Friday, May 29, 2009

Bollywood losses pegged at Rs 350 crore (75 MILLION $)

As we go to press, news comes in from an official source in the United Producers and Distributors Forum that Amit Khanna, who has been mediating
Shah Rukh Khan, Vidhu Vinod Chopra, Mahesh Bhat in a discussion with the multiplex owners
between the producers and the multiplex lobby will host the final round of talks between the warring parties.

Mahesh Bhatt says, “The champagne will only be uncorked once the paperwork is done.’’ Aamir Khan and Shah Rukh Khan were involved in the final stage of talks, along with Yash Chopra, Ronnie Screwvala, Mukesh Bhatt and Vidhu Vinod Chopra.

Trade analyst Amod Mehra says, “The first quarter of 2009 was disastrous for the film industry. Both film corporations and mutliplexes lost money on movies like Chandni Chowk To China, Victory, Billu and Tasveer 8X10.’’ Dev D is the only one that sailed through with a decent profit margin.

Describing the second quarter of the year 2009 (April to June) as an even bleaker period for the entertainment companies, a trade source says, “This is the darkest period in Bollywood history, thanks to the multiplex-producer stand-off.’’ With revenues hitting an all-time low, it’s almost like writing off the quarter. For producers whose films are on hold, it’s money deferred, but it is a disastrous quarter for multiplex players as well.

“The stand-off will show in every company’s quarterly result. But at the same time, we need to take into account that this is a major crisis. Everyone kept ignoring it, but at some point it needed to be addressed,’’ says Priti Shahni, from one of the leading film corporations.

Though markets have jumped considerably, the share prices of multiplex companies have underperformed mainly due to the stand-off.
Even assuming the strike is called off on May 29, the collective losses between multiplexes, producers and allied businesses is being pegged at Rs 350 crore by industry estimates, with each day of strike costing around Rs 5-7 crore.

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