Film Industry Needs a Couple of Hits to Come Out Of Shock: PVR CEO Gautam Dutta
Film Industry Needs a Couple of Hits to Come Out Of Shock: PVR CEO Gautam Dutta
 16 August 2017

The movie business has been weathering storms in recent months in the form of demonetisation and the Goods and Services Tax (GST), but leading cinema-exhibition company PVR has its eyes firmly set on attracting more audiences.

The company recently launched 10 more screens in Pune as part of its expansion plans, taking its screen count in Maharashtra to 160 screens across 38 properties. After Pune, cities such as Mysore, Hyderabad, Chennai and Ghaziabad will see the launch of around two to three screens each in the next few months.

In all, the company currently has nearly 600 screens in India and adds about 70-75 screens every year, Chief Executive Officer Gautam Dutta told Moneycontrol. The capital expenditure for each new screen is around Rs 2.5 crore on average.

Cinema's classification in the highest GST tax slab of 28 percent, however, is being considered by industry experts to be a stumbling block. Ajay Bijli, PVR's Chairman and Managing Director, has previously said that had it not been for the high GST rate, the company would have been scaling up opportunities for the domestic box office.

Dutta said that while no negative effects of GST have been felt so far, he expects the government to take the entertainment business seriously.

"Films are not a sin product. In fact they are staple entertainment for Indians," he said.

PVR alone caters to around 80 million of these cinemagoers, which is around a fifth of the market.

Another hiccup in the first half of 2017 was a series of slow performers at the box office. Apart from Baahubali: The Conclusion, there has not been a single box office hit.

“Tubelight was a big dampener and if the Salman Khan-starrer had done half as well as expected, the numbers would have been a lot different,” said Dutta. “The industry needs one or two big hits to come out of this shock.”

While the Baahubali sequel picked up Rs 1,590 crore in all formats, director Kabir Khan's Tubelight flickered at the box office with Rs 156 crore collections in India and Rs 207 crore worldwide.

He also pointed out other factors that led to a dull period for the industry such as demonetisation, which triggered a fall in advertising revenues. However, Dutta believes that this lull is short-lived and business will be on the road to recovery in the next quarter.

Analysts have also attributed same-day releases of high-profile releases for Bollywood's recent lull. But according to Duttam if the product (film) is good it will work. “If it was about losing business why would Shah Rukh Khan release his movie with another film?”

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