One of the worst affected sectors due to the coronavirus pandemic and the subsequent lockdown has been movie theatres and multiplexes. Malls and movie theatres were shut down even before the lockdown came into effect.
With another 10 days to go before the lockdown is lifted, PVR, the largest player operating over 821 screens not only in India but even in Sri Lanka, says it will face a severe liquidity crisis if the lockdown lasts 2-3 months.
With the nationwide lockdown set to be lifted on May 3, the government at the centre and in most states have not disclosed what next.
Ajay Bijli, managing director of PVR told CNBC TV18 in an interview that the company’s internal resources to sustain will be challenged beyond this period.
PVR, Bijli told the business channel, controllable and non-controllable costs. Controllable costs include electricity and water bills, which have gone down since its venues are shut.
Then there are also non-controllable expenses such as rent. His take is they may be protected from paying rents for the premises they are occupying since the force majeure clause in the agreement may come useful.
Bijli says if there is no bailout plan from the government, then the company may have to resort to laying off people if the lockdown is extended to 2 months or 3 months. It may be relevant to point out that China kept Wuhan, the city from where it all started, under lockdown for 76 days. Reports say even now the city is not fully open and several commercial establishments continue to remain shut.
PVR’s shares have been quoted at around half its level that was reigning a year ago.