Low-budget films are back

FILMS: Financial crisis makes producers change track

With the whole country now firmly in the grips of an unprecedented shortage of financial liquidity, the age of low-budget films is all set for a comeback. These films cost Rs 6-7 crore to make, have good actors (not stars) in their cast and are wrapped up in double quick time.

Later this week will see the release of Oye Lucky, Lucky Oye — a film by Dibakar Banerji who made the well-acclaimed Khosla Ka Ghosla some time back. In the first week of December will come no less than seven such small and medium budget films like Dil Kabaddi, Horn Ok Pleasss, Khallballi and Meerabai Not Out. Then another 6-7 such releases are planned between end-December till mid-January.

Film industry experts say these are all low-risk ventures and breakeven will not be difficult for them to achieve. “Each of these films has not been made for more than Rs 3-4 crore. If they manage to see through the first week, they will make some money,” says a Mumbai-based trade pundit.

Call it coincidence, but there are only three big-budget releases left in the pipeline — Aamir Khan’s Ghajini, Shahrukh Khan’s Rab Ne Bana Di Jodi and Akshay Kumar’s Jumbo – which will all hit the screens next month. Optimistic trade experts expect Rs 200 crore-plus of business from these three flicks.

For producers of low-budget films, there is the recent success of Welcome to Sajjanpur, a low-cost Shyam Benegal film produced by UTV Motion Pictures, to take heart from. The film with an unassuming cast of actors and a simple story line did well at a time big-budget films like Love Story 2050, Drona, Karzzz and Kidnap bombed on the box office. Only three high-cost films — Golmaal Returns, Dostana and Fashion — have been able to rake in some cash in recent times.

Producers are turning to such films because it is getting more and more difficult to produce big-budget films. It is learnt that almost Rs 200 crore is stuck in a score of large banner films.

“Organised sources of film financing like banks are not interested in lending to any Bollywood film producer. We are going back to the days of barter deals and distributor-led financing options. Therefore, the days of producing the small-budget films are back,” says veteran film producer Bobby Bedi who has produced films like Bandit Queen and Mangal Pandey.

Music rights are no longer fetching big bucks and distributors too are unwilling to bet big. Moreover, thanks to the financial crunch, there are no takers for the satellite and television rights for most recent releases. With companies pruning their advertising budgets, broadcasters have begun to shy away from the satellite rights of big ticket films. “Some channels in the recent past have spent Rs 15-20 crore to acquire films that do not even run for three straight weeks,” says a senior executive of a leading entertainment channel.

“Producing small-budget films makes a lot of sense today as you can have a better control on the finances, the satellite rights among others. Also, such films tend to get better returns in multiplexes,” says Bedi.

Not all are convinced that there is no life left in big budget films. “Bad times are here for real for Bollywood. But the three-big releases in December will do well to lift the mood a bit. Once these flicks do well, as they are expected to, we will have a positive rub-off on the entire industry,” says Percept Holdings Joint Managing Director Shailendra Singh whose firm Percept Picture Company is distributing Jumbo.

Singh says that if at all there is an adverse impact on the overall films business, it will be evident in 2010 and not next year. “A bulk of the films planned by various studios here are on track. So we can expect to see them in 2009. Of course, the new projects will get impacted due to the slowdown,” says Singh.

“Of course, the slowdown is affecting every business. But players like us will see-through such times because of sound planning and execution of film projects,” adds UTV Motion Pictures CEO Siddharth Roy Kapur.

Concurs Studio 18 CEO Sandeep Bhargava: “We are distributing Ghajini. We are spending a good amount of money on its promotions. The simple point is that there will be spending even at such times of slowdown if the prospects for healthy returns are brighter.”