PVR INOX Ltd (NSE: PVRINOX) Q1 2026 Earnings Call dated Aug. 06, 2025
Corporate Participants:
Unidentified Speaker
Ajay Bijli — Managing Director
Gautam Dutta — Chief Executive Officer, Revenue & Operations
Gaurav Sharma — Chief Financial Officer
Analysts:
Unidentified Participant
Abhisek Banerjee — Analyst
Abneesh Roy — Analyst
Vaibhav Muley — Analyst
Jayram Shetty — Analyst
Kavish Parekh — Analyst
Umang Mehta — Analyst
Jinesh Joshi — Analyst
Harit Kapoor — Analyst
Presentation:
operator
Ladies and gentlemen, good evening and I welcome you all to the PVR INOX Q1 FY26 earnings call. As a reminder, all participant lines will be in lesson only mode. And there will be an opportunity for you to ask questions after the presentation concludes. Should you need assistance during the conference call please signal an operator by pressing Star then zero on your touchstone phone. Please note that this conference is being recorded. I now hand the conference over to Mr. Abhishek Banerjee from ICICI Securities. Thank you. And over to you, sir.
Abhisek Banerjee — Analyst
Good afternoon everyone. On behalf of ICICI Securities I would like to welcome you to the Q1FY26 earnings conference call for PVR Inox Limited. Representing the company, we have Mr. Ajay Witchery, Managing Director, Mr. Sanjeev Kumar, Executive Director, Mr. Gaurav Sharma, Chief Financial Officer and other senior management personnel. The call will begin with brief management remarks followed by a Q and A section. I would now like to hand over. The call to Mr. Birji for his opening remarks. Over to you, sir.
Ajay Bijli — Managing Director
Thank you very much, Abhishek. Good evening everyone. Like to invite you all to discuss the unaudited results for the quarter ending June 30, 2025. We uploaded the earnings presentation and the results on our companies and stock exchanges websites earlier today and I hope you had a chance to review them. The Indian box office has started on a strong note in FY26. Led by robust performances from both Bollywood and Hollywood movies. Bollywood box office collections surged by 38% year on year driven by a steady flow of successful titles such as Raid 2, Sitara Zamipat, Case 3, Chapter 2, Household 5 and Jat.
The year so far has relied less on the big ticket blockbusters and more on a consistently performing steady flow of films. With five Hindi films crossing the 100 crore mark including three films which cross the 200 crore mark. This signals a healthier theatrical environment where performances are less skewed by mega blockbusters and more anchored in the sustained strength of mid to high performing title Hollywood movies. Two, where PVR Inox enjoyed the dominant market share delivered a sharp 72% year on year growth in collections powered by super hit franchises like Mission Impossible, Final Destination and Ballerina.
The major summer event films like F1, inspired by the world of Formula 1 also stood out with its high octane racing action placing it among India’s top performing Hollywood releases. For this period. These titles performed exceptionally well in our premium and experiential formats which recorded an impressive 20% year on year growth in admissions. On the other hand, regional content demonstrated stability. Regional performance was well supported by hits like Good Bad Ugly in Tamil, Kadaram in Malayalam and Sleeper Hitchhike Tourist Family in Tamil. We continue to focus on our manufacturing footfalls initiatives to drive demand generation.
In April we launched Blockbuster Tuesdays offering tickets starting at just 99 rupees which has quickly emerged as a very high impact footfall driver for value conscious weekday patrons. Impressively, it brought nearly 1 million new and lapsed transactors back to cinemas, highlighting its effectiveness and revitalizing weekday cinema going habits. Our live events initiative also progressed well with screenings of IPL matches which drew enthusiastic crowds and showcased how cinema halls can be multipurpose entertainment venues. While these initiatives deliver strong engagement, the quarter also saw some external disruptions and the release of films like Akan and the indefinite suspension of Sadharji 3 collectively impacted footfalls resulting in a loss of nearly 6 to 7 lakh admissions.
All key operating metrics registered strong year on year growth. Admissions rose by 12% to 34 million while average ticket price increased by 8% to $2.54. We also achieved our highest ever spend per head on SMB PER at 148 rupees reflecting a 10% year on year growth. Advertising revenue reached 110 crores, the highest for any quarter post pandemic, marking a 17% increase over the previous year. In terms of the financial results for the quarter, the following numbers were calculated after adjusting for the impact of India’s 116 on lease accounting. Total revenue for the quarter was 1488 crores, EBITDA was 114 crores and pack loss was 34 crores compared to revenue of 1209 crores, EBITDA loss of 20 crores and pack loss of 137 crores in the same period last year.
On growth investment front, we are actively implementing the capital light growth strategy. During the quarter we opened a total of 20 new screens of which 14 were under asset light and focal models. In addition, we have signed 55 new screens under the FOCO model and 72 new screens under the asset light model, reinforcing our focus on capital efficiency and scalable expansion. During the quarter we have not closed any screens. Our net Debt stands at 892 crores at the end of June 2025, marking a reduction of 61 crores since March 2025 at an impressive 539 crores or 38% reduction since the merger.
Underscoring our commitment on financial discipline and deleveraging, the upcoming quarters look promising with a robust lineup of releases across languages. Key titles include Ward 2, Kuli, Jolly, LLB 3, IkesThama, Tere, Ishkme, Durandar, Avatar, Firehanash, Rajasad, Alpha, Body 2, Love and More and Toxic. With such a diverse and high potential content slate lined up, we expect strong audience traction and healthy footfalls in the quarters ahead. We will continue our efforts towards manufacturing footfalls through innovative promotions and programming while prudently managing cash flows and reducing leverage. Our current screen Portfolio stands at 1745 screens across 353 cinemas in 111 cities in India Sri Lanka.
Thank you for joining us today. I now open the floor for any questions you may have.
Questions and Answers:
operator
Thank you very much. We will now begin the question and answer session. Anyone who wishes to ask a question may press Star and one on their touchstone telephone. If you wish to remove yourself from the question queue, you may press Star and two participants are requested to use handsets while asking a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The first question is from the line of Abneesh Roy from Nuama. Please go ahead.
Abneesh Roy
Yeah, thanks. My first question is on the focal and effect light model. So you have opened around 14 screens in these two models this quarter. If you could comment, what was the response? And if you could also comment on the FY25 scene openings, if any in this model. Any tweaks are needed in terms of expansion. And are you happy with the initial response in these two satellite and poker models?
Ajay Bijli
Yeah. Hi, this is Ajit Bizhy. Abnesh. Yes, I mean out of the 20 screens that we’ve opened, you know Raipur is on focal model, Javalpur is on Foco model and also Director’s cut in Mall of India DLS project in Noida is an asset light model and we are extremely happy because we are not compromising on any of the things that we look at when we do a normal lease model, even when we are doing these models because in fact our responsibility increases to make sure that these projects are successful and quality of the operations, quality of the fit outs are equally good and the response even from the developers and those who invested money in the poker model is also very good.
So I think as mentioned in my opening speech or whatever talk, 127 screens have already been signed and we’re going to be opening these screens in the next, in this financial year and the next financial year 18 to 24 months. This is obviously the EBITDA margins are going to be same as what we normally look at. But the roc because the contribution is less from our side and more from developers, the ROC numbers are much healthier and it’s part of our strategy to sweat the brand now which is recognized by all stakeholders, especially the developers and the consumers.
That you know, much as the way it has been done in hospitality for a long time. But I think it’s the first time a cinema company has basically gone on this path and we’re very happy with the results.
Abneesh Roy
Sure. My second question is on your manufacturing footballs initiative, Tuesday 99 pricing seems to have done well. Now weekend customer and weekday customer generally is a bit different because of the nature of the job profile etc. So does it make sense to extend Tuesday to bit more weekdays? And second question is on the FNB side also you have done affordable pricing. Any numbers you can share that on a percentage basis conversion of the occupancy. How can we judge that this is also working? Because in India anything affordable always works. Just want to understand if any data points you can share how it’s working.
Ajay Bijli
So is it okay Ravnesh if I give the answer to request Gautam to answer this? Yeah, Gautam, can you answer this please?
Gautam Dutta
Yeah, sure. So your question on whether this affordable pricing is working, the first answer is that if you look at our 10% growth, the majority of the growth is coming through value and not through volume, which is very healthy in the sense we are able to take the strike rates up by converting some of our non eating consumers on the weekday through the 99 plan and through the unlimited refill, a promotion that we run over the weekend. We try sort of to cover a larger audience through that. So by and large there’s been a very focused approach on trying to get more conversions to the candy as well as keep the pricing up there.
So the split between on the growth is 50, 50 or 6040 in favor of volume to value and that shows clearly that this is working. So that was. And what was your first question on whether we can extend the pricing to weekend? No, we don’t want to do that.
Abneesh Roy
No, that was not the question. That was not the question. My question was currently I think the 99 rupee is more on Tuesday and now weekend and weekday crowd is different. So instead of Tuesday can you have it one more weekday? Does it make sense?
Gautam Dutta
No, this is an industry specific program where not Only PBR inops but the entire industry has been galvanized to actually have this specific one day off. We don’t want to start shifting our value customers from other days into 99 rupee day because that would begin to erode our profits. The idea is, was to get new customers on a specific day and it’s working brilliantly well. We don’t see the need for extending it beyond one specific day because as you would understand that cinema does cater to various audiences with different pocket size. And this day has been marked out for people which are time rich, cash poor and still have the ability to walk into a PBR Inox Cinema or any cinema for that matter.
And because all the cinemas are at 99 we get that advantage because clearly of our positioning and that’s a big one for us. So we don’t feel the need for extending it beyond one day of the week.
Ajay Bijli
Hello?
Abneesh Roy
Yeah, understood. On the, on the. Can I have a follow up?
Gautam Dutta
Sure, sure.
Abneesh Roy
Yeah, yeah, sorry. So one follow up. I wanted to understand more in terms of the understanding. So you mentioned industry wide Tuesday. That’s. That is something which I get. What I did not get was time rich, cash poor. Now if you see weekend audience generally my understanding is will be the office goer and the student who has classes on the weekday. So isn’t the customer base largely disparate? So if he’s free on Tuesday there can be customers who are also free say on the, on the Thursday or Wednesday. So I just wanted to understand why, why only one day you are restricting by opening up more weekdays which are anyway under occupied.
What is the issue? Because see someone who is coming on weekend, he’s office goer or a student who has classes. Right. So to that extent he can’t come on the other weekday.
Gautam Dutta
Yeah, I understand but the way we look at it is that the weekend is more family and the way we classify them is cash rich. Time poor is the weekend customer because he has the ability to pay. And we would really want to cash in on that audience in a different manner. The fact is Monday to Thursday any which way we operate on lower pricing than the weekend. Plus on the Tuesday we even lower it further to 99 flat pricing. So we believe that we are giving audience such as students, housewives and senior citizens which are largely the case between Monday to Thursday or opportunity to come and watch the film.
But even on Tuesday it’s even further dropped down to 99 on a weekend we believe that we any which way work on higher occupancy. If you See, the weekend occupancies are much higher than the weekday occupancy. That is largely because of the fact that it’s a family audience and this audience is willing to pay additionally for a great experience of coming to a cinema. So this is how we have allocated time zones for just about every category within the space and it’s kind of worked for us. We don’t feel that there would be a need to change that equation because we need to maximize on a few days and Friday, Saturday, Sundays also the first three days of when a movie is absolutely fresh and caters to an audience which is willing to pay the maximum price.
As days and weeks go by, the pricing keeps coming down and keeps opening a different subset of the market for us. That’s the way we’ve planned it.
Abneesh Roy
Sure. Thanks. Last question. So highest ever SPF. If you could discuss what was the reason. Second is post pandemic highest Q1 ad revenue. So what was the key driver here? Was it the Hollywood box office finally seeing a good number, 200 crores after two years and now the Hollywood the pipeline is looking good. Overall advertising, when I see for FMCG and for say media company like Zee and others it is not that good. So you have obviously done better. Your overall ad revenue is a bit more unpredictable and a bit more movie led. But what is the key driver for ad revenues being multi year high from a Q1 perspective?
operator
Sorry to interrupt. Sorry to interrupt. The line for Mr. Ajay busily has been disconnected. Please stay connected while we reconnect in them.
Gautam Dutta
So let me answer.
operator
Thank you for your patience. The line for management has been reconnected. Thank you and over to you.
Gautam Dutta
So on advertising for advertising revenue we tend to lean a lot on big star or film. That is something that has always worked for us. Unfortunately sleeper hits don’t work for advertising business. So from that point of view we had some big star of films that came in which was K3 with Akshay Kumar. He also endorses a lot of brands. We had ajay Devgn in Raid 2. We had good bagged Ugly with Ajit again who endorses a few brands in the south. All of these bigger films and Sitare Zamiper of course the fact of the matter is we garnered fairly decent advertising revenue on back of these films which did not only which opened well and had huge expectations with the advertiser and because of which we were able to get better numbers
Abneesh Roy
and SPH
Gautam Dutta
on the SPH end.
As I said the 99 rupee menu on the weekday and the unlimited popcorn and Pepsi refill pack along with that offer where anybody could buy a glass of pepsi by paying 50 rupees extra. All these offers really helped us to increase price rate and get the FDA chart. Also the fact that some of the big films that came in this quarter were Hollywood films which actually garnered a very different audience, which is a high ATP audience and they like to come and spend at the candy. There were hardly any films where you know, the youngsters came in alone.
So this was all family content that came in, high spending audience that came in. And because of which we were able to sort of galvanize a better SPH.
Abneesh Roy
One clarification here. Does the 99 rupee pricing help you in augmenting SPS? Because I thought 99 rupees affordable pricing, it may help you in conversion, it may help you in getting new customers. But we are talking about spend per head and 99 rupees affordable pricing. Does it help SPH in going up?
Gautam Dutta
Yeah, it does, it does. Because if you look at the way it operates is Monday to Thursday since till 6pm Till 6pm our strike rates are normally slightly dented because of the kind of consumer we get. Again, these are very value conscious consumers who would typically wait for a Monday to a Thursday and come and watch a film and they at times found our S and P pricing a bit high or. But with 99 they were easily able to convert. So you got to see that while the SPH was low but the conversion was better thanks to the 99 rupees offer.
Abneesh Roy
Okay, I discussed offline. I still don’t get it but thank you. That’s all from my day. Thank you.
operator
Thank you. Before we take the next question, we would like to remind participants to press Star and one to ask a question. The next question is from the line of Vaibhav Mule from yes, securities. Please go ahead.
Vaibhav Muley
Hi team. Congratulations on a good set of numbers. My first question was on your asset light and capital light strategy. So going forward, what kind of margin expansion do you foresee because of the addition of capital light screens? The reason I’m asking is there has been a significant cost reduction across the cost headers in Q1 results. So is there any particular reason for that or are we already starting to see the benefit of shifting towards capital light model?
Gaurav Sharma
So I just got aware, you know, today if you look at our circuit, the number of screens which are on asset light are very minuscule. So to answer your question, the control on cost that you are seeing is not because of asset light. It’s largely because of the cost discipline and various efficiency initiatives we have implemented across our circuit. Electricity, water, utilization of resources, optimizing and controlling on a variable basis linked to footfalls. All of that is driving the control on fixed costs not because of FOCO or Asset light going forward. Yes, majority of our new screen additions will be under the asset light model and in Asset Light model as I said, two different are there.
One is a focal where we don’t consolidate the P and L we only get the management fees and the other is where we have a developer invest or co invest in the capex where we share a certain percentage of you know rental incremental rentals with the developer in view of his investment where there is a margin impact but that margin impact is to a large extent taken care by the improvement in ROC and as a result the free cash flow that the property will generate in the break even period improves dramatically. So yeah so that’s our response.
Any further questions or any points you. Want to
Vaibhav Muley
so we can expect the current levels of cost as percentage so percentage of sales to continue going forward or even reduce from the current levels.
Gaurav Sharma
Yeah I think you in the near term the existing cost structure will continue but as the share of asset light improves increases over medium to long term the cost structure will shift a little bit.
Vaibhav Muley
Understood. My second question was on the performance in July. So you have mentioned in your press release regarding highest admissions in the past 18 months. But in terms of in terms of financial performance, what kind of color you can provide for the, you know one and one month and one week gone by. So what kind of you know admissions we have seen and also the trend in terms of ATP and SPH if you can provide a broad color.
Gaurav Sharma
Yeah I think you know July has been a very very strong month. Hindi films like Sayara, Avatar and English films like Jurassic World, even regional films have done very well. So all across the board, across all languages the turnout of admissions and occupancies have been pretty strong. I think we would not like to comment specific on financials for the month of July. We will report that as part of our quarter two earnings and give you more insight on how the quarter including July month has panned out.
Vaibhav Muley
Perfect. And just lastly on the net debt. So we have reduced the net debt by around 61 crores of Q1. So can we expect more net debt reduction because free cash flow generation can be pretty strong going forward given the kind of outlook that we have. And now we are shifting towards the FOCO and capital Light model as well. So given the strong free cash flow generation, net debt should accelerate going forward.
Gaurav Sharma
Yeah, that’s our priority to reduce net debt. I think you should expect the net debt levels to further come down. The operating cash flow increases. We will use the surplus cash to pay down debt. Yeah. So you should expect further reduction in debt levels.
Vaibhav Muley
Perfect. Thank you so much. That’s it for myself.
operator
Thank you. A reminder to the participants, you may press star and one to ask a question. Ladies and gentlemen, we will wait for a moment while the question queue assembles. The next question is from the line of Jayaram Shetty from ICICI Securities Ltd. Please go ahead.
Jayram Shetty
Hello sir. So what could be the impact of. The Karnataka tax on PVR profitability and operation? Overall operation.
Gaurav Sharma
So yeah, the Karnataka government order is yet not notified. There was a draft, you know notification release in mid July where the government sought feedback and objections from the public at large. A lot of feedback and objections have been sent out. More than 700 objections on the price cap has been sent out to the government. We have not yet heard anything after that. There is no clarity by when this notification if at all will become applicable. But you know also whether this will be applicable across the board or there will be exclusions in terms of details, sorry weekends and session formats and whether tax will be part of this 200 cap or not.
So there are a lot of moving parts. Depending on the final structure of the government order including the applicability across premium formats and weekends, the financial impact can be determined. So I think at the moment it’s a little bit premature for us to comment on this aspect.
Jayram Shetty
Okay. And my second question would be your consolidated loss has narrowed down significantly to. 54 crore in quarter FY26. So what are your key levels to. Sustain this momentum through FY26 and beyond?
Gaurav Sharma
Yeah, I think in our business the biggest driver of revenues and profitability are footballs. So the lineup of films across languages in the upcoming months and quarters is something which we are pretty optimistic. We feel that the momentum will momentum is very strong currently and the lineup will only support this momentum. So that’s one lever other is pricing on our tickets and fnb. You know we are very careful. We are doing a lot of initiatives. We are also trying to address the price sensitive audience by bringing out more promotions on both tickets and FNB through various initiatives.
And third is our control on operating costs. That is something which is a top priority for the entire organization. We are trying to make sure that the cost discipline continues. So yeah, these are the three Big drivers for the profitability in the remainder of the financial year.
Jayram Shetty
Okay, thank you for your answer, sir.
operator
Thank you. Participants, to ask a question, you may press star and 1. The next question is on the line of Vaibhav Moulay from yes, securities. Please go ahead.
Vaibhav Muley
Hi, I just had a follow up regarding, you know, 10 movies have done more than 100 crores of collection for the quarter. So what has positively changed according to you compared to previous quarters? Of course one, one of the reason is, you know, slightly improved content pipeline. But apart from that we have had good movies in the past as well. But revenue distribution has been very skewed towards a particular movie while many of the movies have performed poorly on the box office. So what exactly has been changing fundamentally among the consumer that has led to, you know, more distributed collections across movies?
Gautam Dutta
So there could be many reasons for this and we keep debating internally as well as keep checking with consumer and do deep inside sessions with them. But what we clearly are getting is that there is a OTT fatigue. Clearly that’s one. The content overall has become lot sharper and better. And the fact that people do want to come out and understand and enjoy this movie experience is the pivot point. The more and more that we are talking to consumers is they are saying the best and the only way perhaps to enjoy unadulterated movie experiences at the cinema.
So I think the swing is completely back and you can see this across. We’ve been sort of doing deep research at each of our cinema locations. The sheer footfall has increased and consumers are very actively now seeking for fresh content. And I think what we’ve been lucky is the fact that the directors and producers of new content have clearly got the vibe of the consumer and are creating stories which are kind of connecting with today’s audience and their requirement. Also one big move that we are seeing is the whole shift from stars to stories. I think if you look at the success of some of the films, you will clearly see that the move from just a multi starrer or a big starred film, two great stories has come into play and that really augments better footfalls to the cinema.
The last point that we have kind of again captured through the creative fraternity is now across the board. Whether it’s Bollywood, Hollywood or Tollywood or the regional film, they are all eyeing a pan India market. So there is no longer a regional divide for a film. So if you talk to today any film creator, he is not creating a film for a certain boundary. His stories, the way they are shooting, the way the Production values are they are trying to cater to a much more, much larger audience and which really augments really well for us.
Regional content is on a high. And along with the fact that regional stars, and when I say stars, I mean great actors are coming into four, this is something which we will continue to see Even in the two big star films which are due to come on 14th, which is fully and War where we have the leading Bollywood and the south stars coming together. And same is the case with Kuli same Rajini Kant and Aamir Khan coming together. So I think this is a few trend lines that we are seeing which is resulting in higher footfall with the cinema.
Vaibhav Muley
Just a follow up on that. You said OTT fatigue is there. So what do you mean by that? Are the investments behind OTT platforms are starting to slow down or new content, you know, the amount of new content is, you know, slowing down or it’s just that the consumer preference is now again shifting towards the movie exhibition to watch the movie on the big, big screens.
Gautam Dutta
While I will react more from an outside in perspective, we don’t have an inside view of what’s happening really at the OTT side. But what if you see is it’s not as if there is a complete lack of content. Content is coming in there as well. But there’s clearly a fatigue where people are saying I’ve seen it all. In fact, they seem to be now getting into a rut where a similar kind of content is finding way. They have now got into a bit of a constraint where stories cast everything is playing to a certain plot.
Whereas cinemas have started to now break the mold, come up with far more fresh stories and coupled with a great experience that the family gets when they come and visit a cinema. Because this unadulterated cinema experience is something which only cinema can deliver sitting at home. There are just far too many distractions which consumers are now coming to terms with. And you know what happens is we’ve often seen that through 20 years, 25 years, that one a consumer is out to watch a film at the cinema he gets hooked on and would come back to a cinema quite often.
So if he comes out once, you will see the same customer coming out again and again and again because that’s when he begins to enjoy the sheer experience of a cinema.
Vaibhav Muley
Got it, sir. And is there any chance of improving the increasing the OTT window from the current. I think it’s about four weeks. And also to make it consistent across, you know, regional languages?
Gaurav Sharma
No, the current window is not four weeks for Hindi films. The theatrical window is eight weeks before. It. And you know that the global windows are also six weeks for a pay per view or transaction and minimum 8 weeks for subscription based OTTs. Windows in South India are slightly shorter but there is no change. And these are the windows which were there in pre Covid period also and the same windows are currently applicable.
Vaibhav Muley
Got it. And just lastly on the I had heard Mr. Bisley saying that PVR will eventually become along with the movie exhibitioner and overall platform for out of home entertainment and entertainment consumption entity. So are there any steps that we are taking in that direction from a long term perspective?
Gaurav Sharma
So I think our mainstay the way the infrastructure is designed is for movie. What our long term view is that how we can utilize the existing infrastructure for alternative content other than movies and that is the strategy that we want to focus on which is to say that if we can do more of live event screenings, IPL matches, comedy shows, conferences in our cinemas which are not dependent on films only. And you know the other piece is re releases of the huge library of films that we have access to. Depending on the audience buzz around what sort of genres and films that they would like to see.
We decide on a re release strategy. So we want to use our existing cinema infrastructure for multi purpose entertainment out of home including movies and other live events and alternative content.
Vaibhav Muley
Perfect. Understood. Thank you so much for answering my questions and all the best.
operator
Thank you. The next question is from the line of Avish Parikh from BNK Securities. Please go ahead.
Kavish Parekh
All right, thanks for the opportunity. Congratulations on a good set of numbers. Firstly on the margin front Fairly Healthy Show 730 Sequential margin improvement on the back of 150 WIPs Occupancy expansion We already touched upon that. Part of it was aided by increase in share from Hollywood, part from cost control. Any cost levels that can further be exercised to sustain or rather derive these benefits in lull periods which usually see sharp dips in margins. Any thoughts on that?
Gaurav Sharma
Sorry, can you repeat your last sentence? It was not very clear.
Kavish Parekh
Increase in share from Hortonwood as well as cost control aided us to deliver these margins. Any cost levers that can further be exercised to sustain or rather derive these benefits in lull periods which usually see sharp dips in margins.
Gaurav Sharma
Yeah. Our business is a business which is dependent on flow of footfalls and admissions. And over the course of last two years and especially post merger, we have leveraged technology, we have leveraged scale to control and variabilize our cost at the ground. So when there is less number of footfalls or weekdays. Our usage of contractual staff is accordingly monitored and altered. Similarly for electricity air conditioning utilities, it’s also controlled based on occupancy levels within the cinema hall. As a result, we are able to control electricity cost. We are also deploying solar panels in cinemas where our dependence on, you know, grid electricity reduces and cost effective solar electricity is being supplied.
So these levers are being put into place and they will, you know, give benefit to us. But yeah, I think most of the cost areas we have explored and we have put in place the efficiency measures benefit of this will be visible as the operating leverage in the business shows up with increasing footfalls.
operator
There is no response on the current participant. We would move to the next participant. The next question is on the line of Oman Mehta from Kotak Securities. Please go ahead.
Umang Mehta
Yeah, hi. Thanks for the opportunity. Am I audible?
Ajay Bijli
Yeah.
operator
Yes you are.
Umang Mehta
Yeah, thanks. So my question was again linked to one of the previous participants. While you mentioned that you can’t share details on July kind of profitability, you know, you delivered six and a half percent margin with 22% occupancy. As we enter the seasonal period where ATPs will be even better, would it be too far fetched to think that with the 25, 26% occupancy you could do mid teen or even higher EBITDA margins? I mean given the current cost structure.
Gaurav Sharma
See if you look at our financial year 24 results, which is year ago at a 25% occupancy, we did about 13.5% EBITDA margin. So that’s a mid teens EBITDA margin at a 25% occupancy. Now you know, a lot of the margins is dependent on how the other weavers in the the business like pricing, advertisement, income, you know, cost, they pan out. So yeah, I think it’s very hard for us to say where exactly you know, the margins will be. The occupancies are 25% in subsequent quarters.
Gautam Dutta
I’d like to add one point to what Gaurav said. If you traditionally look at our business, our business quarter three is by far the biggest quarter. So as far as the Trend goes, Quarter 1 and Quarter 4 are kind of comparable and then the biggest quarter is quarter three followed by quarter two. So the better quarters are yet to come. So from that point of view, overall all the matrices going up is quite likely
Umang Mehta
understood. That’s helpful. The second one was on the full year kind of footfalls. Now we generally rely on your assessment of the pipeline on how it looks for the rest of the year. Would you be confident at this stage that footfalls for the year could cross F24 levels? Roughly around 150 million plus. This is whatever you see in terms of your assessment of the pipeline.
Gautam Dutta
Yes, absolutely. In the sense the way the pipeline is stacked up, there is absolutely no doubt that we would cross. We were very confident when we were starting off the year in April and now after the end of quarter one, it’s only looking better. So as Gaurav has shared that July was a bumper month for us. So all indicators are that we would surely cross the last year footfall numbers.
Umang Mehta
Sure, last year. But you mean 24, right? F 24.
Gautam Dutta
Yeah.
Umang Mehta
And just the last one was on capex. Gaurav, would you still maintain the 4 to 4.25 billion capex for this year or does it go down further given your progress on capital life models?
Gaurav Sharma
No. So for the new screen additions of 90 to 100 screens that we plan to open and our, you know, increase in renovation CapEx that we decided at the beginning of the year, we have not changed our capex guidance, we will spend roughly in total about 400 to 425 crores which will include about 250 to 260 crores on new screens, about 70 to 75 crores on renovation and remaining 75 crores on maintenance, IT and other related capex.
Umang Mehta
Understood? Very clear. Thank you so much and all the best.
operator
Thank you. The next question is from the line of Jinesh Joshi from PL Capital. Please go ahead.
Jinesh Joshi
Thanks for the opportunity. Sir. My question is on our management fee income which was about 2.4 crores in this quarter. I know the figure is quite low but given we have plans to expand via the focal route, I mean where do you see this number stabilize at maybe two to three years? I mean, just wanted to get some sense on this because I believe in this model your fleet will EBITDA is quite high.
Gaurav Sharma
Yes, management fee is entirely flowing through to our ebitda. And this number is only going to increase as the new signings of FOCO will happen. You know, we’ve shared that we have signed about 55 screens under, you know, FOCO model. And as these screens open, the management fee income from these screens will accrue in our P and L. So it will continue to grow, you know, to what number it will be and you know, what level it will become. It’s hard for us to say but clearly it’s on uptick growth trajectory.
Jinesh Joshi
Got that. And secondly, I believe our Fixed contract that we had with BMS ended sometime back end. We are on the revenue share arrangement, if I’m not mistaken. Now in this quarter, while our salary fee has increased on YY basis, the contribution of convenience income to the overall box profit collection is down on YY basis. So has there been any change in the revenue share arrangement? If you can please clarify on that side.
Gaurav Sharma
So there is no change in the revenue share arrangement with our ticket aggregators. It remains as per the contract that the growth in convenience we have seen is roughly around 10% versus a 22% growth in our box office collections. So you know, actually there was a impact of a certain provision that we had reversed last year in quarter one of roughly around 3 crores. Because of which the last year quarter one convenience fee was higher by 3 and a half crore. If you adjust for this reversal entry in last year quarter one, then the growth in convenience fee will be largely in line with the growth in the box office.
So roughly around 19, 19 to 19 and a half percent growth in convenience fee which is in line with the box office growth or the change in the convenience contract aggregators.
Jinesh Joshi
Understood. Understood. And so one last question on Karnataka. I know this was discussed earlier in the call, but given the situation over there in terms of price gaps, have we, have we slow down our expansion plans over there? That is one. And secondly, have we also seen any kind of cancellations come through from our. Given the fact that their ROI can also get compromised if prices continue to remain capped?
Gaurav Sharma
No, there is no change in our expansion strategy in Karnataka. You know, as I said earlier also Karnataka, there is no government order which has been released on price gap. So you know, it’s premature for us to make any strategy with decision based on this. We have, you know, plans to open screens in Karnataka, including in Bangalore. We will, we will assess how the situation unfolds on this pricing issue.
Jinesh Joshi
Understood. But any cancellations or any change of plan from our focal partners which you would want to highlight?
Gaurav Sharma
No, no, nothing that I want to highlight on that. There is no change, there is no cancellation. There’s nothing of that sort happen.
Jinesh Joshi
Thank you. Thank you very much.
operator
Thank you. The next question is from the line of Hareem from Investech. Please go ahead.
Harit Kapoor
Hi, good evening. So I just have two questions. You know, when you spoke about this Blockbuster Tuesday, you spoke about three types of categories of people coming in. You know, college students, senior citizens and housewives. I think two out of those three categories, as per the industry research, you know, done in the past were the categories not really coming in in the past, I mean, housewives and senior citizens, I think that age cohort also was lower down in terms of the growth. So do you see this, you know, this strategy as being kind of medium to long term structurally positive for you, as in that can really drive up, you know, footfalls from these cohorts which are especially probably challenging post Covid.
Gautam Dutta
So first and foremost they were coming. It’s not as if they weren’t coming. But this was an available cohort to us from Monday to Thursday. And all our footfalls that we were getting even earlier, Monday to Thursday, they were the kind of people. And when we had launched this as per our plan, we felt that we could galvanize a larger chunk of people within this cohort to come out and watch movies. And that’s exactly what has happened. So more number of students, more numbers of housewives and more senior citizens who were still on the brink earlier to come and watch movies at the normal weekday pricing and they still felt a little resisted, now felt that as if it was a day when they could just go and watch.
So it’s just that it expanded the market and it’s worked brilliantly well for us and we believe it’s a long term initiative for us. We intend to keep this running. The beauty of this model is also that the prices start at 99. So if a film which is new or doing well, we do have the program in a manner where films can run at 99, 149 and 199. So we technically work within the three bands. And this is really helping us because as I said, it is galvanizing a much larger footprint of people coming in.
Now, even in the evening shows on Tuesday, we are seeing some of the office goers and families are also coming out because they feel it’s a great value day. And so while we’ve just had a couple of months in this promotion, after about six odd months, we also want to do a frequency analysis to ascertain if we have managed to not only get them out, but manage to get them out more often and watch more movies. This is something that we can’t do it now simply because it’s too short a period. But after about, I think six months, we have a very good idea on two things.
One, have we managed to create a bigger market? The answer clearly seems to be yes. The second is have we managed to get them to watch more movies because of this promotion? Something I we can’t answer today, but hopefully in next five to six months that answer will be very clear.
Harit Kapoor
Great. And we look forward to what your research throws up. The second thing was on ATP, you know, this quarter to 8% growth, should. We assume that there is a little. Bit of a drastic mix change also here which is affecting some, I mean much lower south, stronger Hindi, stronger Hollywood, especially in this 8% growth, hence is not representative of what the full year could be.
Gautam Dutta
Yeah, you’re right. But the fact of the matter is Hollywood, IMAX films, 4 DX films, Bollywood, big star films do end up driving ATP. But also if you look at the lineup, with so many blockbusters, regional blockbusters lined up, we believe that all should get blended up really well and this is quite possible to maintain this growth.
Gaurav Sharma
I would like to just add to what Gautam said, Darit, that if you see our last financial year 25, our ATP was flat compared to previous year. We had zero growth. Also last financial year Hollywood saw a significant drop, drop because of the Hollywood strike. And as a result the content mix was more in skew up in the favor of regional and Hindi. Hindi also had, you know, hits and misses and volatile year. So with Hollywood bouncing back and coming back to its normal contribution the way it used to be earlier, the growth in ATP, you know, will be there year on year.
What level and how much is only 9 will 10 depending on how the films perform at the box office.
Harit Kapoor
All right, Gaurav, the third one was on rentals. So all your cost levers you have exercised are showing great results. Rental per screen, if you just do that math, is up 5%. I just wanted to understand with Foco as well as your negotiations, ongoing negotiations, always with landlords, is that still a cost lever which can still grow slower than revenue over a two, three year period. And that’s something which is, you know, which can incrementally provide you some benefits over a, over a two, three year period.
Gaurav Sharma
Yeah, the rentals, unfortunately, you know, we have registered leases and they are governed by the escalation clause. Those leases, having said that, even this growth in rentals that you are seeing is after taking into account a lot of renegotiations and waivers on escalations that were triggering in quarter one. Now, without getting into specific numbers, I can tell you we, you know, our growth in rentals just purely on account of escalations would have been higher compared to what we’ve reported if these renegotiations would not have been done. The benefit of this will be visible in the quarter two and the full year financials also.
But you know, it’s a big task. We have a 1312, 50 crores of rental cost a year and bulk of this is from registered leases in existing properties which are not focal or Asset Light. So you know, this will, this is a priority for us and we are focused but as a, as a percentage of revenue, it is still a significant cost in US pnl.
Harit Kapoor
Thank you very much. All the best. Thanks.
operator
Thank you. The next question is from the line of Kavish Parikh from BNK Securities. Please go ahead.
Kavish Parekh
Hi. Thanks for the follow up on the Asset Light models. Could you share some details about how the unit economics of margins look like in properties that you have already started operating? What does the revenue share agreement look like both in SOCO and Asset Light?
Gaurav Sharma
So in Asset Light we’ve opened one property in Mall of India Noida where the developer contribution is there and this got opened only, you know, early this year. So we will, you know, look at the performance for some period of time before coming on to any conclusion in shift sharing the performance. But as such the developer contribution, unit economics in terms of margins, you know, depending on the level of developer contribution, the margins are accordingly calculated because whatever is the developer investment in view of that incremental rentals are given. But the return on capital employed profile and the breakeven period is far better than traditional 100% lease model in a focal property where the 100% investment is done by the developer there because we don’t have any investment there is, you know, it’s all flowing through directly to the EBITDA in the form of management fees.
So. You know, so that’s how it is. But we will give you more color and more insights on the asset light developer contribution model once we have some reasonable period of time for their performance to monitor.
Kavish Parekh
And last slide, how are the Passport initiatives doing? Any updates on that?
Gautam Dutta
Passport has been discontinued simply because the film fraternity did not sort of agree to the fact that the film should their film should be discounted. They wanted it to be labeled under the marketing structure for PVR Inox and which was really not the way Passport could have survived. So we have given a, a kind of a break to Passport and we are still working internally and externally to see if there was a way that we could relaunch it in a couple of months. Sorry, sorry.
Kavish Parekh
Please continue.
Gautam Dutta
Sorry,
Kavish Parekh
I was asking any thoughts on relaunching the loyalty program similar to what you had before the merger?
Gautam Dutta
Not really in the sense we really went out and spoke to the consumers. Again, loyalty program works when you can influence a consumer to come and watch a film of your choice. When I say your choice, I mean when an exhibitor is able to push a certain film because if you will only collect points and watch a film. That you want to watch and I. Am not able to propel you to come to the cinema again, it wasn’t working. So we felt that a Blockbuster Tuesday was doing that job much better. That’s number one. Number two, in a market where any which way, some of the key markets where we have dominance and with high quality cinema experience, we felt that these minuscule points that we were giving out was not able to influence the consumers to come to the cinema. So it was just an expense sheet that was being maintained, but not something that was resulting in any great business for us.
Kavish Parekh
Understood. Thanks a lot. All the very best.
operator
Thank you. Ladies and gentlemen, this was the last question. I now hand the conference over to the management for the closing comments. Thank you. And over to you.
Gaurav Sharma
Thank you all for joining us on this earnings call today. In case of any questions, you may reach out to our investor relations team or directly to us. Thank you so much for your time.
operator
Thank you. On behalf of ICICI securities, we conclude this conference. Thank you for joining us. And you may now disconnect your lines.