PVR Inox Ltd Management Discussions

GLOBAL ECONOMIC REVIEW

The global economy in CY25 continued its gradual recovery trajectory, though growth remained uneven across regions. Global GDP growth is estimated at approximately 3.4%—broadly in line with CY24—with inflation easing to around 4.2% in CY25 from 5.8% in CY24, signaling continued reduction in inflation. Unemployment remained sticky at ~4.9%, a modest improvement year-on-year. Global growth is projected to be 3.1% in 2026 and 3.2% in 2027.

GDP Growth: India vs. Global Peers (CY19–27)

India data on fiscal year basis (April–March); all other economies on calendar year basis. Source: IMF World Economic Outlook, April 2026, World Employment and Social Outlook: Trends 2025.

A defining macroeconomic theme of 2025 was the recalibration of global trade flows in response to the United States escalating tariff policies, particularly targeting imports from China, Europe, and emerging markets. This sparked a renegotiation of supply chains, elevated input costs for manufacturing economies, and heightened volatility in currency markets. However, contrary to earlier fears of a global recession, the International Monetary Fund (IMF) notes that most economies managed a measured adjustment, supported by resilient domestic consumption and continued fiscal stimulus in key markets.

Emerging Market Economies (EMEs) demonstrated relative resilience, with India and Southeast Asian economies outperforming advanced economies. Chinas recovery remained tepid, with its GDP growth estimated at ~5.0%, constrained by a property sector overhang and weak consumer confidence. The US economy maintained above-trend growth at ~2.1%, supported by a robust labour market, while the Eurozone grappled with subdued industrial output.

On the monetary policy front, the US Federal Reserve began a cautious easing cycle in late 2024, with two additional rate cuts executed through CY25. Several central banks in emerging markets followed suit. However, uncertainty around tariffs and geopolitical risks, — particularly in the Middle East and Eastern Europe — kept financial markets on alert.

Global consumer sentiment showed signs of improvement compared to 2024, particularly in discretionary spending on experiences. A post-pandemic normalization in out-of-home entertainment, travel, and dining continued, underpinning growth in the global entertainment and leisure sector.

For India specifically, this global context is highly supportive. Contained inflation, declining interest rates and steady global growth are creating favorable conditions for sustained domestic discretionary spending, including on entertainment. These conditions are among the most favorable seen since the pre-pandemic era. The following section examines how India has translated this global tailwind into consistent outperformance.

THE INDIAN ECONOMY: A DECADE OF STRUCTURAL TRANSFORMATION

THE MACRO FOUNDATION

India retained its position as the worlds fastest-growing major economy in FY26, with GDP growth estimated at 7.6% (IMF World Economic Outlook, April 2026; RBI MPC, April 2026). This performance was driven by strong domestic demand, robust infrastructure spending, a buoyant services sector, and a recovery in rural consumption following improved agricultural output. Indias Per Capita NNI at current prices stood at INR 2.2 lakhs in FY26 (MoSPI).

The Union Budget FY26 provided a meaningful consumption stimulus through enhanced income tax exemptions — raising the tax-free income threshold to INR 12 lakh under the new tax regime, effectively increasing disposable income for salaried households. This structural increase in take-home pay is expected to have a direct and measurable effect on discretionary spending across the economy.

Inflationary pressures moderated during FY26 and remained within the RBIs tolerance band of 2–6%. Against this backdrop, the Reserve Bank of India progressively eased monetary policy during the year. The policy repo rate was reduced by 25 basis points to 6.00% in April 2025, followed by a 50-basis-point reduction to 5.50% in June 2025, with subsequent policy actions taking the rate lower. The combination of moderating inflation and easier monetary conditions supported household purchasing power, credit conditions and the outlook for discretionary consumption.

Indias demographic dividend — with a median age of approximately 29 years — continues to drive consumption, led by millennials and Gen Z, who are disproportionately spending on experiences over goods. By 2030, India will have approximately 400 million Gen Z consumers and 350 million Millennials — together nearly twice the current population of the United States (Fireside Ventures, The Indian Consumer at 2030, October 2025). The Millennials and Gen Z cohorts now driving consumption are experience-oriented rather than possession-oriented. Understanding what this demographic wave means for household spending, however, requires first examining the income transformation enabling it.

THE INCOME PYRAMID IS BEING REBUILT

The most consequential structural development underway in India is the rapid reshaping of the household income pyramid — and what that means for how, where, and on what Indians choose to spend. High-income households earning INR 20 lakh and above are projected to grow from 14-16 million in FY24 to 22-24 million by FY30. Upper-middle-income households in the INR 10-20 lakh band are expanding from 45-47 million to 56-58 million. Most significantly, lower-middle-income households in the INR 5-10 lakh range — the cohort at the inflection point of discretionary consumption — are projected to grow from 106 million to 147 million (Fireside Ventures, The Indian Consumer at 2030, October 2025).

Middle-class and affluent consumers are on track to account for 93% of all consumer spending in India by 2036, up from approximately 80% today (Oxford Economics, cited in World Economic Forum and World Data Lab, 2026). In every market where this income migration has occurred, the pattern is consistent: the share of wallet devoted to basic necessities contracts sharply, while spending on services, branded consumption, and experiences expands correspondingly. India is entering that phase at scale, across geographies, across generations, and at a speed with few historical precedents.

Household income pyramid migration (millions of households)

FROM OWNERSHIP TO EXPERIENCE: A STRUCTURAL REORIENTATION

The income progression described above is reshaping not just how much Indians spend, but what they spend on. According to EY-Parthenon and BookMyShow (Beyond Attention. Into Immersion., January 2026), 78% of Indian consumers today say they would rather spend on experiences than products. This is not a cyclical preference among the urban affluent. It is a structural reorientation rooted in generational identity — and it is strongest among the two cohorts now driving primary consumption.

Indias experience economy is projected to cross USD 300 billion by 2030 (Fireside Ventures, The Indian Consumer at 2030, October 2025). Travel, dining out, sports, fitness, cultural engagement, and out-of-home social occasions are among the fastest-growing wallet movers across every generational cohort studied. Experiential media already represents approximately 23% of total media and entertainment revenues in India (EY-Parthenon and BookMyShow, Beyond Attention. Into Immersion., January 2026) — reflecting the decisive shift in household spending toward participation, cultural engagement, and shared social experience.

"India is buying moments, not materials. Every product will need an experience layer. Every category will need a ‘feel something hook."

— Fireside Ventures, ‘The Indian Consumer at 2030, October 2025

Organised, out-of-home entertainment is one of the most structurally aligned formats within the experience economy — immersive, emotionally resonant, and socially shareable in ways that no at-home format can replicate. It combines the cultural engagement of shared creative experience with the community dimension that consumers at every stage of life are actively seeking. As Indias income pyramid rises and consumer aspiration deepens, the demand premium out-of-home entertainment is structural rather than cyclical.

Not all experiential categories, however, scale equally. Formats that combine frequency of consumption, accessibility across income cohorts, and the ability to scale through organised physical infrastructure are structurally advantaged — generating demand that compounds as organised supply expands to meet it. This shift is closely linked to the broader transition from unorganised to organised consumption that is a defining feature of Indias current economic moment.

THE DECENTRALIZATION OF INDIAS CONSUMER CLASS

Indias consumption story is no longer a megacity story. The experiential shift described above is not confined to Mumbai, Delhi, or Bengaluru — it is spreading geographically with the same structural force. Research by Oxford Economics, published via the World Economic Forum and World Data Lab (2026), projects that 93% of the growth in Indias urban consumer class through 2040 will occur outside the countrys five largest cities — Delhi, Mumbai, Bengaluru, Kolkata, and Chennai. By 2035, India will have 499 consumer cities — more than double the number today — and by 2040, India will have 149 cities with half a million consumers, surpassing Europe and second only to China globally.

This is not incremental growth at the margins. It is a fundamental rebalancing of where Indian consumption happens. As these cities reach critical mass, their spending patterns converge toward those already visible in Indias most developed urban centers — where Metro and Tier 1 consumers already allocate 70-73% of retail spending to discretionary categories, against 45-48% for Tier 2 consumers today (Fireside Ventures, The Indian Consumer at 2030, October 2025). As that gap closes, incremental spending is expected to flow predominantly into services, branded consumption, and experiences. Critically, organised leisure and entertainment infrastructure — physical assets that bring premium experiences within reach of a population that has the income and the aspiration but previously lacked access — is a direct enabler of this convergence.

Discretionary spend share and per capita retail spend — Metro & Tier 1 vs Tier 2 (FY24)

A GENERATIONAL MOSAIC DRIVING DEMAND

Any serious assessment of Indias consumer outlook requires engagement with its generational dimension. Each cohort carries distinct values, motivations, and spending priorities that have direct implications for category growth across the economy. Gen Z spending alone is projected to grow from USD 520 billion in FY24 to over USD 1.3 trillion by FY30 — a 17% CAGR, the fastest among all cohorts. Millennials, already accounting for USD 960 billion in spending, are expected to exceed USD 1.5 trillion over the same period (Fireside Ventures, The Indian Consumer at 2030, October 2025). Each cohort gravitates, in its own way, toward experience.

Taken together, these cohorts represent not a single consumer market but a mosaic of distinct, substantial, and complementary demand pools — each growing and evolving while directing a rising share of spending toward shared, participatory and out-of-home consumption. What unites them is not demography alone, but a fundamental reorientation in what spending means. The World Banks South Asia Economic Update (April 2026) confirms that Indias FY26 growth of 7.6% was supported by strong domestic demand and export resilience; notably, private consumption growth was particularly robust, aided by low inflation and GST rationalization — underscoring the increasingly demand-led nature of the economy rather than one driven primarily by investment or exports.

India in 2030 will be a nation of 1.5 billion people — the majority of whom will be young, aspirational and experience-driven, with rising incomes and a generational wave of consumers whose preference for shared, out-of-home experiences is not a phase but a permanent reorientation. It is within this context that the evolution of the global and Indian cinema exhibition industry must be understood.

Sources: Fireside Ventures, The Indian Consumer at 2030, October 2025; World Economic Forum / World Data Lab, ‘Indias consumer growth is happening where youre not looking (2026); EY-Parthenon & BookMyShow, ‘Beyond Attention. Into Immersion. (Jan 2026); RBI Monetary Policy Committee; Ministry of Statistics and Program Implementation, Government of India; IMF World Economic Outlook (2026).

GLOBAL FILM EXHIBITION INDUSTRY

The global box office delivered a landmark performance in CY25, crossing the USD 33 Bn mark — an approximately 10% increase over CY24s USD 30 Bn — driven by an exceptionally strong content slate. This represents the second-highest global box office since 2019, signaling a decisive post-pandemic recovery and the return of large-scale theatrical cinema as a cultural phenomenon.

The United States and Canada remained the worlds largest theatrical market, contributing USD 8.9 Bn in CY25 — essentially flat with CY24s USD 8.8 Bn but meaningfully above the pandemic trough of USD 4.6 Bn in 2021, and recovering steadily toward the pre-pandemic average of USD 11.5 Bn. Hollywood delivered several record-breaking tentpoles in 2025: A Minecraft Movie, Lilo & Stitch, Mission: Impossible – The Final Reckoning, Jurassic World: Rebirth, and Demon Slayer: Kimetsu no Yaiba – The Movie: Infinity Castle collectively drove mass audiences. The domestic US box office surpassed USD 8.6 Bn for the year — the strongest performance since 2019. In Japan, Dragon Ball Daimas theatrical run and other anime blockbusters drove exceptional attendance. Latin American markets, led by Brazil and Mexico, were among the fastest-growing globally. China delivered a welcome rebound in CY25, with box office collections rising to USD 7.4 Bn — up from USD 5.8 Bn in CY24, a 28% year-on-year recovery — and closing in on its CY23 level of USD 7.7 Bn.

Premium formats continued to demonstrate outsized growth. IMAX globally reached USD 1.3 Bn in Global Movie collections in CY25, a new record surpassing its pre-covid levels. Attendance of premium large-format (PLF) screens grew faster than the overall market, with IMAX, Dolby Cinema, and ScreenX all reporting record numbers. According to Fandangos 2026 study, 84% of US moviegoers attended a premium format film in 2025, up from 77% in 2024 and 71% in 2023 — highlighting a compelling structural trend that mirrors Indias own premiumization story.

INDIAN FILM EXHIBITION INDUSTRY

4a. Indias Cinema Infrastructure: The Supply Gap as Structural Opportunity

While the demand environment for organised cinema is demonstrably strong, the more consequential long-run growth driver for the exhibition sector is the structural inadequacy of Indias cinema infrastructure relative to its population. India remains significantly under-screened: with approximately 10,003 cinema screens serving a population of 1.45 billion as of March 2026, the country has a screen density of just 7 screens per million people — compared with 64 in China, 66 in the UK, 95 in France, and 109 in the United States, representing a gap of over 15x versus the US (FICCI-EY M&E Report 2026, Company estimates). This is not a temporary imbalance but a structural deficit that has persisted for decades and represents one of the most significant long-term growth opportunities in the global exhibition industry.

ecosystem, where multiplex-led growth drives higher realizations, improved asset productivity and a superior consumer experience. The transition is not a future aspiration but an observable, measurable reality.

The full magnitude of the opportunity is perhaps best appreciated through a single comparison: if India were to reach even half of Chinas screen density of 64 per million, it would require approximately 45,000 screens — four times the current base (FICCI-EY M&E Report 2026, Company estimates). This is not a near-term target; it is a measure of the multi-decade runway available to disciplined, capital-efficient exhibitors willing to build where India is growing.

The Companys Asset light model and Smart Screen format are purpose-built to address this infrastructure gap — enabling expansion into markets that lack organised cinema today, at a unit economics model designed for the realities of emerging catchments. The under-screened India thesis is not a macro narrative; it is the direct strategic rationale for the Companys network expansion program.

4b. Indian Box Office Performance in CY26

Box office witnessed a strong and broad-based recovery in CY26 versus CY25, led by a meaningful revival in Hindi cinema, a sharp rebound in English content, and steady contribution from regional films.

Hindi, including Hindi-dubbed titles, recorded healthy growth of 18%, while English box office surged 55%, reflecting a broad-based recovery in theatrical demand and a deeper contribution from a wider range of successful titles. Regional language performance remained broadly stable, providing resilience to the overall content mix. Importantly, the recovery was not driven by a handful of outliers alone, but by a much wider spread of successful films across categories.

Indias theatrical box office crossed INR 1,33,950 Mn in CY25, the highest ever, while the number of films crossing the INR 1,000 Mn mark rose to 37 in CY25, underlining a clear expansion in box-office depth. Hindi cinema was a key driver of this momentum, with CY25 emerging as its best-ever year at INR 55,040 Mn gross.

The year was further defined by the emergence of marquee blockbusters that reset benchmarks for theatrical performance and audience appetite. Dhurandhar crossed INR 5,000 Mn worldwide within just 10 days of release, while Dhurandhar: The Revenge went on to become a historic box-office phenomenon, crossing INR 17,000 Mn worldwide and becoming the first Hindi film to surpass INR 10,000 Mn net in India. Kantara: A Legend – Chapter 1 also delivered a massive run, crossing INR 5,000 Mn in India and finishing with more than INR 8,000 Mn worldwide, reinforcing the continued strength of high-conviction regional-origin stories with pan-India appeal.

This blockbuster momentum provided the foundation for a consistently strong year across quarters, with each period contributing meaningfully to the overall recovery and expansion of theatrical demand. Rather than being concentrated in isolated release windows, audience traction remained broad-based across Hindi, Hollywood, and Regional content, supported by a healthier release pipeline, stronger performance of mid-to-large-scale titles, and continued adoption of premium formats.

The quarterly performance below reflects how this momentum built through FY26, beginning with a strong Q1, accelerating sharply in Q2, consolidating further in Q3, and culminating in a record Q4 for the Indian box office.

Q1 FY26 (April–June 2025): Q1 FY26 saw Indias box office start strongly, led by broad-based growth across Hindi and Hollywood content. Hindi collections rose 38% YoY, driven by a steady run of successful titles including Raid 2, Sitaare Zameen Par, Kesari Chapter 2, Housefull 5, and Jaat. Importantly, the quarters performance was underpinned not by a few outliers, but by a healthy flow of consistently performing films, with 10 titles crossing INR 1,000 Mn and 3 exceeding INR 2,000 Mn. Hollywood collections grew 72% YoY, led by Mission Impossible, Final Destination, Ballerina, and F1, with premium and experiential formats recording 20% YoY growth in admissions. Regional content remained stable, supported by Good Bad Ugly, Thudarum, and Tourist Family.

Q2 FY26 (July–September 2025): Q2 FY26 was one of the strongest quarters for the Indian box office in recent times, with momentum accelerating across Hindi, Hollywood, and Regional content. Hindi cinema saw a strong revival, led by both content-driven successes such as Saiyaara and Mahavatar Narsimha and star-led titles like War 2 and Jolly LLB 3. Hollywood collections crossed INR 5,000 Mn in Q2, more than doubling YoY, led by Jurassic World, The Conjuring, Superman, Demon Slayer, Fantastic Four, and F1. Regional cinema remained equally robust, with over 100% growth in Kannada, around 50% growth in Malayalam, and strong performances from key Tamil and Telugu titles.

Q3 FY26 (October–December 2025): Q3 FY26 reflected the continued strength of theatrical demand, led by strong contributions from Hindi, Hollywood, and Regional cinema. Hindi box office delivered its strongest year ever, crossing INR 55,000 Mn and growing 18% YoY, supported by a healthier genre mix, a steady release slate, and large tentpole films such as Dhurandhar, which became the highest-grossing Hindi film of all time at around INR 10,000 Mn. Hollywood posted its best post-pandemic year in India, with collections of INR 14,000 Mn, up 49% YoY, driven by a stronger and more consistent content slate. Regional box office grew 4% YoY overall, with standout performances from Gujarati, Kannada, and Malayalam cinema, reflecting the increasing depth and diversity of regional content.

Q4 FY26 (January–March 2026): Q4 FY26 marked the industrys best-ever Q4, with India box office collections reaching a record INR 35,000 Mn, up 19% YoY. The quarter was driven by a significant rise in the share of Hindi box office and was achieved despite delays in major tentpole releases such as Toxic and Jan Nayagan. A major highlight of the quarter was Dhurandhar: The Revenge, which emerged as the highest-grossing movie of all time, further reinforcing the strong momentum in Hindi cinema. At the same time, Hollywood and regional content continued to provide healthy support, contributing to a balanced box office performance.

4d. Noticeable Trends in the Movie Exhibition Industry

Rise of Original Hindi Content 1

After a prolonged slump, Hindi cinema found its footing with a clear pivot to strong scripts, fresh narratives, and story-driven content. The era of solely star-led films is giving way to content-driven cinema — a trend that is healthy for the industry as it broadens the pool of films capable of delivering strong theatrical returns.

Premium Formats Driving

3 Yield Improvement

IMAX, 4DX, Dolby, ScreenX, and ICE formats continue to command a significant premium — both in ticket price and audience satisfaction. The shift toward experiences that cannot be replicated at home is driving audiences willingness to pay more per visit.

Pan-India Appeal of Regional Cinema	2
The success of Kantara: Chapter 1 — a Kannada film that became a national phenomenon — is the latest validation of pan-India regional cinema. Telugu, Malayalam, Tamil, and Kannada films continue to cross linguistic barriers, dubbing into Hindi and other languages to capture audiences nationwide. This deepens the theatrical content pipeline and reduces reliance on any single language segment.
Re-releases as a Sustainable	4
Revenue Stream
The success of re-releases — a strategy PVR INOX pioneered at scale — has validated the concept across the industry. Re- releases of classic films serve multiple purposes: filling gaps in the release calendar, attracting new audiences to beloved content, and generating strong margins due to lower film hire costs. In FY26, re-releases continued to contribute meaningfully to total admissions and GBOC.

Alternative & Non-Traditional

5 Content

Anime screenings (notably Demon Slayer and Dragon Ball films), concert films, comedy specials, sporting event screenings transitions are adding new layers to the theatrical content mix. This diversification insulates exhibitors from the volatility of the Hindi theatrical release calendar and broadens the audience catchment.

Social Media as a Discovery

6 Engine

Social media platforms — YouTube, Instagram, and increasingly influencer-driven campaigns — have become the primary discovery channel for theatrical content among Gen Z and Millennial audiences. This structural shift has significant implications for how studios and exhibitors market films. PVR INOXs own digital marketing capabilities — including its Salesforce-powered CRM platform and its growing social media presence — are well-positioned to leverage this channel.

FACTORS AIDING THE GROWTH OF MULTIPLEXES IN INDIA

1. The ‘Infinite Content Era — AI-Driven Creative Abundance

The most structurally significant shift in FY26 is the arrival of artificial intelligence as a production-scale force across the entertainment value chain. AI is democratising content creation at every level — from visual effects and dubbing to scriptwriting and regional-language localization — flooding every platform with more content than consumers can absorb. Yet despite this abundance, attention remains finite and increasingly selective.

The paradox is profound: in a world of infinite content, the scarce commodity is not content itself but content that is authentically human, culturally rooted, and experientially irreplaceable. For cinema, this is a structural tailwind disguised as a threat. When everything is available everywhere, the experience that cannot be replicated at home the –Big Screen experience, the Dolby sound wall, the collective gasp of a full auditorium command an ever-larger premium. Taste, creative vision, and cultural authenticity are becoming the defining differentiators in a marketplace saturated with algorithmically generated content. Premium large-format attendance grew from 71% of moviegoers in 2023 to 77% in 2024 to 84% in 2025 — three consecutive years of expansion, tracking precisely against the rise of home streaming. The big screen is uniquely positioned to be the home of stories that demand to be seen at their largest and loudest.

2. Cinema and OTT: A Complementary Ecosystem, Not a Zero-Sum Contest

The dominant narrative of the last half-decade — that streaming platforms would progressively erode theatrical attendance — is being replaced by a more empirically grounded reality. OTT in India is maturing, consolidating, and in several segments, reaching a plateau. As it does, a more nuanced and ultimately more encouraging picture is emerging: cinema and streaming are not competitors for the same consumer moment. They serve fundamentally different human needs — and the evidence increasingly shows they are growing together, not at each others expense. The data makes this coexistence visible.

Indias aggregate OTT monthly active user base grew just 2% in the past twelve months — against 20% over the prior three years — signaling rapid saturation in the established digital entertainment market. 71% of all video OTT subscriptions in India are bundled — packaged with telecom data packs, e-commerce memberships, or aggregator plans — meaning most subscribers access streaming as a utility, not as a destination. Cinema, by contrast, is a chosen, direct-pay, high-engagement experience. They occupy different positions in the consumers entertainment hierarchy: streaming fills idle time, while cinema fills a social and experiential need that no algorithm can replicate. The GCF Consumer Survey 2026 confirms this globally — the most frequent streamers are, by a wide margin, the most frequent cinemagoers. These are simply high movie-consumption households who love film in all its forms.

3. Premium Content Comes Back to the Big Screen

The most consequential shift in entertainment in FY26 is studios rediscovering that cinema is not a legacy distribution channel — it is the most powerful commercial amplifier a story can have. The proof is unambiguous. Lilo & Stitch was originally planned as a streaming release, but Disney reversed that decision and sent it to theaters. The result: USD 1,038 Mn at the global box office, making it the fourth-highest-grossing film of CY25. In India, the same logic is playing out through streaming IP migrating to cinema. A major series that built a massive subscriber base on an OTT platform is now releasing its cinematic chapter as a movie in theatres — because the gains from theatrical are structurally different.

4. Digital Creates the Craving, Live is the Feast

Perhaps the most counter-intuitive consumer insight of FY26 is the relationship between digital consumption and the hunger for physical experience — they are not in opposition but form a self-reinforcing loop. The more deeply consumers are immersed in digital content, the more intensely they crave the physical, shared, and sensory experiences that screens cannot deliver.

Indias live entertainment sector is experiencing this dynamic at scale. Premium ticketing for live events grew approximately 100% year-on-year in FY26. Sports sponsorship in India crossed USD 2 billion, a new milestone that reflects both the commercialization of live experiences and the consumer appetite underpinning it. Tier 2 and Tier 3 cities now account for roughly 50% of total live event volumes in India — a dramatic shift from the metro-dominated model of just five years ago — signaling that the experience economy has moved decisively beyond the top eight cities. Cinema sits at the most accessible point of this live experience spectrum — the most affordable premium out-of-home entertainment available to the Indian consumer, available year-round, in over 113 cities.

5. The Wellness and Wellbeing Economy — Cinema as Mental Health Infrastructure

The GCF Consumer Survey 2026 found that over 9 in 10 regular cinemagoers globally say attending the cinema is important to their overall sense of wellbeing. In a post-pandemic world where mental health, loneliness, and digital fatigue are mainstream concerns, cinema is being reframed — not as a leisure option competing with OTT — but as social infrastructure that addresses genuine human needs: community, shared emotion, wonder, and the psychological relief of being fully absorbed in another world for two hours.

6. Indias 40 Million Affluent Households — The New Cultural Renaissance Consumer

FY26 has witnessed a powerful convergence of rising affluence and a deepening pride in Indian cultural identity. India now has approximately 40 million affluent households — and this number is growing. This cohort is driving a revival of interest in Indian history, mythology, heritage, and religion that is not nostalgia but aspiration: a desire to see Indias cultural inheritance rendered with world-class production values, on the biggest screens possible.

The box office in FY26 validated this comprehensively. The years biggest blockbusters were overwhelmingly rooted in Indian mythology, historical heroism, and cultural identity — and they were consumed with an intensity that purely commercial entertainments rarely generate. Indias domestic box office collections in 2025 made it the highest-grossing year in the history of Indian cinema, a milestone that reflects not just content quality but a consumer culture increasingly proud of — and willing to pay for — stories that celebrate who they are. For the multiplex industry, this represents both a content opportunity and a brand-positioning opportunity: cinema as the place where India celebrates its own stories at their most spectacular.

COMPANY OVERVIEW & PERFORMANCE IN FY26

PVR INOX Limited is Indias largest multiplex chain, operating 1,782 screens across 355 properties in 113 cities in India and Sri Lanka. During the year, the Company opened 93 new screens across 15 cinemas and exited 18 underperforming screens, delivering a net addition of 75 screens — the highest annual addition in recent years. The companys premium format portfolio spans Directors Cut, Insignia, LUXE, IMAX, ICE, P[XL], BIGPIX, ScreenX, 4DX, MX4D, Playhouse, Kiddles, Onyx, Sapphire, and Club, with premium screens constituting approximately 16% of the overall portfolio.

FISCAL 2026 _ A STRONG GROWTH YEAR

Building on the three pillars of Operational Excellence, Prudent Capital Allocation, and Debt Reduction — and aided by a significantly stronger content environment — the Company delivered a meaningful recovery in financial and operational performance.

I. Operational Excellence

In FY26, PVR INOX sharpened its growth strategy by focusing on two clear priorities: actively driving footfalls and expanding monetization through F&B. Through targeted consumer initiatives, alternate programming, premium formats, and new food-led offerings, the Company moved beyond a passive exhibition model to build a more diversified and demand-led growth engine.

• From Managing Demand to Actively Manufacturing Footfalls

PVR INOX has strategically evolved its exhibition model from a largely content-dependent approach to one where demand is systematically created through pricing innovation, alternate programming, experiential formats, and targeted customer segmentation — enabling more consistent and resilient audience engagement across its circuit. This strategic shift recognises that the post-pandemic consumer is more value-conscious, choice-driven, and experience-led, requiring exhibitors to play a far more active role in driving cinema consumption.

Weekday Centric Consumer Offerings: A key pillar of this strategy has been the launch of Blockbuster Tuesdays, which has emerged as one of the most effective weekday footfall drivers in the industry. In FY26, 3.9 Mn unique transactors have participated in Blockbuster Tuesdays, accounting for close to 22 Mn tickets booked (15% of all tickets booked in FY26), clearly demonstrating the programs success in reviving weekday cinema-going behaviour and expanding the active customer base.

Building on this momentum, the Company has rolled out a suite of consumer-centric weekday and F&B value propositions tailored to distinct demographics—Seniors Day Monday for senior citizens, Wow Wednesdays for women, Thursday Specials for students, and Fun Fridays for younger audiences. These targeted initiatives are designed to create strong perceived value, improve weekday occupancies, and deepen engagement across diverse consumer segments, while maintaining overall yield discipline.

Sales of Gift Cards and Vouchers: In the highest ever sales of gift cards and vouchers worth INR 780 Mn for the year, contributing 2.8 Mn footfalls which converts into 2% to overall annual admissions. The sales also help lock in consumers to transact through the Companys website and app, supporting its ticket-booking market share relative to BookMyShow and District.

Brand Partnerships: In response to consumer sentiment toward its F&B offerings, PVR INOX partnered with EazyDiner to offer discounts of up to 25% on F&B transactions across all cinemas. This resulted in achieving a higher spends by the consumers due to the lucrative offering (all funded by the partner) ‘average value of transaction (AVT) of INR 675 (33% higher than the normal bill value for the year.

Banking & Financial Alliances: During the year, PVR INOX partnered with 22 financial institutions, including HDFC, Axis Bank, ICICI Bank and Kotak Mahindra Bank, which offered discounts on tickets and F&B purchases. These offers were scaled across digital channels, box offices and F&B concession counters. This helped drive brand stickiness and increase the usage of the PVR INOX app among patrons.

Alternate Programming: In parallel, PVR INOX has continuously pursued alternate programming to supplement the traditional film slate. This includes successful theatrical re-releases, live IPL match / sports screenings, concerts, comedy shows, and curated content experiences. Re-releases and other initiatives put together contributed 2 Million admits in FY26.

• Driving High-Margin Growth through F&B Premiumization, Introduction of owned Food Brands and Ecosystem Expansion

Food & Beverage continues to be a core growth and profitability engine for PVR INOX, with the Company executing a multi-pronged strategy focused on premiumization, brand-building, access-led value, and expansion beyond the traditional cinema ecosystem.

Foodcourt JV: The Company forayed into the food-court business through a Joint Venture with Devyani International on 14th May 2024.This was done with the strategic objective to diversify into the pre-ticketed F&B segment, shifting from a model dependent on movie footfalls to a more predictable, walk-in driven consumption business. Till date, three food courts are operational in Kota, Prayagraj, and Leh, with further expansion planned for this business.

Launch of Owned Food Brands: The Company has also entered the owned food brand space for the first time with the launch of ‘Dog Father, a scalable hot dog brand, along with Frytopia, Cine-Caf? and other brands. Along with other in-house concepts, these brands are being incubated within the controlled cinema environment and are expected to expand beyond the circuit over time, opening up new opportunities for external brand licensing and retail growth beyond theaters.

New Premium F&B format: The introduction of premium dining formats such as the ‘Dine-In cinema in Bengaluru represents another step-change in F&B monetization. By integrating freshly prepared multi-cuisine meals with in-seat service, lounge-style foyers, and curated zones, PVR INOX is repositioning the multiplex as a lifestyle and social destination, materially lifting both ticket and food realizations.

F&B Bundle: The Company has also launched ‘Bundle under which guests receive 50% additional F&B value when booking food along with tickets, materially improving food attachment rates, boosting Spend Per Head (SPH), and strengthening perceived consumer value without diluting margins.

Collectively, these initiatives to drive footfalls and expand SPH have delivered tangible outcomes, with FY26 recording the highest Average Ticket Price (ATP) and Spend Per Head (SPH) since the pandemic.

Going Beyond the Cinema landscape (Outdoor Catering): PVR INOXs innovative outdoor catering initiative has brilliantly extended its iconic cinema-style F&B experience—featuring customizable popcorn, nachos, hot dogs, pizzas, salads, and dim sums—beyond multiplexes to elevate events like private parties, corporate gatherings, and special celebrations. This venture has performed exceptionally well, generating INR 180 Mn from outdoor events in FY26 while creating additional revenue opportunities through a strategic presence at high-profile occasions. These included INR 0.75 Mn in popcorn at Lollapalooza, festivals such as Navratri and Durga Puja, upcoming F&B events, concerts, school outings, and established IPs like IPL matches, where the Company has stalls at 30–40% of games.

Use of ‘AI nudge and real time F&B offers (to increase consumption in ‘volume): Through a partnership with Salesforces (an AI-powered Customer Relationship Management platform) data infrastructure, PVR INOX has built an AI-driven engine that tracks consumption behaviour in real time. Under its ‘Plus One strategy, the Company prompts a customer to purchase one item if they have not purchased anything and one additional item if they have already purchased three items.

• Cost Management

Rent & CAM Savings: Rent and CAM renegotiations with developers, delivering savings of INR 567 Mn in FY25 and INR 609 Mn in FY26.

Other Fixed Cost Savings: Fixed costs excluding Rent and CAM have declined by a CAGR of 1.3% per annum per screen since FY20. Manpower Costs have also declined by a CAGR of 1% per annum per screen since FY20. This has been enabled by a leaner organizational structure and optimized cinema staffing. Tight control over electricity consumption has kept power costs flat despite rising tariffs. Further, in FY26, PVR INOX implemented several energy-efficiency measures across its cinema network, including APFC installations at five properties, solar thermal collectors at five locations and EC fan retrofits across 12 cinemas, which achieved energy savings of up to 50%. Rooftop solar systems were also commissioned at three cinemas. These initiatives resulted in a 3% reduction in electricity costs compared with the previous year.

II. Prudent Capital Allocation & Cash Flow Management

A. Asset-Light Expansion Continues to Scale

The pivot to an asset-light growth model, initiated in FY25, gained significant momentum in FY26. During FY26, the Company added 51 screens under its capital-light strategy, including 22 screens under the FOCO model and 29 screens under the asset-light model. It has also signed 138 additional screens under the capital-light model, comprising 52 screens under FOCO and 86 screens under the asset-light model.

B. Controlled Capital Expenditure

Total capital expenditure for FY26 remained disciplined at approximately INR 2,542 Mn, moderating from INR 3,335 Mn in FY25 and significantly lower than INR 6,344 Mn in FY24. In FY26 capex investment was targeted in premium format upgrades, technology (ticketing, CRM, AI-based pricing), and select new screen openings.

C. Strong Free Cash Flow Generation

The Companys focus on operational discipline and capital efficiency translated into robust free cash flow of approximately INR 7,901 Mn in FY26, reinforcing a consistent and improving trend.

D. Divestment of Non-Core Asset

In FY26, PVR INOX divested its stake in Zea Maize, the owner of the premium popcorn brand 4700BC, to FMCG major Marico for a consideration of INR 2,268 Mn. This was a timely monetization of a non-core asset aimed at unlocking shareholder value. The transaction generated a strong return for PVR INOX. The proceeds from the transaction have been utilized to reduce debt.

III. Debt Reduction & Balance Sheet Strengthening

The Company continued its systematic deleveraging journey in FY26. Net Debt has reduced to approximately INR 1,619 Mn as of March 31, 2026, down from INR 9,522 Mn as of March 31, 2025 — an exceptional 83% reduction in just one year. Improved operational performance in FY 26, coupled with disciplined capital allocation, supported strong free cash flow generation, enabling both debt repayment and continued investment in growth.

The Company maintained its CRISIL credit rating of AA with Stable Outlook — a testament to the quality of its balance sheet management.

IV. Nurturing Growth Assets

PVR INOX Pictures — Film Distribution

PVR INOX Pictures, the Companys film distribution subsidiary, delivered performance broadly in line with the previous year. The business reported revenue of approximately INR 3,705 Mn and an EBITDA of INR 299 Mn, supported by the distribution of several of the years largest theatrical releases. The distribution business continues to be an established, high-return growth asset, generating significant synergies with the Companys exhibition business

Financial Performance & Analysis

The discussion in this section relates to the standalone financial results for the year ended March 31, 2026. The financial statements of the Company have been prepared under the Indian Accounting Standards (referred to as Ind AS), prescribed under Section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standards) Rules as amended from time to time. Significant accounting policies used in the preparation of the financial statements are disclosed in the notes to the standalone financial statements.

The table below gives an overview of the standalone financial and operating results for FY 2025-26 (FY26) compared with FY 2024-25 (FY25). Further comparative financials after adjusting for the impact of Ind AS 116 have also been reproduced below for both financial years. The MD&A section below has been drafted based on Ind AS 116 adjusted numbers for ease of understanding.

	FY 2025-26				FY 2024-25
PARTICULARS (D IN MILLION)	FY 2025-26	Ind AS 116 Impact Impact	Adjusted for Ind AS 116 Adjusted	% of Revenue	FY 2024-25	Ind AS 116 Impact Impact	Adjusted for Ind AS 116 Adjusted	% of Revenue	Growth/ De-growth
Income
Revenue from operations	63,912		63,912	99%	54,424		54,424	98%	17%
Other income	1,770	871	899	1%	1,637	790	847	2%	6%
Total Income	65,682	871	64,811	100%	56,061	790	55,271	100%	17%
Expenses
Movie exhibition cost	15,907		15,907	25%	13,111		13,111	24%	21%
Consumption of food and beverages	4,656		4,656	7%	4,315		4,315	8%	8%
Employee benefits expense	6,952		6,952	11%	6,461		6,461	12%	8%
Other operating expenses	15,769	-12,187	27,956	43%	15,219	-11,598	26,817	49%	4%
Total Expenses	43,284	-12,187	55,471	86%	39,106	-11,598	50,704	92%	9%
EBITDA	22,398	13,058	9,340	14%	16,955	12,388	4,567	8%	105%
EBITDA Margin (%)	34%		14%		30%		8%		+615 bps
Finance costs	7,301	5,801	1,500	2%	8,060	6,185	1,875	3%	-20%
Depreciation and amortization expense	12,563	7,989	4,574	7%	12,646	7,922	4,724	9%	-3%
Profit Before	2,534	-732	3,266	5%	(3,751)	-1,720	(2,031)	-4%	NM
Exceptional Items and Tax
Exceptional Items (net gain)	(800)		(800)	-1%	-	-	-		N.A.
Profit Before Tax	3,334	-732	4,066	6%	(3,751)	-1,720	(2,031)	-4%	NM
PBT Margin (%)	5%		6%		-7%		-4%		+995 bps
Tax expense	649	-159	808	1%	(982)	-441	(541)		NM
Profit After Tax	2,685	-573	3,258	5%	(2,769)	-1,279	(1,490)		NM
PAT Margin (%)	4%		5%		-5%		-3%		+772 bps
Operating Numbers
Locations (Nos.)	358		358		349		349		3%
Screens (Nos.)	1,789		1,789		1,714		1,714		4%
Admits (Mn)	150		150		137		137		10%
Gross ATP	280		280		259		259		8%
Gross SPH	147		147		134		134		10%
Occupancy %	26.2%		26.2%		23.0%		23.0%		+312 bps

Note: "Ind AS 116 Impact" above is computed as Reported amount less the Ind AS 116 Adjusted amount (i.e. Adjusted = Reported - Impact), consistent with the Companys standalone financial workings.

Note: Exceptional items for FY26 comprise a net gain of J 800 million, consisting of a gain of J1,270 million (net of expenses) on disposal of the Companys investment in Zea Maize Private Limited, partly offset by an impact of J392 million on account of the new Labour Codes notified during the year and an impairment of J78 million relating to capital work-in-progress under dispute with the landlord. There were no exceptional items in FY25.

I. REVENUE

Total income (Ind AS 116 adjusted) increased by 17% or C 9,540 million during the year ended March 31, 2026 as compared to the previous year ended March 31, 2025.

Particulars (D in Million)	FY 2025-26	FY 2024-25	% Change
Adjusted for Ind AS 116
Income from sale of movie tickets	35,086	29,424	19%
Sale of food and beverages	20,725	17,335	20%
Advertisement income	4,621	4,461	4%
Convenience fees	2,403	2,106	14%
Other operating revenue and Other Income	1,976	1,945	2%
Total	64,811	55,271	17%

A. Income from Sale of Movie tickets

Income from the sale of movie tickets increased by 19% or C 5,662 million during the year ended March 31, 2026, as compared to the previous year ended March 31, 2025. The increase was mainly due to a 10% increase in admissions and an 8% increase in average ticket price (ATP) in FY26 as compared to FY25.

B. Income from Sale of Food and Beverages

Income from the sale of Food & Beverages increased by 20% or C 3,390 million during the year ended March 31, 2026, as compared to the previous year ended March 31, 2025. The increase was driven by higher admissions and a 10% increase in Spend per Head (SPH).

C. Advertisement Income

Advertisement income increased by 4% or C 160 million during the year ended March 31, 2026, as compared to the previous year ended March 31, 2025.

D. Convenience fees

Convenience fees increased by 14% or C 297 million during the year ended March 31, 2026, as compared to the previous year ended March 31, 2025, broadly in line with the growth in admissions.

E. Other operating Revenue and Other Income

Other operating revenue including other income increased by 2% or C 31 million during the year ended March 31, 2026, as compared to the previous year ended March 31, 2025. It includes income from film production and distribution, virtual print fees, rental and food court income, management fees, interest income, and other non-operating income.

II. Expenses

Total cost (including finance costs and depreciation, Ind AS 116 adjusted) increased by 7% or C 4,242 million during the year ended March 31, 2026, as compared to the previous year ended March 31, 2025. Total cost comprised of the following

Particulars (D in Million)	FY 2025-26	FY 2024-25	% Change
Adjusted for Ind AS 116
Variable Cost
Movie exhibition cost	15,907	13,111	21%
Consumption of food and beverages	4,656	4,315	8%
Total Variable Cost	20,563	17,426	18%
Fixed Cost
Employee benefits expense	6,952	6,461	8%
Rent and CAM	16,726	15,898	5%
Electricity and Water charges	3,795	3,921	-3%
Other operating expenses	7,435	6,998	6%
Total Fixed Cost	34,908	33,278	5%
Finance costs and depreciation
Finance costs	1,500	1,875	-20%
Depreciation and amortization expense	4,574	4,724	-3%
Total Cost	61,545	57,303	7%

A. Movie Exhibition cost

Movie Exhibition cost increased by 21%, or C2,796 million, during the year ended March 31, 2026, compared to the year ended

March 31, 2025, primarily due to an increase in revenue from the sale of movie tickets. This cost is fully variable and linked to the sale of movie tickets.

Particulars	FY 2025-26	FY 2024-25
Movie Exhibition cost (as a % to Box office Revenue)	45.3%	44.6%

B. Consumption of food and Beverages

Consumption of food and beverages increased by 8%, or C341 million, during the year ended March 31, 2026, compared to the year ended March 31, 2025, primarily due to an increase in revenue from the sale of food and beverages. This cost is fully variable and is linked to the sale of Food & Beverages.

Particulars	FY 2025-26	FY 2024-25
Cost of Goods sold (as a % to Food & Beverages Revenue)	22.5%	24.9%

C. Employee Benefit Expenses

Employee benefit expenses increased by 8%, or C491 million, during the year ended March 31, 2026, compared to the year ended

March 31, 2025.

D. Rent and Common area maintenance (CAM)

Rent and CAM expenses (Ind AS 116 adjusted) increased by 5%, or C828 million, during the year ended March 31, 2026, compared to the year ended March 31, 2025.

E. Electricity & Water Charges

Electricity and water expenses decreased by 3%, or C126 million, during the year ended March 31, 2026, compared to the year ended

March 31, 2025.

F. Other operating expenses

Other operating expenses primarily include Repairs and maintenance, Marketing expenses, Rates and taxes, Security service charges, Travelling and conveyance, Legal and professional fees, and other expenses. This expense has increased by 6% or C437 million for the year ended March 31, 2026, as compared to March 31, 2025.

G. Finance costs

Finance costs (Ind AS 116 adjusted) include interest on term loans, banks and other financial charges. Finance costs decreased by 20% or C375 million for the year ended March 31, 2026, as compared to March 31, 2025, primarily on account of repayment of long-term and short-term borrowings during the year.

H. Depreciation and amortization expense

Depreciation and amortization expense (Ind AS 116 adjusted) decreased by 3% or C150 million for the year ended March 31, 2026, as compared to March 31, 2025.

Balance Sheet

The following table sets forth selected items from the standalone Balance Sheet:

Particulars (D in Million)	FY 2025-26	FY 2024-25	% Change
Assets
Non-current assets	1,46,161	1,53,490	-5%
Current assets	8,623	8,659	-0.4%
Total	1,54,784	1,62,149	-5%
Equity and liabilities
Equity	73,369	70,708	4%
Non-current liabilities	58,654	66,752	-12%
Current liabilities	22,761	24,689	-8%
Total	1,54,784	1,62,149	-5%

I. Non-Current Assets

Non-Current Assets include Property, Plant and Equipment, Right-of-use assets, Goodwill, Intangible Assets, Capital work-in-progress, Investments in subsidiaries & joint venture, Security deposits to mall developers, Deferred tax assets, and other non-current assets. Non-current assets decreased by 5%, primarily on account of depreciation on Property, plant and equipment and Right-of-use assets, and a decrease in Investments in subsidiaries pursuant to the disposal of the Companys stake in Zea Maize Private Limited during the year.

II. Current Assets

Current Assets include Inventories, Trade Receivables, Cash and cash equivalents, and other current assets. Current assets remained broadly stable, with a marginal decrease primarily on account of a decrease in other current assets, partly offset by an increase in trade receivables and inventories.

III. Equity

Equity comprises equity share capital and other equity. Equity increased by 4%, primarily on account of the profit earned during the year as compared to a loss in the previous year.

IV. Non-current Liabilities

Non-current liabilities include Borrowings, Lease liabilities, the non-current portion of Gratuity and leave encashment, other financial liabilities, and other non-current liabilities. Non-current liabilities decreased by 12%, primarily on account of repayment of long-term borrowings and a reduction in the non-current portion of lease liabilities during the year.

V. Current Liabilities

Current liabilities include Short-term Borrowings, Trade payables, other financial liabilities, current portion of lease liabilities, Gratuity and leave encashment, and other current liabilities. Current liabilities decreased by 8%, primarily on account of repayment of short-term borrowings and a decrease in trade payables and other financial liabilities, partly offset by an increase in the current portion of lease liabilities and other current liabilities.

Ratios

Ratio	Numerator	Denominator	FY 2025-26	FY 2024-25	% Change
Current Ratio	Total current assets	Total current liabilities	0.38	0.35	8%
Debt - Equity Ratio	Total Borrowings	Total Equity	0.10	0.21	(51%)
Debt Service Coverage Ratio	Loss before tax + Depreciation and amortization expense + Finance costs - Other income	Interest on debentures, term loans and bank and others + Principal repayment of Long Term Borrowings excluding prepayments	4.21	2.43	73%
Return on Equity	Profit / (Loss) for the year	Average Total Equity	3.73%	(3.84%)	197%
Inventory Turnover Ratio	Consumption of food and beverages	Average Inventory (Food and beverages)	9.97	10.05	(1%)
Trade Receivables Turnover (times)	Revenue from operations	Average Trade Receivables	29.52	26.30	12%
Trade Payables Turnover (times)	Movie exhibition cost + Consumption of food and beverages + Other operating expenses	Average Trade Payables	6.45	4.75	36%
Net Capital Turnover (times)	Total income	Total current assets - Total current liabilities	(4.65)	(3.50)	33%
Net Profit Ratio	Profit / (Loss) for the year	Total income	4.09%	(4.94%)	183%
Return on Capital Employed	EBIT = Profit / (Loss) before tax + Finance costs	Capital Employed = Total Equity + Total Borrowings - Other intangible assets - Goodwill	47.12%	15.88%	197%
Return on Investments	Income generated from investments	Average investments	9.56%	13.44%	(29%)

Notes:

1) For computing the above ratios, reported standalone numbers are considered. 2) Ratios include the impact of Ind AS 116 ‘Leases.

3) Figures in brackets represent negative values, consistent with the audited standalone financial statements.

CORPORATE GOVERNANCE

PVR INOXs commitment to corporate governance is embedded in its vision of sustained business excellence and long-term stakeholder value creation. The Company operates with the highest levels of transparency, accountability, and fairness in its interactions with shareholders, employees, government, lenders, and all stakeholders. The Board of Directors, through the Audit Committee, Nomination & Remuneration Committee, and other sub-committees, provides strategic oversight and ensures alignment with regulatory requirements and ethical standards.

In FY26, the Company strengthened its governance framework through further development of its data governance policies (particularly around customer data privacy and digital marketing), enhanced whistleblower mechanisms, and continued investment in cyber security infrastructure.

INTERNAL CONTROL SYSTEMS AND THEIR ADEQUACY

Our company prioritises running a well-organised and efficient business. To achieve this, we have implemented a robust system of internal controls, procedures, and policies. These controls focus on key areas like compliance, asset protection, fraud and error prevention, and maintaining accurate and complete financial records. This system is carefully tailored to fit the size and complexity of our operations.

We take internal controls seriously. This is reflected in the active role of our Audit Committee, which works closely with internal and statutory auditors, as well as management, to address any issues within their purview.

Throughout the year, we conducted a thorough assessment of our controls. This assessment found no significant weaknesses in either their design or operation that would require reporting.

We have partnered with KPMG, a leading independent auditor, to oversee our internal audit activities. We conduct these audits in accordance with a yearly plan, which the Audit Committee reviews collaboratively. The internal audit process focuses on key areas

RISK MANAGEMENT

Content Risk

PVR INOXs business is inherently tied to the theatrical content pipeline. To mitigate the risk of content gaps or underperformance: (a) the Company systematically leverages re-releases to fill calendar gaps with proven, high-quality content at favourable film hire costs; (b) alternative content (anime, concerts, sports, gaming, comedy specials) increasingly fills non-blockbuster weeks; and (c) PVR INOX Pictures provides direct visibility and participation in the distribution value chain.

Competitive Risk (OTT)

While OTT platforms continue to grow in India, evidence from the GCF Consumer Survey 2026 and domestic consumption data suggests that the most frequent streamers are also the most frequent cinema-goers. PVR INOXs response is to make theatrical cinema an experience that streaming cannot replicate — through IMAX, 4DX, immersive sound, premium seating, and the social energy of a multiplex. The sustained growth in premium format attendance validates this strategy.

Macroeconomic & Discretionary Spending Risk

Consumer discretionary spending on entertainment is sensitive to economic cycles, inflation, and income levels. PVR INOX mitigates this through dynamic pricing — maintaining value-oriented options (INR 99–150 tickets on CLD/NCD days, affordable seat tiers) while capturing premiums during peak content events.

such as operations, financial activities, procurement practices, marketing initiatives, employee engagement, and customer relationship management.

The Audit Committee plays a crucial role in ensuring transparency. They review reports provided by both internal and statutory auditors and actively follow up on any suggestions for improvement. Additionally, the committee meets regularly with statutory auditors to gain valuable insights on the effectiveness of our internal control system. They also keep the Board of Directors informed about any significant observations.

In addition to the above measures, we also engage BDO India to conduct multiple quality audits at all our individual cinema locations during the year.

Following an evaluation as defined in Section 177 of the Companies Act, 2013 and Clause 18 of SEBI Regulations 2015, the Audit Committee of the Company has determined that its internal financial controls were sufficient and functioning effectively as of March 31, 2026. This conclusion is also supported by the auditors report on internal financial control.

Window & Piracy Risk

Globally, the perceived shortening of theatrical release windows is reducing cinema attendance — the GCF survey estimates this costs exhibitors 2.2 fewer visits per consumer per year globally. In India, windows have remained relatively longer, and PVR INOX actively advocates within the industry for the maintenance of meaningful theatrical exclusivity windows.

Financial Risks (Interest Rate, Currency, Liquidity, Credit)

PVR INOX manages interest rate risk through a balanced portfolio of fixed and floating rate debt. Currency risk is minimal as operations are predominantly INR-denominated. Liquidity risk is managed through a rigorous cash flow forecasting process and maintenance of adequate cash reserves. Credit risk is managed through an expected credit loss model for trade receivables, with regular review by the Audit Committee.

Regulatory & Compliance Risk

The Company operates across 24 states and UTs, each with distinct regulatory requirements. PVR INOXs dedicated compliance team, supported by external legal advisors, ensures adherence to applicable laws across all jurisdictions. Compliance status is reviewed regularly by the Audit Committee.