What’s with PVR adding 100 screens?

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Anybody else more or less stopped going to the movies? Asked one of my friends in our recent get-together.

And why not? A night out at the movies can get very costly, especially, if you factor in parking, popcorn, and the rising prices of movie tickets. It all adds up, and many prefer watching movies and TV shows at home, cozied into their blankets. It’s less expensive and super convenient to just Netflix and Chill ❤️.

One could easily do the math and say theatres are done. Gone are the days of ‘Sholay’ and ‘Dilwale Dulhaniya Le Jaenge’ creating houseful for years. A movie these days struggles to stay on the list for more than 3 weeks. This also explains why PVR INOX, India’s largest cinema chain with 356 locations across 111 cities in India and Sri Lanka, has difficulty filling seats. Its occupancy rate stands at a mere 25-26% today.

But here’s the twist 🙆🏻‍♂️

Despite low occupancy, PVR plans to add 100 more screens and amplify the occupancy to 29-30% by ‘26.

That sounds strange. What’s their game plan here? Let’s find out 👇

Strategy 1: Finding Crouching Tiger, Hidden Dragon

Even today, blockbusters pull people to the movies, especially, Diwali, Eid, and holiday seasons.

Released on this Diwali, the star-packed Singham Again collected 248 crore, whereas Bhool Bhulaiya 3 collected 247 crore in Nov ’24. December also has a great line-up of movies, such as Pushpa 2, Mufasa: The Lion King, and Baby John. These are good months for PVR.

However, not all weekends will have blockbuster releases. PVR INOX has a backup plan for this.

It’s called re-releases.

PVR is curating ‘movies from the past with great potential’ and doing re-releases in their theatres. From the first such pilot, it looks like the plan is working. Their first re-release of Tumbbad (a must-watch, if you haven’t seen it!) raked in 7 crore at the box office in just 3 days.

PVR has promoted 80 film re-releases by Sep’25 and plans to increase the total to 140 by the end of FY25.

Strategy 2: Experiences Beyond the Cinema

PVR INOX is in the experience business—a large screen, excellent sound, comfortable recliners, and something worth talking to friends about. 

If you remove the movie from the setting, there’s another experience that fits into the environment perfectly - Sports.

Earlier this year, PVR INOX partnered with Star Sports Network to screen the ICC Men’s T20 World Cup 2024. On Nov 10, they also held a live screening of the Chelsea vs Arsenal match. Their collaboration with Star Sports also includes live screenings of Premier League football matches in theaters across major cities such as Delhi, Mumbai, Pune, Kochi, Kolkata, and Guwahati. PVR is relying on high-energy sports matches, whether cricket or football, to attract more audiences to their theatres.

Strategy 3: Moving from Fixed Costs to Revenue Sharing Models

Until COVID-19, theatres in India paid real estate developers a fixed minimum guarantee (MG) or a mix of MG and a revenue share.

However, this trend is changing fast now. Theatres bring 30% to 40% of the footfall into the malls while occupying around 30% of the mall space. People usually club their movie experience with shopping and eating out before or after. Plus, most of the theatres operate on the top floors, which is not suitable for many retail brands. Meaning, if not theatres, there are limited options that the developers can move to.

PVR INOX aims to use its market monopoly to move towards an asset-light model where the agreements with developers are on a revenue-sharing basis only.

Fighting Netflix by becoming more like Netflix

This section is more of a prediction from my side.

Large theatre chains like AMC and Regal Cinemas are fighting back against Netflix and other streaming apps with monthly subscription plans (very similar to streaming apps). Plans varying from unlimited to 3 movies per week with options to choose the format such as 2D, 3D, and IMAX 3D are offered. They also have an app where users can book tickets, select seats, and pre-order the food. It all takes the same time one spends discovering what to watch on OTTs.

PVR has recently launched Movie Jockey(MJ), an AI-powered Whatsapp chatbot that assists in movie discovery and booking. With multilingual support, MJ aims to send personalized movie recommendations and provide all movie-related and accessibility-related information such as wheelchair accessibility, and subtitle availability to users.

In the coming time, PVR might also follow suit by offering INOX passes to movie enthusiasts similar to the large theatre chains in the West. Once they have direct access to customer analytics, PVR can also partner with other experience-based events such as comedy shows, water parks, and adventure islands in the coming time.

It’ll be interesting to see how PVR INOX plays its cards in the world of streaming and regains profitability.

Until next time! 👋

Saurabh