Multiplex stocks head north on record boxoffice run

Riding high over half a dozen boxoffice hits in the first half of this financial year, multiplex companies Shringar Cinemas, Adlabs, PVR Films and Inox are expected to post handsome results in the second quarter, according to analysts.

Of 53 films released this year, six have been superhits, with Rakesh Roshan's Krissh being the top collector, followed by Rang De Basanti, Fanaa, Phir Hera Pheri, Kabhi Alvida Na Kahena and highly-discussed Gandhigiri-fame Lagey Raho Munnabhai. Of this, three films were released this quarter.

"These companies will see higher Q2 results, as some films did well and also with the multiplex culture gaining ground in cities. But as some companies are also into businesses other than film exhibition, these sectors will also contribute heavily to their performance," Phani Sekhar, analyst with Angel Broking, said.

For the second quarter ended September 30, shares of Shringar Cinemas ended higher by 25 per cent to Rs 49, while PVR Cinemas rose from Rs 218 to Rs 255, a gain of about 17 per cent. INOX rose by 21.6 per cent to Rs 155. Adlabs was the biggest gainer at 40 per cent to Rs 356.

Besides, five super hits, Bollywood saw 10-12 films raking it big at the the boxoffice. However, 16 films were washouts, while another 17 films finished in the red.

"The industry has been going through a lean patch over the last few years. But this year, things were better. Quality content has been main reason for this.," film critic Taran Adarsh said.

Phani Sekhar said since it was tough to predict whether the industry would churn out similar hits next quarter, these companies were following an integrated business model.

"The recent successes cannot be attributed merely to quality of content. In fact, superior marketing was key to their success. Most multiplex majors are on an expansion drive and are expected to increase their capacity by almost 200 per cent by 2008," he added.

Adlabs, which is also into film distribution, registered a profit of Rs 12.06 crore last quarter, while Shringar, also following an integrated model, made a profit of Rs 1.25 crore at the end of the first quarter. The Delhi-based PVR Films' Q1 profit was Rs 3.33 crore against Inox's Rs 8.37 crore.