PVR and Inox stocks continue to nosedive on Wednesday

Stocks of multiplex operators PVR Cinemas and Inox Leisure continued to nosedive on Wednesday after the Delhi government ordered closure of cinemas halls in the city due to a spike in the number of fresh Covid-19 cases.

Delhi Chief Minister Arvind Kejriwal on Tuesday announced that the city has been placed under yellow alert, following a biggest single-day spike in infections in six months with 331 new cases.

The yellow alert came with several restrictions including night curfew between 10 pm and 5 am, capacity restrictions at private offices, weddings and other outdoor events, odd-even rules for malls and shops.

Soon after the announcement, shares of PVR and Inox Leisure began to fall sharply as theatre closure and night curfew will have a serious impact on the pan-India film exhibitors, whose business began to see recovery only since Diwali.

Shares of India’s largest multiplex chain PVR Limited shed more than 3 per cent on Wednesday to trade at ₹1,247.30 apiece on the BSE. The stock already tumbled 3.58 per cent to close at ₹1,286 on Tuesday. Similarly, stocks of India’s second largest movie chain Inox shed 2.28 per cent early on Tuesday to trade at ₹343.55 per share.

Government announcement
The Delhi government’s announcement came as a major shock to the film exhibition industry which was pinning hope on big bang theatrical releases including SS Rajamouli’s RRR, Ajith Kumar’s Valimai, Prabhas’ Radhe Shyam and Akshay Kumar’s Prithviraj for its business recovery.

In a press statement, the Multiplex Association of India (MAI) said, “Delhi government’s decision to shut down cinemas in Delhi while enforcing the ‘yellow’ alert of the Graded Response Action Plan (GRAP) has caused massive uncertainty and could lead to irreparable damage for the Indian film industry.”

Industry experts believe the closure of theatres in Delhi and increasing curbs in other States will not only impact the box office collections of currently running films like Ranveer Singh’s 83 or Allu Arjun’s Pushpa, but will also delay the upcoming movie releases.

Already, the makers of Shahid Kapoor’s Jersey took to Twitter on Tuesday to announce that the film’s theatrical release has been postponed. It was scheduled for release on December 31. The Hindu BusinessLine