Inox Leisure - Q4FY20 First Cut - ICICI Securities

CMP - Rs. 283, Market Cap - Rs. 2911 crore

Inox reported a weak set of numbers for Q4FY20. Operating performance was above estimates due to lower than expected rental charges. However, profitability was impacted due to deferred tax assets write-off on account of shifting to new tax rate. On YoY basis, revenues were much lower due to weak content from February onwards and shutdown from mid-March on account of Covid-19.

Q4FY20 Earnings Summary

- Reported revenue came in at Rs. 371.6 crore (22.4% YoY de-growth), slightly ahead of our estimates of Rs. 360.9 crore. Footfalls declined ~29% YoY to ~13 mn, in line with estimates. We await further details on box office, F&B and ad revenues

- EBITDA (without impact of Ind AS116) came in at Rs. 34.9 crore, above our estimates of Rs. 32 crore. Margins of 9.4%, down 1077 bps YoY, were ahead of our estimates of 8.9%. On reported basis, EBITDA was at Rs. 110 crore, margins of 29.6%, better than our estimates of 24% with EBITDA of Rs. 86.7 crore. EBITDA was better on account of lower than expected rental charges

- Inox re-measured its deferred tax assets and has taken a write-off of Rs. 68.9 crore while shifting to new tax rate. Subsequently, the company reported net loss (without impact of Ind AS116) at Rs. 2.5 crore. On reported basis, net loss was at Rs. 82.2 crore (estimated loss: Rs. 12.7 crore)

- Inox' performance in Q4 remained weak due to Covid-19 outbreak in March and theatres remained shut through the entire Q1FY21. Inox has a relatively stronger position on the liquidity front, which is a positive in a prolonged lockdown scenario. We will come out with an update soon post conference call where we seek management commentary on the outlook ahead.

Shares of INOX LEISURE LTD. was last trading in BSE at Rs.283 as compared to the previous close of Rs. 288.45. The total number of shares traded during the day was 150190 in over 5574 trades.

The stock hit an intraday high of Rs. 317.75 and intraday low of 275. The net turnover during the day was Rs. 44734426.

Source : Equity Bulls

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