Multiplex stocks jump as India, home to Bollywood, allows theatres to reopen

UFO Moviez India

01/10/2020 07:08

By Vibhuti Sharma
    BENGALURU, Oct 1 (Reuters) - Shares of India's two largest
multiplex operators PVR Ltd  PVRL.NS  and Inox Leisure Ltd
 INOL.NS  surged in morning trading on Thursday, after the
government said it would allow states to reopen movie theatres
at half their capacity from Oct. 15 after remaining shut for six
months.
    PVR's shares rose as much as 15% to 1395.15 rupees, while
Inox surged 17.6% to 318 rupees, pushing the Nifty media index
 .NIFTYMED  up 4.3%.
    About 9,500 theatres have remained shut since the nationwide
coronavirus lockdown started in late March. Movie industry
representatives in Bollywood have said it would take at least
two years for them to recover financially from the pandemic,
putting tens of thousands of jobs at risk.  urn:newsml:reuters.com:*:nL3N2C912Z
    Industry executives and analysts said the move to reopen
would help tap pent-up demand, especially as India heads towards
a busy festive season, which culminates with Diwali.
    "Pent-up demand will kick in as more movies release Diwali
onwards", said Keshav Lahoti, equity analyst at Angel Broking.
    Many big-budget Bollywood movies have been getting pushed to
the next fiscal year, as falling box-office collections made
production houses face a liquidity crunch. Streaming services
such as Netflix Inc  NFLX.O  and Amazon Prime  AMZN.O  have
stepped up releases of original shows and movies.
    "As the situation improves and with the festive season upon
us, we are confident that films will return to the big screen,"
said Ashish Saksena, a senior executive at ticket booking site
BookMyShow.
    The federal government's announcement comes just days after
the state of West Bengal said it would allow cinema halls and
open-air theatres to operate in the state from Oct. 1 with a
limited number of participants.
    PVR's shares were trading up 9.3%, while those of Inox were
up 7.5% at 0556 GMT. Movie distributor UFO Moviez India Ltd's
 UFOM.NS  shares rose 6.6% to 80 rupees.

 (Reporting by Vibhuti Sharma in Bengaluru; Editing by Shounak
Dasgupta)
 ((vibhuti.sharma@thomsonreuters.com; +91 702 213 2017; Twitter-
@VibhutiSharmas))