PVR Ltd.'s Growth and Future Prospects

Competition:
Having initially concentrated on the NCR and being the first player in the multiplex business in that region helped PVR to register a healthy growth over the years.

The entry of new players in 2001, however, posed a challenge to PVR even in places where it was the leader (Refer Exhibit VI for major competitors of PVR and their expansion plans). The New Delhi-based Satyam Cineplexes was running 12 screens at three sites in Delhi in 2005 with a total of more than 5000 seats and was to invest over Rs. 25 billion in cineplexes across the country. It was aspiring to become a national player by 2008 by adding 100 screens all over the country.

Though these figures were impressive, the impending competition had the potential to spoil the party for PVR.

The urban population in India in the age group 15-34, the most frequent movie-goers in the country, was expected to grow from 107 million in 2001 to 138 million in 2011.

Moreover, the retail boom in the country coupled with increasing disposable income among the ever-expanding Indian middle class was expected to fuel the growth of multiplexes all across the country. In 2005, the number of footfalls at multiplexes increased by 40-50% over the previous year indicating the growth in the business.