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Stock Report
India Ratings Places PVR and its PP-MLD on RWE
Posted On : 2022-04-07 22:10:16( TIMEZONE : IST )
India Ratings and Research (Ind-Ra) has placed PVR Limited's (PVR) Long-Term Issuer Rating of 'IND AA-' on Rating Watch Evolving (RWE). The Outlook was Negative.
Principal protected market-linked debentures (PPMLDs)* - INR2,500 mn - IND PP-MLD AA-emr / RWE
Fund-based facility - INR650 mn - IND AA- / RWE / IND A1+ / RWE
Ind-Ra continues to take a consolidated view of PVR and its subsidiaries while arriving at the rating, due to the close strategic and operational linkages among them.
The RWE follows the announcement of merger between PVR and INOX Leisure Limited (INOX). Ind-Ra shall resolve the RWE upon the conclusion of the merger and once its resultant impact on the merged entity's market share, revenue and cost synergies, growth trajectories and financial profile becomes clear.
Ind-Ra expects the merged entity to have a dominant market share in Indian movie exhibition industry. Also, higher scale of operations would not only improve revenue efficiencies but also optimise the overall cost structure. The merged entity would also likely have higher bargaining power in negotiating various revenue and cost items such as box office collection, rental rates, advertising rates, convenience fees, among others.
The all-stock merger was approved by the boards of PVR and INOX with a share exchange ratio of 3:10, i.e., three shares of PVR for 10 shares of INOX. Post merger, PVR promoters will have a 10.62% stake while INOX promoters will have a 16.66% stake in the combined entity - PVR INOX Limited with two board seats to each promoter family. Mr. Ajay Bijli would be appointed as the managing director of the merged entity and Mr. Pavan Kumar Jain would be the nonexecutive chairman of the board. The amalgamation is subject to approvals from shareholders, stock exchanges, the Securities and Exchange Board of India and other regulatory agencies.
Shares of PVR Limited was last trading in BSE at Rs. 1893.30 as compared to the previous close of Rs. 1903.00. The total number of shares traded during the day was 32969 in over 2378 trades.
The stock hit an intraday high of Rs. 1912.35 and intraday low of 1866.80. The net turnover during the day was Rs. 62390226.00.
