This move will help the company to increase contribution from the tier 3 cities.
PVR is looking to foray into small towns and cities through a sub-brand. In this regard, the multiplex major has been experimenting with a low-cost format, 'PVR Talkies', over the past 3 years.
The majority of PVR's revenue comes from tier 1 cities, with tier 2 cities contributing the balance. This move will help the company to increase contribution from the tier 3 cities.
The cost for setting up a Gold class theatre screen is about Rs 5.5 crore while Rs 3 crore for a regular PVR outlet. Compared with this, setting up a screen under PVR Talkies only costs Rs 1.75 crore-Rs 2 crore.
Gautam Dutta, CEO of PVR, said, "We are contemplating the introduction of a sub-brand in tier 2 and 3 markets. Maybe a decision on this could come closer to March this year."
Currently, 10% of the company's top-line comes from premium services such as Gold Class, IMAX, 4DX and PXI.
PVR is further planning to invest up to Rs 600 crore in the coming two years to add nearly 100 screens in a year. It is also looking to take over single-screens and rebrand them as 'PVR'.