Elara: PVR INOX Q3 strong on films, but long-term recovery remains patchy

• PVR INOX's Q3 performance is expected to improve due to the festive season and major film releases like Dhurandhar and Avatar, potentially boosting stock.
• Despite short-term gains, Elara Capital notes PVR INOX's long-term recovery remains inconsistent, requiring sustained box-office hits for a re-rating.
• The company is diversifying with expanded F&B and lifestyle formats to reduce reliance on theatrical revenue, though scaling these initiatives presents challenges.
• The South Indian market is a key positive, showing better post-pandemic occupancies driven by successful franchise-led content.
• PVR INOX reported a net profit of Rs 106 crore in Q2 FY25, a significant turnaround from a previous loss, with revenue up 12.4% and EBITDA up 27.7%.

Why It Matters: This impacts PVR INOX's stock and future business prospects.