the previous year, with 3 films crossing the Rs. 500 crore mark compared to four in 2023. However, the year set remarkable new records, with Pushpa 2: The Rule becoming the highest-grossing Hindi film in history and Stree 2 following closely. Mid-scale films also performed well, with genres like horror comedies (‘Stree 2’, ‘Munjya’, ‘Bhool Bhulaiyaa 3’) resonating strongly with audiences. Hollywood faced some headwinds due to industry strikes, resulting in a softer year, but the outlook remains bright with a robust slate lined up over the next two years.
PVR INOX, despite early challenges from prolonged elections and weaker content slates, witnessed strong recovery in the second half. A robust release slate, coupled with blockbuster performances from Hindi films such as ‘Pushpa 2: The Rule’, ‘Bhool Bhulaiyya 3’, and ‘Singham Again’, has driven a strong bounce-back. With the industry shifting focus back to theatrical releases and a robust slate of both domestic and international films in the pipeline, PVR INOX is well-positioned to capitalise on this momentum and play a leading role in redefining the cinema experience for audiences globally.
Q. From a P&L perspective what were the challenges that PVR INOX faced in 2024?
In 2024, PVR INOX faced challenges from content supply volatility, leading to fluctuations in occupancy, admissions, and box office collections, which impacted P&L performance. Rising operational costs, particularly real estate expense, further strained profitability amidst an incomplete recovery in occupancy levels.
However, we implemented cost control measures with a sharper focus on operational efficiencies, enabling us to navigate these challenges effectively. With a strong slate of upcoming releases across Hindi, Hollywood, and regional languages, we anticipate a robust recovery in footfalls, paving the way for improved financial performance.
Q. One area of focus for the industry was to increase footfalls. How did the industry and PVR Inox do this through flexible ticket pricing, reduced food prices on weekdays and an enhanced experience in 2024?
To drive footfalls and enhance audience engagement in 2024, the cinema exhibition industry, including PVR INOX, adopted a strategic mix of initiatives that focused on accessibility, affordability, and enhanced experiences. Industry-wide campaigns like National Cinema Day and Cinema Lovers Day offered discounted tickets at Rs. 99, attracting millions of guests across 4,000+ screens. These events celebrated the joy of cinema and reaffirmed its place as an inclusive entertainment medium.
At PVR INOX, innovative initiatives drove footfalls and increased consumption:
i. Movie subscription programme: The Movie Passport offered audiences the opportunity to watch four weekday films for just Rs. 349 a month, encouraging frequent visits.
ii. Alternative content strategy: We introduced diverse content such as T20 World Cup matches, concerts, curated movie festivals (Oscar Movie Festival, Pride Film Festival, Raj Kapoor festival), and live telecasts of significant events like the Republic Day parade, Ram mandir Pran Pratishthan ceremony etc. driving strong occupancies.
iii. Re-release strategy: Our strategy of releasing classics has paid great dividends starting with Rockstar in Q1 to ‘Tumbbad’, ‘Laila Majnu’, ‘Rehna Hai Tere dil Main’, ‘Veer Zara’ in Q2. ~6% of our admissions in Q2, and ~13% in Sep’24 have come from re-releases.
iv. Immersive previews: A novel initiative allowed audiences to enjoy 30-minute trailers for Rs. 1, offering a cinematic sneak peek into upcoming blockbusters.
v. Food and beverage innovations: We launched Rs. 99 weekday meal plans, unlimited refill offers for weekends, and partnered with EazyDiner and Kotak for additional discounts and cashback on tickets and F&B. A strategic JV with Devyani International to enter the food court business diversified our revenue streams, creating pre-ticketed F&B opportunities to complement movie promotions.
Q. How did movies like ‘Stree 2’ ensure that Hindi cinema to an extent continued its momentum though SRK, Salman Khan did not have a release?
‘Stree 2’ proved that exceptional content can sustain momentum of Hindi cinema, even without releases from superstar icons like SRK and Salman Khan. The film’s unique blend of humor, suspense, and relatable storytelling struck a chord with audiences nationwide. It showcased how a well-crafted narrative, brought to life on the big screen with premium visuals and sound, can draw in crowds and deliver a blockbuster. ‘Stree 2’ is a testament to the fact that in cinema, it’s not just the stars but the strength of the story and its execution that truly matter.
Q. In terms of regional cinema attendance did the momentum from 2023 continue?
Yes, the momentum for regional cinema attendance from 2023 has not only continued but strengthened in 2024. Mega-hits like ‘Pushpa 2’, ‘Kalki’, ‘Amaran’, and ‘GOAT’ have carried forward the excitement generated by 2023 blockbusters such as ‘Jailer’, ‘PS2’, ‘Adipurush’ and ‘Salaar Part 1’. Regional films have become a cornerstone of our box office success, consistently drawing diverse audiences and showcasing the unparalleled depth and appeal of regional storytelling across India.
Q. Did last year’s strikes affect Hollywood’s performance compared with 2023 in terms of the pipeline and revenue?
The Writers Guild of America (WGA), representing 11,500 screenwriters, and the American actors’ union SAG-AFTRA (Screen Actors Guild – American Federation of Television and Radio Artists), representing 160,000 media professionals and entertainers, went on strike over a labor dispute with the Alliance of Motion Picture and Television Producers (AMPTP). Both strikes lasted for nearly five months in 2023, causing the most significant disruption to the American film and television industries since the COVID-19 pandemic.
The strikes halted production on many movies and TV shows, preventing actors from promoting their projects. This had a noticeable impact on the movie pipeline, causing delays and pushing several high-profile releases into 2024 and beyond. The number of wide Hollywood releases in 2024 reduced significantly when compared to 2023. This led to a more limited box office slate, especially during key periods. For PVR INOX, which contributes 50%-70% of the Indian box office for Hollywood films, the reduced pipeline affected ticket sales, especially when compared to H1 of last year which had superhits like ‘Oppenheimer’, ‘Barbie’ and ‘Mission Impossible: Dead Reckoning part 1’.
Despite these challenges, Hollywood’s pipeline for 2025 is exceptionally strong, with major studios locking in key release dates for tentpole films. Audiences can look forward to an impressive lineup, including ‘Captain America: Brave New World’, ‘Fantastic Four’, ‘Superman: Legacy’, ‘Jurassic World: Rebirth’, Avatar 3: Fire and Ash, and the final installment of Mission Impossible. With four Disney releases and other notable titles, 2025 promises to deliver a resurgence in Hollywood content, creating tremendous opportunities for PVR INOX to further strengthen its leadership in showcasing premium international cinema.
Q. If you analyse market contributions what trends were seen between North, South, East and West for PVR Inox and the industry?
In 2024, regional trends in the cinema exhibition market showcased varying dynamics across North, South, East, and West India. The first half of the fiscal was muted, with occupancy levels showing softness across regions. However, South India emerged as the most resilient, driven by its vibrant local film industry and reduced dependence on Hindi and Hollywood films, which faced weak tailwinds this year. The trend of South Indian films finding pan-India success continued, with dubbed Hindi versions of blockbuster hits performing exceptionally well in Hindi-speaking regions.
The second half of the fiscal brought a marked recovery, with occupancy levels improving significantly. This resurgence was led by standout performances from films like ‘Bhool Bhulaiyaa 3’, ‘Singham Again’ and ‘Pushpa 2: The Rule’. A robust slate of upcoming releases—including ‘Mufasa: The Lion King’, ‘Baby John’, ‘Emergency’, ‘Skyforce’, ‘Game Changer’ and ‘Viduthalai Part 2’ is expected to sustain this momentum, further driving footfalls and reinforcing optimism for a strong year-end performance across all regions.
Q. Outside new releases one initiative done was re-releasing older films. How did this help the company and the industry cope with lean periods? How does the content curation process work in terms of deciding what to re-release and what to skip?
Re-releases have proven to be a highly successful strategy, with clear patterns emerging in terms of audience preference. Nostalgic Bollywood classics, such as ‘Rockstar’ and ‘Jab We Met’, have consistently drawn large crowds, highlighting a strong demand for iconic films that resonate with both new and returning audiences. Despite these movies being available on TV and streaming platforms, the allure of experiencing them on the big screen creates a unique excitement. It’s a fantastic way to bridge the gap between major new releases and keep the buzz alive.
The key to our success in curating these re-releases is knowing what our audience craves, films that not only stand the test of time but also offer something special in terms of experience. This strategy has not only helped us keep the momentum going but has also shown that cinema is more than just new content; it’s about celebrating great stories that never get old. And this is something we’ll definitely continue doing to keep the excitement at its peak.
Q. National Cinema Day fared well. Is the learning the fact that the industry needs to come together more often and collaborate?
National Cinema Day was a resounding success and highlighted the importance of collaboration within the cinema industry. At PVR INOX, we strongly believe that working together—across states, with studios, distributors, and exhibitors—creates a more unified and impactful experience for moviegoers.
Cinema is a shared celebration of storytelling, and when the entire industry comes together, it elevates the overall moviegoing experience, making it more accessible and enjoyable for audiences. This spirit of collaboration is key to fostering growth and ensuring that cinema continues to thrive as a vibrant form of entertainment for all.
Q. How is AI helping the cinema exhibition business? What tactics were seen in 2024 in this regard?
In 2024, PVR INOX embraced AI to revolutionise the moviegoing experience, particularly with the launch of Movie Jockey (MJ), an AI-powered chatbot on WhatsApp. MJ is a game-changer, offering movie lovers a seamless, personalised journey right from discovering films to booking tickets—all through a simple WhatsApp message.
This initiative not only makes the booking process easier but also provides added value through real-time support and secure payments, reflecting PVR INOX’s commitment to improving customer engagement and convenience in an increasingly digital world.
Q. Has there been any change in the revenue contribution between ticket sales, food and beverage, licensing and merchandising?
While the immediate revenue contribution across ticket sales, food and beverage (F&B), advertising, and other streams has remained relatively stable, F&B has shown a notable upward trend over the past decade. The Spend Per Head (SPH) on F&B as a percentage of Average Ticket Price (ATP) has nearly doubled, reaching 51% in FY24.
This steady growth reflects evolving consumer preferences and highlights the untapped potential in this category. With F&B revenues nearing Rs. 2,000 crores in FY24, PVR INOX’s scale places it among India’s top five QSR companies. Inspired by global cinema trends, particularly in the US, we see significant headroom for further growth and continue to prioritise this segment as a key driver of revenue diversification and enhanced customer experience.
Q. Which were the key towns and cities that were focussed on for launching more multiplexes this year and new multiplex formats like Laser XT IMAX?
Over the past 18 months, we have strategically expanded into smaller cities such as Machilipatnam, Dharwad, Cuddalore, and Patna, while maintaining a selective approach to new screen additions. Our growth model emphasizes expanding in South India, where multiplex penetration remains low, with 35%-40% of new screens planned in this region.
Premium formats like IMAX offer differentiated cinematic experience and have been a key focus area. Strategic location selection is critical, and 20 of our 25 IMAX screens are concentrated in key markets such as NCR, Mumbai, Bengaluru, and Chennai. Premiumization continues to be a cornerstone of our strategy, with 15% of our portfolio—262 screens—classified as premium. Notably, 111 of these premium screens were opened post-pandemic, comprising 24% of the new screens added since January 2021. This reflects our commitment to enhancing the cinematic experience and driving sustained growth through premium offerings.
Q. How do you see the cinema exhibition industry faring in 2025 in terms of the quantity of wide releases, good quality films that will help grow occupancy?
The cinema exhibition industry is poised for a robust 2025, with a packed slate of high-quality, wide releases across Hindi, English, and regional languages. This strong content pipeline is expected to drive a notable improvement in occupancies.
In Hindi, audiences can look forward to major releases like ‘Chhava’, ‘Sikandar, Raid 2’, ‘War 2’, ‘Housefull 5’, ‘Emergency’ and ‘Welcome to the Jungle’. Hollywood brings an impressive lineup, including ‘Captain America: Brave New World’, ‘Mission Impossible: Dead Reckoning Part 2’, ‘Jurassic World – Rebirth’, ‘Avatar 3’, ‘Superman Legacy’ and ‘Fantastic Four: The First Steps’. Regional cinema remains a significant driver, with notable titles like ‘Game Changer’ (Telugu), ‘Kantara Prequel’ (Kannada), ‘Coolie’ (Tamil), ‘Sardarji 3’ (Punjabi) and ‘Vishwambhara’ (Telugu) set to captivate audiences.
With such a diverse and exciting array of films, 2025 is set to be a landmark year for the industry, reinforcing its momentum and paving the way for sustained growth in footfalls and occupancy levels.
