Multiplex operator PVR's Rs 300 crore rights issue, which closed on Tuesday, received a strong response from shareholders at a time when cinema screens across the country have been closed for over four months amid coronavirus outbreak. The PVR rights issue - one of the most successful in the past 15 years in India - was oversubscribed by 2.24 times. Despite uncertainly over future amid closure of screens during the lockdown, shareholders of the company have expressed confidence in the company by making the rights issue successful.
The rights issue, which opened for subscription between July 17 to July 31, received an application for 85.29 lakh shares (worth Rs 672 crore), against issue size of 38.23 lakh shares.
"I would like to express my gratitude to our dear and esteemed shareholders for their support and confidence in PVR and making this rights issue a landmark in media and entertainment in India," said Ajay Bijli, chairman and MD, PVR.
Following the share allotment, the paid-up equity share capital of the company has increased to Rs 55.17 crore consisting of 5.51 crore fully paid-up equity shares of Rs 10 each.
On June 8, the company's board had approved issuance of equity shares of face value of Rs 10 each by way of a rights issue to the eligible equity shareholders of the company for an amount aggregating up to Rs 29,979.16 lakh.
The multiplex operator, which is currently not generating any revenue from exhibition business and related activities as cinemas remain shut, has taken measures to reduce its personnel cost, including salary cuts across various levels in the organisation. The closure of screens in wake of lockdown is likely to have a significant negative impact on profitability and liquidity of the company.
PVR is expected to report near-zero revenues in June quarter as cinemas remained shut for the entire April-June period. For the fourth quarter ended March 31, 2020, the company reported a consolidated net loss of Rs 74.61 crore against a net profit of Rs 46.75 crore in the same period last year. Revenue from operations stood at Rs 645.13 crore against Rs 837.63 crore in the corresponding quarter a year ago.
By Chitranjan Kumar