 "Why Bollywood is recession proof?")
What is common between India Inc and Bollywood? Both stand for one of India’s biggest industries. But what makes them different? The former is reeling under huger pressure owing to overall economic slowdown and the later is making most of the same situation, as it lives up to its reputation of being recession proof so far in 2013. The future looks even better with more star studded films ready to hit the market in the next six months from the stable of big production houses.
In 2013, four films have already crossed past the Rs 100 crore mark among which Chennai Express has created its own record to make it to the Rs 100 crore club within three days. Karan Johar led Dharma Production’s Yeh Jawani Hai Diwani was able to mop up to close to Rs 200 crore even when economists, experts had started indicating about the next Asian financial crisis set to hit India. Johar’s YJHD was made with a budget of about Rs 75 crore. That explains how good returns can be even during time when sentiments are not very positive. Mid size films, like Kai Po Che, Raanjhanaa have also done well in mopping up healthy returns.
What makes these films do well in such hard times? Growing number of multiplexes, digitisation of cinema prints, higher internet penetration in tier –II towns are fueling growth for the filmmakers of the Maximum City. Satellite rights too, add a healthy pie to the makers of such films. A superhit bollywood film makes anything between Rs 30-40 crore by selling its satellite rights.
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Ticket prices have gone up by about 15-20% in the recent past at multiplexes which has added to the equivalent amount of jump in the box office collection of these films backed by major production houses. The number of multiplex screens has gone up to above 1,400 now which is set to cross about 1500 this year.
Krunal Mehta, VP (branding & corporate communications) at Angel broking said the film industry has been giving one of the best possible returns. “Digitisation has helped in big way as number of screens has swelled into thousands for each film. Growing audience preference has created place for all sort of cinema which is good for everyone. In terms of records, this industry has been giving the best returns compared to many,” he added.
Earlier, film prints were used in theaters which had their own set of costs and limitations in terms of reaching to a larger set of audience. The industry today has shifted to digital prints and the major reason for the change is that each physical analogue print costs about Rs 50,000 while a digital print would cost only about Rs 7000-10000. Digital prints are unaffected by re-runs unlike physical analogue prints. Digital prints helps small films the most as it enables them to reach to a wider audience via satellite transmission across the country.
Owing to this, the share of digital prints has swelled to about 90% at present and physical prints have got a pie of about 10%, which is shrinking day by day. This has worked wonders for small budget films. Independent films such as Ship of Thesues, B A Pass and yet to be released Lunchbox are seen as profitable investments by studios, as small investments are reaping benefits riding on the success of digitisation. According to Ruchi Bhimani, executive producer of Ship of Thesues, the film has already garnered over Rs 2 crore so far. The satellite rights, which are yet to be sold, will add to the producers' kitty for sure.
SOT was one of the rare films which saw higher revenue in second week compared to its debut week. B A Pass, too, has managed a gross collection of over Rs 6 crore already, while it was made with a budget of about Rs 2 crore.
A top official of a major production house added that small films with credible content make them a healthy investment option as they connect with the global audience. Internet does the rest in order to promote such films. According to him, major bollywood films like Chennai Express, Bhaag Milkha Bhaag, have done exceptionally well in tier II towns.
With bigger star studded releases lined up in 2013 as such the Amir Khan starrer Dhoom 3, Hrithik Roshan’s Krrish3, Akshay Kumar’s Boss, it surely seems like there is no other business like the show business.