Key Financial Performance (Q1 FY27)

Operational Metrics:

  • Total footfalls (admissions) were 36.6 million, an increase of 8% year-on-year (YoY).
  • Average Ticket Price (ATP) reached INR273, an increase of 8% YoY.
  • Spend Per Head (SPH) on Food & Beverage (F&B) was INR161, an increase of 9% YoY.

Financial Figures (Ind AS 116 Adjusted Basis):

  • Revenue stood at INR1,642 crores, reflecting a 12% growth YoY.
  • EBITDA was INR230 crores, nearly doubling from the previous year's quarter.
  • EBITDA margin expanded to 14%.
  • Profit After Tax (PAT) was INR71 crores, compared to a loss of INR34 crores in Q1 FY26.

Balance Sheet & Cash Flow:

  • The company achieved a net cash positive position of INR80 crores as of June 30, 2026.
  • This follows three years of sustained free cash flow generation and disciplined capital allocation.

Business and Strategic Updates

Screen Expansion:

  • Management guidance remains to open around 100 screens in FY27.
  • Openings were bunched up for Q2 and Q3 due to delays in receiving regulatory licenses for screens that had completed fit-out.
  • The net screen addition for FY27 is expected to be approximately 80, after accounting for closures.
  • Most closures (loss-making screens over 18-20 years old) occurred in Q1, with very few expected for the rest of the year.

Capital Expenditure (Capex):

  • The capex estimate for FY27 has been revised downwards to approximately INR350 crores from the earlier INR400 crores.
  • This reduction is attributed to a stronger-than-expected response for the capital-light (FOCO) model.
  • The capex will also cover the prioritization of renovating a few high-value properties.

Growth Strategy & Diversification:

  • The company continues to focus on a capital-light FOCO (Franchise Owned Company Operated) model for expansion, particularly in Tier 2 and Tier 3 cities.
  • A long-term target of adding 1,000 new screens over the next 5 years was mentioned.
  • Diversification beyond films includes live streaming of sporting events (IPL, FIFA World Cup 2026), concerts, live events, and curated re-releases.
  • The live streaming of the FIFA World Cup 2026 final attracted 64,000 guests with an ATP of approximately INR380-400.
  • The company is exploring other out-of-home entertainment formats to utilize its 15 million square feet of leased space.

Joint Venture Update:

  • The food court joint venture with Devyani International Limited is ongoing, with 3 outlets opened and more in the pipeline.
  • Investments in this JV are part of the overall INR350 crore capex and are not considered material at the company level.

Content and Market Performance

Q1 FY27 Content Mix:

  • The quarter saw strong performance across languages without a single INR500 crore+ blockbuster, indicating a diversified and healthy content slate.
  • Successful Hindi titles included Bhoot Bangla, Cocktail 2, and Main Vaapas Aaunga.
  • Hollywood performed well with non-franchise titles like Project Hail Mary, Michael, and Obsession.
  • Regional cinema delivered multifold growth with titles like Raja Shivaji (Marathi), Drishyam 3 (Malayalam), and Karuppu (Tamil).
  • The company's market share for Hollywood films is approximately 60% overall, reaching 80-90% for mid and smaller films.

Upcoming Content Slate:

  • The pipeline for the remainder of FY27 is strong, featuring major Hindi titles (Ramayana Part 1, King, Love and War), regional films (Jana Nayagan, Toxic, Jailer 2), and Hollywood tentpoles (Avengers: Doomsday, Spider-Man: Brand New Day, Dune: Part Three).

Cost Management and Profitability

Film Hire Costs:

  • Film hire cost as a percentage of revenue decreased by approximately 200 basis points YoY in Q1.
  • This was attributed to the content mix, including more films in their third/fourth week (which have lower revenue share terms) and the absence of mega-blockbusters that trigger bonus payouts.
  • The company expects the full-year film hire cost to be in the range of 45% to 45.5%.

F&B Cost of Goods Sold (COGS):

  • F&B COGS as a percentage of revenue also decreased by ~200 bps YoY due to continued focus on cost control, reducing wastage, using technology, and a wider product offering driving higher offtake.
  • A further reduction in full-year F&B COGS is expected compared to last year.

Other Revenue Streams

Advertising:

  • Advertising revenue is growing but is expected to take another year to surpass pre-COVID levels.
  • Growth is tied to big blockbuster films, and the company is working to shift advertiser focus towards eyeballs rather than specific films.

Convenience Fee:

  • Online ticketing penetration increased to 69% in Q1, driving a 29% YoY growth in convenience fee income.
  • Growth was driven by content mix, marketing programs, and increased admits/ATP. Management expects the rate of penetration growth to slow from these high levels.

Web & App Monetization:

  • A new digital advertising initiative on the company's web and app platforms was launched a month prior to the call.
  • Annualized revenue from this stream is estimated to be in the range of INR2-3 crores initially.

Alternate Content Programming:

  • Alternate content, such as live events, achieved an ATP of INR409.
  • Content costs for these events vary widely, ranging from 35% to 70% of the ticket price, depending on the artist and event negotiation.

Capital Allocation and Shareholder Returns

  • The primary focus for capital allocation is on driving sustainable growth and improving Return on Capital Employed (ROCE) and Return on Equity (ROE).
  • The company is evaluating all options for the use of its net cash position, including growth investments and potential shareholder returns.
  • Any decision on instruments like a buyback would be taken by the Board and disclosed at an appropriate time.