InvestorQ : PVR looks good to me after the results but I am worried of the market price at over Rs.1700. I am doubtful if I can buy the stock at this price?
Anamika Sodhani made post

PVR looks good to me after the results but I am worried of the market price at over Rs.1700. I am doubtful if I can buy the stock at this price?

Answer
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ishika Banerjee answered.
1 year ago


Don’t worry too much about whether the stock is quoting at Rs.10, Rs.50 or Rs.2,500. It really does not matter. What really matters is how the company is performing and at what valuations the company is available? That is what you need to look at. PVR announced its results for the fourth quarter ended March 2019 and reported an 80% growth in net profits at Rs.47 crore. The total revenues of PVR have also gone up by 43% to Rs.846 crore. The multiplex business is basically a low net margin business since the upfront costs are quite high. PVR has the advantage of being the largest player in India in the multiplex business. The positive for the stocks is that the EBITDA margins have increased sharply from 17.8% to 20% showing better operating traction for the PVR business.

With a full year rolling EPS of around Rs.35, the stock quotes at around 45 times historical earnings. The stock has historically commanded P/E in excess of 40X for long periods of time and that is comparable with other consumer stocks in India. It is a good stock to play the Indian media and consumer story in the long run.