Bollywood stares at dry summer
With large parts of the world in lockdown and the global economy sinking on account of the coronavirus disease (Covid-19) outbreak, India’s Hindi entertainment industry — one of the biggest in the world — is staring at a likely revenue loss of upwards of ~1,300 crore, based on predicted domestic net collections of 12 big-ticket films that either released in March or were slated to release in April and May.
To be sure, these figures are average estimates provided by several industry trade analysts HT spoke to, and offer only an indication of how much money a film could have earned, based on factors such as the number of shows and screens, the actors starring in the film, the previous work of the directors, the release period, and even consumer sentiment.
Net collection is the total sum of ticket value sold across the counter in single screen and multiplex theatres within the country after tax deduction. The money earned by a film through its overseas release as well as by selling television and music rights adds to its overall collections.
“In the last two years, the industry made around ~850-900 crore in net collections in the April-June quarter. We’re definitely losing that amount,” trade analyst Atul Mohan said.
Several of the upcoming films have also been forced to hold back releases in international markets as the Covid-19 pandemic has led to theatres closing down. Markets such as the UAE, the UK, Australia, and Fiji account for approximately 30% to 40% of a film’s overall box office collection.
To be sure, once the pandemic runs its course, these movies could release and technically recover costs. However, whether they will be able to do so will depend on several factors, including the state of the economy, the number of Fridays left in the year, and importantly, the willingness of movie-goers to spend on tickets.
To understand the coronavirus pandemic’s impact on Bollywood, let’s take a look at the weekend everyone in the film industry looks forward to on a pandemic-free year: the Eid weekend.
May 22 (a Friday) was going to be the big clash between Salman Khan’s Radhe and Akshay Kumar’s Laxxmi Bomb. While the former likely cost ~125 crore to produce, the latter was made at an estimated production cost of ~90 crore. In 2019, the Eid weekend film release, Bharat, collected ~150.1 crore (this figure is based on collections from Wednesday to Sunday). In 2018, Race 3, collected ~106.47 crore (Friday to Sunday). So this year, the weekend collection of both films was pegged at a conservative estimate of ~175 crore. Both films had some shooting and dubbing work left. Now, there’s little hope it will be completed or, for that matter, released.
“Even if say that the total business for each of the films (Radhe and Laxxmi Bomb) is ~200 crore, cumulatively that would mean ~400 crore, and this is when the business is going right. In the Eid weekend alone, the films could have made ~175-200 crore. That’s what we are looking to lose on that particular weekend,” said trade analyst Taran Adarsh.
Actor Tusshar Kapoor, co-producer of Laxxmi Bomb, said, “Given the current situation, no one can say anything till the lockdown is lifted. It’s too early to comment.”
Ides of March
March’s big release was supposed to be Sooryavanshi — an action film from Rohit Shetty’s cop franchise starring Akshay Kumar and Katrina Kaif — made with a sizeable budget of ~125 crore. The makers were hoping to cash in on the Gudi Padwa holiday (new year for Marathi and Konkani community), by releasing their film on March 25, a Wednesday. That did not happen.
Kabir Khan’s ’83, starring Ranveer Singh, was made in an estimated budget of ~100-115 crore, and was slated for an April 10 release. It has also been delayed. So have Varun Dhawan and Sara Ali Khan starrer Coolie No 1, and Amitabh Bachchan and Ayushmann Khurrana-starrer Gulabo Sitabo. Industry analysts believe that both, Sooryavanshi and ’83 could have made upto ~250 crore each in box office collections.
The first signs of trouble were seen on February 28, on the day Taapsee Pannu-starrer Thappad released. By this date, more than 82,000 people around the world were infected, and over 2,800 had died. Several European countries had also started reporting the outbreak.
Tiger Shroff’s high-octance action film Baaghi 3 didn’t attract much footfall in theatres across the country after its release on March 6. Angrezi Medium, which was to be actor Irrfan’s comeback film after his cancer battle, released on March 13 — within a few hours of its release, cinema halls were formally shut down across the country.
According to Mohan, the industry expected to make at least ~500 crore in net collections in March based only on the three big releases: Baaghi, Sooryavanshi and Angrezi Medium. Baaghi 3, made on a budget of ~70 crore, collected ~92 crore; Angrezi Medium, made on an estimated budget of ~35 crore, managed to collect only ~8.5 crore till March 13.
On March 15, a decision to stop all shooting in all formats — television, web or film — till March 31 was taken in a joint meeting held between various industry bodies, including the Indian Motion Pictures Producers’ Association, Indian Film and Television Directors’ Association, and Indian Film and TV Producers Council. Since then, the number of Covid-19 cases have only risen, and the country has gone into a 21-day national lockdown that will end only on April 15. This means that the moratorium to shoot stands extended.
Shibasish Sarkar, group chief executive officer — content, digital and gaming at Reliance Entertainment said it will take time for things to return to normal. “I don’t foresee any films releasing before three to six months. This is not a two or three-week issue. There’s the health and medical aspect, but the other is about the impact on people’s mind for them to go to a cinema hall. So, even if the medical crisis ends in 3 months, I don’t expect people to immediately walk into theatres. That’s the [time period] which we are preparing for,” he said. Reliance Entertainment has produced Sooryavanshi, ’83 and The Girl on the Train.
“We obviously have lost the summer holidays, which is an important period for movies, not just in India but also globally,” film distributor Akshaye Rathi said. “These big films have a significant revenue from the overseas markets as well, and considering how the situation is, I don’t see them coming out till the time global markets really opens up because makers won’t compromise on that front.”
Speculation is also rife about whether at all Karan Johar’s Dharma Production will make either of its two most ambitious announced projects, Takht, a high budget period film, or contemporary comedy, Dostana 2.
“When this outbreak started, we predicted losses of approx Rs 600 to 900 crore for the industry, but now, it’s uncertain. If you notice, the statements issued by production houses or filmmakers only say they’re postponing the release, but there’s no date. Because nobody can say for sure. It could be June, July or August,” Adarsh said.
Even Hollywood film releases will affect The new James Bond film, No Time to Die, is no longer seeing an April release, and Wonder Woman, a DC super-hero production, has been pushed to August. “Last year, Hollywood films which were released in India made approx Rs 1,400 crore, in 2018, the amount was about Rs 1,000 crore and in 2017, it was some Rs 50 crore. This year, we haven’t had any major Hollywood release in the first quarter, and now the ones coming out have been pushed,” Mohan said.
It is “inappropriate to put a number in terms of quantum of loss” Rathi said, as one could not be sure of the “longevity of this (pandemic) or its geographical impact”. “It’s not absolute loss but delayed profits,” he said.
That’s an optimistic way of looking at it, but it doesn’t account for consumer mood at the end of this outbreak — in what state will the economy be (Moody’s has predicted a slashed growth forecast of 2.5% for the country), and would that translate to consumers spending money on film tickets in multiplexes and single theatres? When would movie-goers feel safe to go into such public spaces again?
Furthermore, considering half the year is already exhausted, leaving producers with limited Fridays, analysts expect multiple clashes at the box office. Adarsh foresees a “complete chaotic scenario” when theatres reopen. Even Rathi admits that many big films releasing in a short span of time would “likely eat into each other’s business”.
“Multiple clashes will result in division of audience footfalls, theaters, shows and eventually, collections. So, 2020 may definitely not be even half as good as 2018-2019,” said Sumit Kadel, industry analyst.
With such uncertainty, it would make sense for films to directly make their way to the web rather than have a theatrical release. USA’s Universal Pictures on March 17, announced that it would bring its fresh theatrical releases to cable television and other video on demand platforms. But such business decisions are unlikely to happen any time soon here given the national lockdown, trade analyst Atul Mohan said.