PVR Inox shares shot up nearly 2% on Wednesday as brokerages put their weight behind the entertainment stock.

What Happened: The country’s top multiplex chain booked a net loss of ₹82 crore in the first quarter versus a loss of ₹53.2 crore a year ago, hurt by a lackluster performance of Hindi films, slow footfall recovery, and reduced cinema advertising revenue.

Despite the year-on-year decline, the company narrowed its losses from the previous quarter, reporting better-than-expected revenue growth of 32% year on year to ₹1,304.90 crore.

The Hindi box office displayed a gradual reduction in quarter-on-quarter volatility, accompanied by improved performance of mid-scale Hindi movies, according to managing director Ajay Bijli.

PVR Inox reported an average ticket price of ₹246 and spend per head (SPH) of ₹130. The company opened 31 new screens, reaching a total of 1,707 screens across 361 cinemas in 114 cities in India and Sri Lanka.

The firm added that several Hollywood blockbusters like Oppenheimer, Mission Impossible: Dead Reckoning Part 1 and Barbie contributed to a 70% growth in quarter-on-quarter box office collections for Hollywood films, hinting at a resurgence in theatrical moviegoing.

What Brokerages Think: Analysts at brokerage CLSA maintained a “buy” rating on the stock with a target price of ₹2,015. The brokerage highlighted the management’s optimism about the content line-up.

Meanwhile, analysts at HSBC also reiterated a “buy” rating and a target price of ₹1,565, saying that the first-quarter results disappointed but the quarter-on-quarter rebound bodes well for the rest of the financial year.

Price Action: PVR Inox’s share price jumped over 2% in very early trade on Wednesday, but pared gains soon after to trade 1.33% higher at ₹1,586.30 amid broader weakness in the Indian market.

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