PVR Inox executive asked to leave amid alleged ₹200 crore kickback probe

PVR Inox asked senior executive Pramod Arora to leave in April after an internal probe into alleged kickbacks worth ₹200 crore from developers involved in cinema projects, The Economic Times reported

This report has been updated to incorporate a clarification from PVR Inox. PVR Inox, India’s largest cinema exhibitor, asked a senior executive to leave in April after an internal investigation into alleged kickbacks received from developers involved in the construction of cinema properties, The Economic Times reported on Saturday.

 

The alleged payments were made over several years and could total as much as ₹200 crore. The allegations centre on Pramod Arora, who was the company’s chief executive officer for growth and investment.

 

The allegations have raised questions over how long the alleged payments continued and whether others within the organisation were aware of them.

 

 

The investigation is aimed at determining the scale of the alleged wrongdoing, and whether other employees or individuals were involved, ET reported. The matter has reportedly also been discussed at recent board meetings.

 

“This was going on for several years,” the report quoted a source as saying.

 

The company became aware of the allegations sometime in April, following which Arora and a few other employees were asked to leave with immediate effect.

 

A declaration signed by Arora also restricted him from joining rival cinema chains and from approaching PVR Inox's existing vendors. The document provides for potential legal action if the restrictions are breached.

 

Arora was closely involved in PVR's expansion into Tier II and Tier III cities, particularly through asset-light formats. These included franchise-owned, company-operated (FOCO) cinemas, and the SMART/Smart Screen initiative.

 

The formats were designed to offer lower-cost, digital-first multiplexes targeting audiences in smaller cities and towns.

 

PVR Inox was formed through the merger of PVR and Inox Leisure in 2023. As of late August, the company has 1,786 screens across 356 properties in 113 cities in India and Sri Lanka. It plans to add another 1,000 screens over the next five years, with franchise-led expansion expected to account for a significant share of the additions.

 

The alleged irregularities come at a time when the company's financial performance has strengthened. PVR Inox clarification  

PVR Inox has always placed, and continues to place, the highest importance on corporate governance standards, ethical business practices and accountability across the organisation. The Company has established policies, processes and internal controls to guide its operations and stakeholder relationships.

 

PVR Inox has appropriate governance mechanisms to review and address matters that may warrant internal consideration. Any insinuation in the media report against its current stakeholders is baseless.

 

PVR Inox remains committed to conducting its business responsibly, in accordance with applicable laws and its established governance standards, while upholding the principles of integrity, transparency and accountability.

 

PVR Inox reported a consolidated net profit of ₹56.5 crore for the April-June quarter of FY27, against a loss of ₹54.5 crore in the corresponding period in the previous fiscal year. Revenue from operations rose 11.9 per cent year-on-year to ₹1,622.2 crore, while Ebitda increased 30.8 per cent to ₹528 crore.

 

The company's Ebitda margin expanded to 32.5 per cent during the quarter, supported by improved occupancy, a stronger film slate and higher contributions from advertising and food and beverage.

 

PVR Inox had net cash of ₹80.7 crore at the end of the quarter. Its board has also approved a ₹300-crore share buyback at ₹1,450 a share.

 

The promoters own about 27.5 per cent of the company, while the rest is held by foreign investors, domestic institutions and public shareholders.