Bollywood reels under Rs300 cr blow

MUMBAI: It’s not just the aam aadmi who is feeling the pinch of inflation. It has claimed a much more glamorous casualty — Bollywood.

With just two hits — Race and Jannat — and two average grossers Jodhaa Akbar and Sarkar Raj in the first six months of 2008, the industry’s losses have mounted to a nerve-rattling Rs300 crore.

While some are citing run of the mill scripts and lack of publicity as reasons for the lacklustre report card, others say runaway inflation is the villain.

With a ticket at the multiplex costing between Rs150 and upwards, watching a film could cost a family of four Rs600 and if you thrown in the popcorn and samosas, it would burn a bigger hole in the pocket.

“Everyone is busy blaming bad and predictable scripts and a slack in promos as the reason for such a poor half-yearly report, but one needs to dig deeper for the real reason. It is unimaginable that the loss ratio can be so high only due to bad films,” says veteran film trade analyst Amod Mehra.

“People are simply not going to the theatres and badly made films or lack of promotion are not the sole causes. Look at Jaane Tu … Ya Jaane Na, Aamir Khan has gone all out with the promotions but the advance bookings are simply not happening. People don’t seem to be interested in shelling out money for films and here is where inflation is making an impact,” adds Mehra.

Among those which fell like nine pins in the first six months were Big B films Bhootnath and Sarkar Raj, the multi-starrer mega-budget offerings from the Yash Raj stable — Tashan and Thoda Pyaar Thoda Magic, and Ajay Devgan-Kajol starrer U, Me Aur Hum. Rakesh Roshan’s Krazzy 4 bombed too which failed to pull in the crowds despite the combined presence of Shah Rukh Khan and Hrithik Roshan.

“It is a worrying scenario for the industry. People are edgy about spending money because they are no longer sure if a film with stars and even decent content will work or will flop. Inflation is certainly playing a big role,” says Mehra.

But stock market analysts feel producers will continue to pump in the money.
Says media analyst Girish Swar of brokerage firm Anand Rathi Securities, “Most of the big players are well funded for the next one year and cash flow should not be a problem. UTV is expected to get about $8mn net cash from The Happening of which it is a co-producer. Walt Disney is also pumping in a lot of money into a Yash Raj venture.”

According to Swar Balaji Telefilms has cash reserves of Rs50 crore and Eros and Reliance have deep pockets too.  

Pritish Nandy Communications is co-producing around four films with Sony Pictures. “Overall, I don’t see any cash issues in Bollywood,” says an optimistic Swar.

 Analyst Vikash Mantri of ICICI Securities shares a similar sentiment: “They (the producers) are all sitting on enough money that has been raised from the markets and it doesn’t look like there will be any cash flow problems. Raising money is definitely difficult now and valuations have begun to slide but there is enough cash going around right now.

“The trend is that Bollywood performs better in the second half of the year and business should catch up now that a series of releases are lined up. I don’t think consumers are going to stop going to the cinemas because of any inflationary pressures. IPL may have resulted in lower revenues for multiplexes but things are on the mend now,” adds Mantri.

Bollywood researcher Derek Bose has another take on the issue. He feels increased exposure to international films has started showing up Bollywood’s soft spots.
”With the same gags and flippant plot lines, the young, upwardly mobile multiplex audience is bound to be put off sooner than later. People are looking for variety and have become demanding after being so much exposed to global trends,” says Bose.

(With inputs from Tanvi Shukla)