Analysts at IDBI Capital expect more states to take this precautionary step which is likely to have a significant impact on the January-March quarter (Q4FY20) result. Further, spill-over of closures of cinemas to Q1FY21 remains an important monitorable. The brokerage firm sees the probability of April 2020 to be hit.
PVR is among the top multiplex operators in India with significant presence in premium malls. It will be impacted in 4QFY20E and 1HFY21E as footfalls recede. To factor this in, we cut our footfalls by 4 per cent/9 per cent and adjusted EBITDA by 8 per cent/15 per cent for FY20E/FY21E, according to analysts at KIM ENG Securities.
The brokerage firm believes the impact of Covid- 19 will be limited to the short term, and the long-term fundamentals and the growth story of PVRL are unaffected. Risk from slump in high-margin ad revenue, but we assume this won’t change.