PVR Inox shares crash 8%; What’s behind the sharp drop?

Shares of PVR Inox, India's largest cinema exhibition company, fell sharply on Monday, September 7, after a report said the company had asked a senior executive to leave following an internal investigation into alleged kickbacks involving developers working on cinema properties.

PVR Inox shares fell as much as 7.3% to ₹1,137.60 on the NSE in early trade. The stock was trading at ₹1,131.40, down ₹95.80 or 7.81%, at 10:56 am.

According to the report, Pramod Arora, who was the company's CEO for growth and investment, was asked to leave with immediate effect in April along with a few others after the internal probe allegedly found irregularities. The investigation was reportedly aimed at determining the extent of the alleged wrongdoing and whether others were involved.

The report said the alleged kickbacks could be worth up to ₹200 crore and involved developers associated with the construction of cinema properties. The matter was also discussed by the company's board in recent meetings, according to people familiar with the matter.

The allegations also raise questions over the extent of the involvement, given Arora's reported proximity to PVR Inox's promoters. The company is co-promoted by Ajay Bijli and Sanjeev Bijli, who have led the business since the PVR-INOX merger took effect in February 2023.

PVR Inox did not respond to questions sent by The Economic Times at the time of its report, while messages sent to Arora also went unanswered. The identities of the developers allegedly involved could not be independently established.

PVR Inox buyback: Record date now over

The sharp fall in the stock also comes shortly after the company's ₹300 crore share buyback crossed its record date.

PVR Inox had fixed September 4 as the record date for determining shareholders eligible to participate in the tender offer. Under the buyback, the company will repurchase up to 20.69 lakh shares at ₹1,450 apiece, with the total consideration capped at ₹300 crore.

The buyback price is higher than the current market price, but ₹1,450 is not a guaranteed exit price for every eligible shareholder. The company will accept only a specified number of shares under the tender offer.

The buyback had earlier supported buying interest in PVR Inox, with the stock touching a 52-week high as shareholders looked to participate in the offer. With the record date now behind, some of that event-driven buying interest may have eased.

JM Financial, however, recently raised its earnings estimates for PVR Inox and increased its target price to ₹1,270 from an earlier level, while retaining its 'Add' rating. The brokerage described the buyback announcement as a notable capital-return milestone.

PVR Inox Q1 FY27 results, share performance

PVR Inox reported a consolidated profit after tax attributable to owners of ₹56.5 crore for the June quarter of FY27, compared with a consolidated net loss of ₹54.5 crore in the year-ago period.

Revenue from operations rose 11.91% year-on-year to ₹1,622.20 crore from ₹1,449.60 crore in Q1 FY26.

The company's operating performance also improved during the quarter. EBITDA rose 30.91% to ₹529 crore from ₹404 crore a year earlier, while the EBITDA margin expanded to 32.58% from 27.85%.

Despite Monday's fall, PVR Inox shares have gained around 15% so far in 2026 and are up about 2% over the past year. The stock, however, has delivered negative returns over longer periods, falling around 37% in three years and 14% in five years. On a one-week basis, the shares are down about 4%.

PVR Inox also continued to expand its cinema network. On September 4, the company announced the opening of its first SMART Cinema at ICON Plaza Mall in Muzaffarpur, Bihar.

The four-screen property has 644 seats and takes PVR Inox's total screen count in Bihar to 11. The cinema uses Christie 4K RGB laser projection, 7.1 surround sound and last-row recliner seating.

The company said its SMART Cinema format is aimed at Tier III cities and follows a capital-efficient, asset-light model.

Following the Muzaffarpur launch, PVR Inox operates 1,785 screens across 356 properties in 114 cities in India and Sri Lanka. The company was formed in 2023 following the merger of PVR Limited and INOX Leisure Limited.

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