Motilal Oswal: Sharp Cost Measures Cushion PVR’s Q1 Loss; Status Of Reopening Remains Unclear
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Motilal Oswal Report
PVR Ltd.’s Q1 FY21 operating loss of Rs 1.3 billion (versus estimate Rs 2.1 billion) was better than expected, driven by sharp cost-cutting measures.
Operating expenses are expected to further decline by approximately 30% QoQ in Q2 FY21, driven by the rationalization of employee expenses.
We expect the remainder of H1 FY21 to remain a total washout due to Covid-19 and anticipate continued weak capacity due to social distancing measures.
Hence, we expect profitability to return only by FY22E.
We estimate FY22E revenue/Ebitda at Rs 37.4 billion/Rs 6.2 billion (at 9%/7% over FY20E) with the return of stability and some capacity additions.
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