‘We are positioning PVR as a lifestyle entertainment firm’

PVR, India’s largest theatre operator, recently acquired DT Cinemas from DLF to expand its business in the North. Nitin Sood, chief financial officer at PVR, talked to Vivek Seal about the acquisition and other expansion plans. Excerpts:

Can you explain the rationale behind the deal with DLF?
Broadly, if you see the idea, it is to further expand our footprint and increase our presence in the multiplex space. DT Cinemas is largely present in northern India, which is a great circuit where we are still the market leader, so the idea behind this acquisition was to increase further our footprint.  Delhi, being a profitable market, really helps us in the ongoing business as the properties we acquired were in prime locations. The branding of DT Cinemas to PVR would happen in the next few months.

So what marketshare you will have in multiplexes?
We will have about 60-70% marketshare in multiplexes in Delhi and Gurgaon region.

What kind of occupancy are you experiencing?
Occupancies have stabilised after the bad first quarter because of the dispute. In the second quarter, occupancies were in the region of 33-35%. This quarter, it is looking fairly good and would be in the similar range or maybe, slightly higher, looking at the content pipeline. The general trend is that local content contributes about 97% of revenues and Hollywood contributes about 3%. In our businesses in multiplexes, the ratio would be in the range of 80:20.

Any alliance we can expect with movie-makers?
As an exhibitor we do not make any alliances, because we play every film.

How many screens do you have now, and what are your expansion plans?
We have a total of 108 screens on our own and have recently acquired 29 screens. About 40-45% of our screens are in northern India, about 35% are in western India while the rest are in the South. Our growth will happen pan-India, we are opening a project each in Chennai, Ahmedabad, Allahabad and have some projects in the NCR and Surat. We want to be the dominant player in whichever market we enter and not just open one cinema hall in the region.

What are your expectations on ticket prices, will they go up?
Prices have already moved up considerably — as against an average ticket price of Rs 130-133 last year, the average price has gone up to Rs 150 now, so that is a more than 10% growth. So we expect prices to remain stable this year.

How is your BlueO bowling business performing?
We just have one centre now in the Gurgaon region, which is 24 lanes and is doing pretty well. We are operating it at 30% operating margin. From expansion perspective, what we are trying to do is that in our all future cinema halls, we are planning to introduce these concepts in mall development in areas such as Delhi, Pune and Bangalore etc. We are also positioning PVR as a lifestyle entertainment company, which will have presence in other retail entertainment formats in mall developments outside of cinemas.