- According to a CARE Ratings report, film exhibitors in India will lose at least ₹3,500 crore as cinema halls shutdown.
- Rating agency Acuite expects a precipitous drop of over 50% in multiplex footfalls in the next 2-3 months.
- The multiplexes chain are now considering approaching the government to seek a relief package, including deferment of certain taxes.
Cinema halls in India have had a bad start in 2020. First of all, it had few hits that enthused the public like Baaghi 3 or Angreji Medium. As
Coronavirus spreads, halls across many cities shut down as per government orders.
The management of theatres are now busy calculating the losses as 5,000 screens across the country are shut and even those that are open have nothing to bring people to as March and April releases like Rohit Shetty’s Sooryavanshi and Ranveer Singh’s 83 have been postponed indefinitely. The halls are losing ₹150 crore a week,
according to Shailesh Kapoor, CEO, Ormax Media.
The effect might be temporary says PVR Cinemas and Inox
PVR cinemas, which has 822 screens in 69 cities, says the effect may be temporary and they look forward to better times. INOX, which has 624 screens in 68 cities too is confident about their growth as the lockdown lifts.
But the investors do not share their confidence. PVR has witnessed a 43% decline in its decline in the last one month. Whereas the share price of INOX saw a 39% fall between February 18 and March 18.
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Several rating agencies are convinced that there would be a ripple effect. Moreso, because scientists are yet to determine whether warm weather can reduce the spread of coronavirus in India or not. Even in that case, a possible social isolation is advised till June.
Rating agency Acuite expects a precipitous drop of over 50% in multiplex footfalls in the next 2-3 months, particularly for those which are primarily located in retail malls at Tier I or Tier II cities.
"Typically, the holiday season of April-June is the peak time for big movie releases. However, the latter may get postponed due to the Covid-19 crisis," said Suman Chowdhury, president (ratings) at Acuite Ratings and Research.
This quarter is completely washed out says Carnival Cinemas
A few multiplex chains however acknowledged the situation like Carnival Cinemas, a multiplex chain in India with 470 screens across 120 cities.
“This quarter is completely washed out and shall be down at least 40-50% as compared to last year. One, because the movie line up was weak and then the Covid-19 impact in March. It is unfortunate that the business is affected so much, but human life is of most importance,” said Mohan Umrotkar, CEO Carnival Cinemas.
Considering the losses, multiplexes chains might move to the government to seek a relief package, including deferment of certain taxes. Industry insiders contend that restricted cash flows and mounting incremental costs such as rentals and operational expenses have left the sector in an untenable financial position.
According to a CARE Ratings report, film exhibitors in India will lose at least ₹3,500 crore every month. That is extra bad news for the industry which was already reeling from loss of revenue from CAA protests and riots in the last quarter.
See also:
The US box office suffered its worst weekend in more than 20 yearsCoronavirus hits box office — 83 release may be delayed and Sooryavanshi struggles