A key priority for PVR-Inox currently is improving margins through better capital and operating expenses, says managing

director Ajay Bijli.

The merger of PVR and INOX has created a multiplex behemoth with 1,650 plus screens across 350 plus properties in more
than 110 cities.

What was the rationale behind the merger?

Big companies worldwide have around 4000-5000 screens.

It's challenging to achieve that level of scale in India due to the late start of the multiplex journey. The first multiplex only
opened in 1997 in New Delhi. Then one leg of our business is joined at the hip with shopping centres and mall development,
which also took time to develop due to the lack of organised retail in India.

PVR (words by MD))

Organically, we were growing by 40–60 screens a year, but then we started acquiring other companies like Cinemax and DT
to further expand our reach. But then the pandemic hit. But as Winston Churchill said, we should never waste a good crisis.
Though no crisis is good; it completely devastated our balance sheets and business.
And the only way to make our balance sheet stronger and address the challenges we faced was through the merger.

Now we are looking at synergies in every revenue line, and we have launched a new initiative called Parikrama. This 100-
day initiative involves examining every line of revenue to identify opportunities for improvement.

Currently, our main priority is improving our margins through better CapEx and OpEx. We believe it's essential to stimulate
consumer demand. There is a segment—45 and up—that is taking time to come to cinemas. They are very movie-driven.
Also on the supply side, the film industry has to rev up. In 2019—20, 1900 films went through the system; now we are down
to 1100–1200. We need to have more movies that connect with the audience

PVR and INOX promoters would own 10.6% and 16.9% of PVR-INOX, respectively.

Has occupancy reached pre-Covid levels? Will the higher ticket pricing hold after the COVID bump subsides?
It depends on which region you are talking about. If you talk about the South, the answer is yes. If you talk about the West,
North, and East, no, it hasn't reached the pre-Covid levels. We do think the ticket prices will hold. They haven't gone up by
that much; it’s less than inflation in a 3-year period. So, inflation was 7% and we grew by 5% a year. By the way, minimum
wages have gone up, electricity has gone up, and all input costs have gone up. So, we have stayed below inflation. So going
up by 16% is still below inflation for a three-year period.

Can you take us through how the deal finally materialised?

This deal happened, as I said, because of COVID. I think everybody was in touch with each other because our backs were
against the wall. For 18 months, we had zero revenues. We didn’t know if we would survive. It just became very obvious
that if we came together, we could build a business. It just made sense.
So there were plenty of intermediaries who also felt that if the two came together, the balance sheet would become stronger
and all the benefits of scale would accrue. So, we had to forget about our respective holdings. In a listed company, you have
to look at the interests of all the shareholders. My stake (Ajay Bijli) in PVR was 17% even before the merger; now it is about
(His total family) 11%. The Jain family's post-merger share is about 17%. Perhaps if COVID hadn’t happened, it would not
have happened.

Wasn’t diluting your stake to raise money an option instead of a merger?

It wasn’t that easy. Our stock had come down to around Rs 700-800 during COVID. We had done a QIP to raise funds,
followed by another Rs 300 crore rights issue. Post that business didn't pick up again. We had no revenues for 18 months.
The merger looked like a sensible decision to take.

SHARE PRICES LAST AVAILABLE –

INOX as on 28th March (last available date) = INR 548

PVR as on 28th March = INR 1480

PVR INOX TODAY = INR1750

SHAREHOLDING TODAY In PVRINOX CINEMANS

HUF (BIJLI FAMILY)

GFL LIMITED (Owner is inox leasing and finance ltd)

PVR INOX PVR INOX

HUF (BIJLI FAMILY) 11.30 17
GFL ltd 16.16 43.15
PUBLIC 12.4

SHARE SWAP ratio

INOX share was merged into PVR and INOX was delisted

SHARE SWAP ratio was 10:3

For 10 shares of INOX public would get 3 shares of INOX PVR.