PVR Inox stock rises 3% after Anand Rathi raises target price, sees 25% upside

Shares of PVR Inox Ltd. gained nearly 3 per cent after brokerage firm Anand Rathi released a note on the company, reaffirming a 'buy' rating with a target price of ₹2,065 per share. This target suggests a potential upside of 25 per cent from the stock's previous closing price of ₹1,655.

“We introduce FY27e and retain our Buy with a raised TP of Rs2,065 (13x FY27e pre-Ind-AS EBITDA),” the brokerage firm said in a note.

The brokerage anticipates a sequential improvement in the second quarter of fiscal 2025 following a lackluster first quarter, driven by enhanced advertising revenue, which has been trailing behind pre-COVID levels.

What's behind the rally?

Several major films, including Kalki 2898 AD, Stree 2, Deadpool & Wolverine, and Raayan, are expected to drive strong revenue in Q2, according to the report. The third quarter is projected to be the company's most successful, featuring franchise films such as Pushpa 2, Singham Returns, Sitaare Zameen Par, and Bhool Bhulaiyaa 3 at the forefront.

“After a muted Q1, PVR Inox is set for sequential improvement from Q2FY25. Plus, advertising income, which has been lagging pre-Covid levels should get a boost. Ahead, Q3FY25 is expected to be a good quarter for PVR-Inox, backed by many franchise movies. PVR’s Q3 performance may surpass its best quarter, Q2 FY24, (release of Gadar- 2, OMG-2 and Oppenheimer),” the firm added.

PVR Inox aims to add 110-120 gross screens in fiscal 2025, targeting net additions of approximately 50-60 screens while continuing its efforts to reduce debt and implement an asset-light model.

During the trading day, PVR Inox shares rose by as much as 2.96 per cent, reaching ₹1,704.15 on the NSE. As of 1:46 p.m., the stock was trading 2.51 per cent higher at ₹1,696.65, compared to a 0.23 per cent increase in the benchmark Nifty 50 index.

Over the past year, the stock has declined by 1 per cent but has gained 2.05 per cent year-to-date. The total trading volume for the day was 2.2 times its 30-day average, with a relative strength index of 75.97.