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India's largest multiplex chain PVR Cinemas mentioned that the share of regional cinema as part of gross box office contribution has increased significantly from pre-pandemic levels.

For the September quarter, regional cinema contributed to nearly half of the gross box office collection, compared to the September quarter of the financial year 2020, where it contributed only 28 percent. On the other hand, the share of Hindi movies has declined to 38 percent in the current quarter, from 48 percent pre-pandemic.

Films in southern India have done phenomenally well, Ajay Bijli, CMD of PVR told CNBC-TV18 in an interview. 40 percent of PVR's 864 screens are in the southern part of the country.

The Bollywood Disappointment

The Hindi film industry's bad form continued in the September quarter with films like Laal Singh Chaddha, Raksha Bandhan, Liger turning out to be box office duds. Brahmastra turned out to be the highest-grossing Hindi film for PVR post-pandemic, with a box office contribution of 19 percent.

PVR attributed the underperformance of Hindi films to a variety of reasons like pre-pandemic content not resonating with audiences, quality of content driving performance instead of star presence, and negative social media against certain Bollywood movies and stars.

Hollywood too struggles

Box office collections for Hollywood films nearly halved during the quarter and the quarter turned out to be the weakest globally in nearly two decades. The underperformance of Hindi and Hollywood films impacted admissions and average ticket prices during the quarter, according to PVR.

Earnings Picture

For the September quarter, PVR reported revenue of Rs 686 crore, higher than Elara Capital's estimates of Rs 652 crore. The company returned to profitability on the operational front with an EBITDA of Rs 154 crore, compared to an EBITDA loss of Rs 68 crore last year. Even as the company remained loss-making during the quarter, the net loss halved to Rs 71 crore, from a loss of Rs 153 crore during the same period last year. Elara Capital had estimated a net loss of Rs 136 crore.

The company's borrowings have remained flat during the quarter compared to the March quarter at Rs 1,045 crore.

PVR has maintained its guidance of opening 110-125 screens in the current financial year. The company opened 14 screens during the quarter, taking the total count to 24 in the first six months of the year. Based on its guidance, the company will have to open at least 90-100 screens during the year's second half to meet its guidance.

Last month, investors of PVR had offloaded 9 percent stake in the company. Sources told CNBC-TV18 that multiple Private Equity Investors had sold stake. The management spoke about the fact that there were two PE funds who had pared stake last month and would be looking at an exit over the next 12-15 months.

Shareholders of PVR recently approved the merger with Inox Leisure, paving the way for the creation of a film exhibition network worth over 1,500 screens. The management expects the NCLT process to be completed within the next 3-4 months.