With PVR productions like Aisha and Lamha failing at the box office, and acquired films like Ashutosh Gowarikar’s Khelein Hum Jee Jaan Se garnering dismal collections, the company has decided to park its money in co-productions this year. Starting with Shanghai, a co-production with Dibakar Banerjee, PVR has signed similar revenue-sharing deals for Teen They Bhai, a Rakeysh Omprakash Mehra film and an Anil Kapoor and Neeraj Pandey film for 2011.
PVR’s movie business was expecting cash benefits on the back of such big releases as Action Replay (a PVR co-production) and Khelein Hum Jee Jaan Se (PVR owned the distribution rights), but the films failed to generate much business. Kamal Gianchandani, president, PVR Pictures, says: “We could have spent money wisely in producing the films that we made in 2010 and some of the prices that we paid for acquiring films could have been curtailed, but we did make money of each film.” Aisha, according to PVR, was a profitable venture, with PVR collecting around Rs 25 crore of net proceeds. PVR Pictures recently announced that it will back Dibakar Banerjee’s political thriller Shanghai. Looking at Banerjee’s track record, PVR has reportedly extended the budget to Rs 15 crore for the film starring Abhay Deol and Emraan Hashmi.
In the second quarter of 2011, the filmed entertainment business of PVR garnered revenues worth Rs 29 crore. Gianchandani says, “We should be able to scale revenues to Rs 100 crore in 2011.” For the financial year 2012, PVR has planned a production slate of five movies but asserts that it will stay away from doing big-budget films in 2011. “All films that we will produce in 2011 will be well within the Rs 30-50 crore budget. There’s no point in spending multi-crore on the scripts that don’t need capital investment,” he reasons.
PVR Ltd has 60 per cent shareholding in the subsidiary PVR Pictures, with the balance 40 per cent stake held by JP Morgan Mauritius Holding Ltd and ICICI Venture in equal proportion. Gianchandani insists that the company is not looking to raise any capital in the immediate future. “We don’t have plans for an IPO this year because we are a cash-rich company, but we do have plans to launch our digital initiatives unit that will explore the digital rights of the productions.” He refuses to give details on the digital initiative but adds, “We will look at internet video streams as producing mobile content is another business model altogether.”
International film distribution will be another focus area for PVR Films. “We frequent various international festivals and have selected titles that will make the best economic sense to be released in India under the PVR Pictures banner,” says Gianchandani. PVR’s recent releases like the Twilight series and Step Up were runaway hits and Gianchandani adds that in 2011 movie-goers can expect more than 15 Hollywood flicks from the banner.
As per Ficci-KPMG estimates, the film industry was projected to grow at a CAGR of nine per cent and touch Rs 13,700 crore by 2014 from Rs 890 crore in 2009.
