/Entertainment Buy Inox Leisure, target price Rs 292: Anand Rathi
Entertainment Buy Inox Leisure, target price Rs 292: Anand Rathi

Entertainment Buy Inox Leisure, target price Rs 292: Anand Rathi


Anand Rathi has given a bewitch rating to Inox Leisure with a target stamp of Rs 292. The piece stamp moved down by 0.32 per cent from its old shut of Rs 232.45. The stock’s final traded stamp is Rs 231.70. With very a lot diminished mounted charges (monthly Rs 150m-170m cash-burn; pre-Covid-19: `Rs 700m-750m) and capital spending wanted, Inox’ cash stability Rs 720m and credit available (`750m) would suffice for nearly 8-10 months with none earnings coming in. Also, it had Treasury shares of `1bn market value, which may perchance well properly be liquidated for exigencies and to create elegant distressed sources.

Inox Leisure Ltd., integrated in the twelve months 1999, is a Mid Cap company (having a market cap of Rs 2376.01 Crore) working in Media & Entertainment sector.


For the quarter ended 31-03-2020, the company has reported a Consolidated gross sales of Rs 371.58 Crore, down -27.55 % from final quarter Sales of Rs 512.91 Crore and down -22.40 % from final twelve months identical quarter Sales of Rs 478.84 Crore Company has reported procure profit after tax of Rs -82.15 Crore in most up-to-date quarter.

Entertainment fin-graph

Investment Rationale

The brokerage believes that whereas movie exhibitors will undergo in the instant term and the toddle of recovery will most definitely be slower, they’ll rebound and assemble from pent-up request of as dwelling-sheltering subsides and folks scrutinize a communal journey on return of normalcy.

The brokerage is structurally certain on multiplexes, though cautious of their re-opening. With that in suggestions, it assumes a lockdown in H1 FY21 and subdued H2 occupancy. Which potential truth, the brokerage initiates coverage on Inox Leisure with a Take rating, at a TP of Rs 292 (valuing it at 9x FY22e EBITDA).

Promoter/FII Holdings

Promoters held 51.90 per cent stake in the company as of March 31, 2020, whereas FIIs held 12.2 per cent, DIIs 20.7 per cent and public and other 15.2 per cent.