Third Eye Cinema Fund, the Sebi- approved pure-play film investment fund in the country, will launch this month a new fund with corpus of Rs 250 crore to focus on low-budget films.
The movie industry is worth about Rs 12,000 crore, with 13,000 screens across the country.
"We will be launching our Rs 200-crore fund with a green-shoe option of Rs 50 crore in the late April. Our fund is the Sebi-approved alternate investment fund aimed only at movies," the fund's chief executive Kewal Handa told PTI.
The Sebi approval came in last November, he added.
Explaining the reasons for getting into this risky field, chief operating officer Shariq Patel said films gave the highest return last year at 35 per cent, while gold gave a negative return of 2 per cent and Sensex gave under 5 per cent.
"Given the growth of the film industry, many want to invest, but have no clue how to go about it. With the digitisation of screens and advent of a corporate structure in major studios/production houses, many of the ills of the industry are being rectified," Handa said.
On their fund-raising strategy, Handa, who headed Pfizer India as MD from 2005-12, said they will be promising over 25 per cent annual return to investors and the focus will only be low-budget films -- Rs 5-20-crore bracket -- as they have lower chances of getting bombed.
Net asset value would be published every six months to show the health of the fund, among other things, Handa added.
"Also a key focus will be regional films like Malayalam, Kannada, Bengali, Marathi and Bhojpuri among others, which make highly successful flicks at low cost. Of course we cannot afford to fund the Khan or Rajanikanth movies as they run into over Rs 100 crore. So in general, mainline Hindi, Tamil and Telugu movies are not our target," he said.
Patel said, "The fund will be looking at investing in films such that the money can keep circulating at a brisk pace. We understand the risk in films and, therefore, will invest in different films in different ways. Our interest will be in content-driven films with budgets of Rs 5-20 crore.
