 "<i>Happy New Year</i> earnings drop but enters Rs 100-cr club")
Its collections dwindled on Saturday (Rs 35 crore) and Sunday (Rs 28.8 crore), culminating to a total weekend domestic collection of Rs 108.9 crore. After the initial occupancy in theatres of 85 to 90 per cent over the weekend, early estimates on Monday suggested an occupancy of close to 40 per cent across India.
While the movie has been breaking records for the highest opening day and opening weekend collections, analysts believe that the drop in revenues over the weekend is not a healthy sign. Experts peg the first week collections in the domestic market to touch Rs 150 crore, while the life-time could be just in excess of Rs 200 crore.
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This means that the film's distribution partner - Yash Raj Films - will be banking on the overseas collections in order to recover its investment in the movie. According to industry sources, Red Chillies Entertainment, the producer of Happy New Year, struck a minimum guarantee deal with YRF for the distribution of the movie. In this model, the distributor pays the producer a pre-decided amount (in this case, Rs 125 crore), irrespective of the collections post release. Once this pre-decided figure is paid, the two parties share the box office revenues on a percentage sharing basis, which differs from film to film.
In other words, till the movie makes Rs 125 crore after entertainment tax and exhibitor share, YRF can not book any profit.
Thus, in order to break even, the distribution partner needs Happy New Year to make about Rs 250 crore at the box office. Given the way the collections and occupancy has fallen after the initial euphoria around the movie, YRF will now be praying the movie makes at least Rs 50 crore in the international circuit, considering the movie's domestic lifetime collection is expected to hover around the Rs 200-crore mark. Early estimates by trade pundits peg the weekend collection of the movie in the overseas market at about Rs 30 crore.
"The movie opened to mixed reviews, but by and large, it has not lived up to the expectations of the people. Social media has mixed reviews of the movie while critics have not rated it too high either. The main complaint from the movie is its length and dodgy screenplay. On Monday, cinema halls saw drastic drop in occupancy and this trend will continue as the week wears on. At most, the movie will make Rs 150 crore in week one," says Shaaminder Malik, independent exhibitor and trade analyst for north India.
However, Red Chillies has hedged itself against box office volatility by selling the distribution rights to YRF, satellite rights to ZEE Entertainment Enterprises Limited for an estimated Rs 55 to 60 crore and music rights to T-series for another Rs 6 crore. While the total cost of production was close to Rs 150 crore (Rs 120 crore for production and another Rs 30 crore for promotion and marketing), the production is sitting pretty with revenues from Happy New Year in the range of Rs 190 crore. This does not include the revenue share after minimum guarantee recovery.
So, Red Chillies has already booked a profit of Rs 40 crore on the movie, and is looking at increasing this by the time Happy New Year is done with its theatrical life-time in India and overseas.
The film received the biggest release ever in Bollywood at an estimated 4,800-5,000 screens in India and 900-1,000 screens abroad.
Directed by Farah Khan, the movie stars Shah Rukh Khan, Deepika Padukone, Abhishek Bachchan, Boman Irani, Sonu Sood and debutante Vivaan Shah.