Inox Leisure continued to report losses as footfalls and revenues remained well below pre-Covid numbers owing to lack of steady flow of new releases (especially in Hindi language). Revenue was at 90.4%, down 75.7% YoY. EBITDA loss (ex-Ind AS116) came in at ~Rs. 89 crore. Inox recognised Rs. 26.3 crore as rent concessions and other income of Rs. 23.8 crore from settlement of old claims. Subsequently, the company reported net loss (ex-Ind AS116) at Rs. 74 crore. On a reported basis, net loss was at Rs. 93.7 crore.
Valuation & Outlook
While a few successful releases in regional languages along with vaccination drive was expected to initiate recovery, absence of Hindi releases delayed the same. Considering the prevailing Covid-19 second wave, we believe cinemas will see normalised scenario only from H2FY22 onwards. Long term benefit of some single screen closure is also possible (management expects ~8-10% of the overall screen base of 8600-8700 screen to shut down due to Covid pain). However, uncertainty of post Covid behaviour remains. We maintain HOLD rating on the stock considering the delayed recovery prospects. We value the stock at 10x FY23E (ex-Ind-AS) EV/EBITDA with a target price of Rs. 275/share (earlier TP: Rs. 350/share).
For details, click on the link below: https://www.icicidirect.com/mailimages/IDirect_Inox_Q4FY21.pdf
Shares of INOX LEISURE LTD. was last trading in BSE at Rs.271.55 as compared to the previous close of Rs. 276.3. The total number of shares traded during the day was 39305 in over 1251 trades.
The stock hit an intraday high of Rs. 274 and intraday low of 269. The net turnover during the day was Rs. 10699584.