The Conversation AJAY BIJLI
Fortune India|April 2021
Covid-19 impacted many businesses, with one of the hardest hit being movie halls. This included PVR, India’s largest multiplex chain. However, it was able to raise funds during the pandemic, says chairman Ajay Bijli. The 54-year-old says his company is now in its revival phase and he isn’t overly worried about movies directly releasing on OTT platforms. He also talks about what keeps him going.
PRERNA LIDHOO

THE PANDEMIC EFFECT

Let’s tackle the elephant in the room. What has been the effect of the Covid-19 pandemic on your business?

This particular year [2020] has been an aberration. I’ve categorised people whose lives got interrupted, and people whose lives have been disrupted. People whose lives were disrupted are the ones who lost their loved ones and stufflike that. That is what I call devastation. For us, it’s an interruption.

From a business perspective, cinemas were asked to shut on March 15 [2020]. 1 They were the first ones to be shut and last ones to open. Any business which equals zero revenue is definitely going to get impacted. But we were fortunate that the belief of people in both PVR and the industry stayed strong. Our first function was to curtail our expenditure. Internal costs had to be curtailed because of no revenue, and then for the external costs which are the fixed costs, which is your rental, we had to go to all the developers in 177 properties. It’s a testimony to the brand that we were able to get rental relief for almost 90% of the properties in almost all malls. We did not pay any rent till we opened again. We knew that the business is going to be volatile, and movies are not going to be coming as regularly, [and] people are still going to be very tentative. Plus, there was a 50% cap on our capacity. So, there was a lot of trepidation.

The second part was to make sure we had enough liquidity to take care of our running costs. You can’t keep raising debt. So, we did a rights issue. And we are happy that we did a ₹300-crore rights issue, that every single investor subscribed to it during a pandemic, where a lot of people had written offthe industry. But that was not enough, because nobody realised that the impact of the pandemic was going to last this long. Finally, we had to do a QIP [qualified institutional placement, a way listed companies can raise money] and we have raised ₹800 crore 2 because we need the liquidity to tide over the volatility that the business may face in the future.

How are you going to use the capital that you have raised?

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