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Connplex Cinemas FY26: Scaling an Asset-Light Cinema Network, With Margins Under Pressure

Connplex Cinemas closed FY26 with a sharp jump in scale and headline growth, but also with a clear reminder that rapid expansion has a cost. For the year ended March 31, 2026, the company reported revenue from operations of ₹14,752.06 lakhs (₹147.52 crore), up 54.29 percent year on year. EBITDA rose 33.11 percent to ₹3,492.87 lakhs (₹34.93 crore), and profit after tax increased 37.44 percent to ₹2,607.92 lakhs (₹26.08 crore).

Operationally, the network expanded to 41 operational cinemas with 113 screens and 9,797 seats across 9 states. Footfalls grew strongly, with FY26 admits at 27.63 lakh, up 63 percent versus FY25. Average Ticket Price (ATP) improved to ₹264 from ₹250, while Spend per Head (SPH) rose to ₹95 from ₹83, pointing to stronger food and beverage contribution.

While growth remained strong in H2 as well, the margin trend drew investor attention. H2 FY26 revenue from operations was ₹8,346.07 lakhs (₹83.46 crore), up 51.97 percent, but EBITDA margin in the company’s financial highlights table declined year on year. Management attributed this primarily to higher operational and expansion-related costs, including increased headcount and stepped-up advertising and marketing spends after the IPO.

A business mix built around franchise expansion

Connplex positions itself as an asset-light cinema platform, scaling through FOFO (Franchise-Owned, Franchise-Operated) and FOCO (Franchise-Owned, Company-Operated) models. The investor presentation discloses multiple revenue streams for FY26, with the two largest being franchise fees/cinema making and movie exhibition.

Management highlighted that the revenue base is diversified across cinema development (described in the concall as an EPC or cinema making vertical), ticket sales, F&B, advertising, convenience fees, private events, and VPF share. In the earnings call, management also described an additional lease-sublease model, where the company leases cinema space from developers and subleases it to franchise partners to increase control over real estate.

A recurring theme in the Q&A was how screen additions translate into reported cinema making revenue. Management clarified that cinema making revenue is recognized on completion because projects are treated as turnkey. Costs incurred before completion are carried as work-in-progress, and operational opening can lag completion due to licensing timelines or franchise partner preferences. This timing mismatch, along with screens completed earlier but operationalized later due to licensing delays, was repeatedly cited as the reason screen additions and cinema making revenue do not map linearly in a given half year.

FY26 revenue mix disclosed in the investor presentation

Note: Amounts are converted from ₹ lakhs disclosed in the presentation and management commentary. The mix above is the company’s disclosed revenue streams and may not reconcile mechanically to reported revenue from operations due to classification differences discussed on the concall.

FY26 financial performance: growth with a margin trade-off

The company delivered strong year-on-year growth across revenue and profitability. Over the last three years, the investor presentation highlights steep expansion, with FY23 revenues of ₹2,536.91 lakhs rising to ₹14,752.06 lakhs in FY26. PAT grew from ₹164.84 lakhs in FY23 to ₹2,607.92 lakhs in FY26.

But FY26 also showed margin compression compared to FY25. In the financial highlights table, FY26 EBITDA margin (excluding other income) was 23.68 percent, down from 27.45 percent in FY25. PAT margin was 17.68 percent versus 19.85 percent.

Management’s explanation was consistent across multiple questions.

• Headcount increased from 96 employees as of March 31, 2025 to 143 as of March 31, 2026.
• Employee benefit expenses in the financial statements rose to ₹995.75 lakhs.
• Other expenses increased to ₹1,778.68 lakhs.
• On the concall, management stated that additional advertising and marketing investments were made to support franchise partner onboarding and brand positioning.

The tone of management commentary was that these costs were deliberate investments to support the next phase of growth. They also indicated intent to optimize certain costs going forward.

Core financial summary from the investor presentation

Operating engine: screens, formats, and tiered markets

Connplex’s expansion strategy is built on smaller-screen formats and an emphasis on tier 2 and tier 3 markets, while still selectively pursuing tier 1 locations when economics are attractive. The presentation describes three cinema formats.

• Express Model, described as compact and efficient, with 55 to 120 seats per auditorium (43 screens in FY26).
• Signature Model, described as refined and versatile, with 50 to 100 seats per auditorium (38 screens).
• Luxuriance Model, described as opulent and exclusive, with 30 to 90 seats per auditorium (32 screens).

From an operational KPI standpoint, the number of screens grew from 24 in FY23 to 113 in FY26, which the company cites as a 3-year CAGR of 68 percent.

The company’s regional footprint at FY26 end was disclosed as 41 cinemas and 113 screens, split as North 2 cinemas/4 screens, East 17 cinemas/44 screens, West 19 cinemas/57 screens, and South 3 cinemas/8 screens.

In the concall, management linked the modest ATP increase to timing. Some higher-end Luxuriance screens opened late in the period, so their contribution was visible in operating metrics but not fully reflected in a full-period revenue run-rate.

Guidance and outlook: an aggressive pipeline with execution dependencies

Management’s forward commentary was focused more on operational scaling than on detailed financial targets. The most material disclosure was the upcoming screen pipeline.

• The investor presentation states 230+ new upcoming screens in FY27 and FY28.
• In Q&A, management indicated an expectation to add around 80-85 screens in FY27 and potentially exceed 100.
• For FY28, management mentioned a target of around 25 percent growth in screens.

Management also described expansion into multiple states including Jammu and Kashmir, Punjab, Nagaland, Telangana, and Chhattisgarh, alongside continued scale-up in key states where it already operates.

At the same time, the concall included a practical caveat. Management said real estate project delays can push timelines, because cinema work starts only after the developer completes required civil work and structural modifications. Licensing can also delay operational start even after completion.

Balance sheet notes: IPO proceeds parked as current investments

The balance sheet in the investor presentation shows a sharp increase in current investments to ₹6,618.33 lakhs from ₹889.67 lakhs. Management clarified this primarily represents IPO proceeds parked in short-term deposits because the funds are expected to be utilized within a year.

Management also stated that total debt as on FY26 is almost nil and that the company has a net cash position of ₹7,615 lakhs as of March 2026.

Key takeaways

Connplex’s FY26 narrative is centered on rapid scale-up through a franchise-led model, with growth visible in both network size and footfall metrics. Revenue and PAT growth remained strong, but margins moved down due to higher employee and marketing costs tied to expansion.

The next phase depends on whether the company can convert its stated 230+ screen pipeline into operational capacity without slippage from real estate and licensing dependencies, and whether operating leverage can offset the higher cost base built in FY26.