In the wake of malls and movie theatres across the country being asked to shut down due to the coronavirus pandemic, the film industry is staring at huge losses with several big-ticket releases being put on the backburner as well.
Tracking the impact of the shutdown on film exhibitors, CARE ratings has estimated that the temporary shutdown of film theatres across the country will to lead to a revenue loss of Rs 5,800 crore- Rs 7,800 crore per month for film exhibitors. Of this, Rs.3,500 - 4,500 will be for sale of movie tickets, including GST loss of Rs 800 - 1,000 crore.
Further, it says that loss of revenue on sale of food and beverages in theatres would amount to about Rs 1,500 crore – Rs 1,800 crore and an additional Rs 900 crore - Rs 1,000 crore will be lost on advertising income.
CARE ratings added that most film and TV show producers have decided to halt their shooting for a few weeks, till the virus subsides in the country. At the same time, release dates of most movies have been pushed to a later date. It says that a ripple effect has been created and this shall impact FY20’s last quarter revenues for film exhibitors.
According to Mohan Umrotkar, CEO of Carnival Cinemas, this quarter will be a complete wash-out for the company. Mohan estimates the business to be down by at least 40-50% compared to last year.
Carnival Cinemas has 425 screens across the country and reportedly registers a footfall of 50 million people every year.
“Definitely, COVID-19 has affected the business immensely. March has been impacted badly as compared to last year so does the last quarter. As per the government’s notification, all the cinemas are not functional till March 31 in most of the states and we are expecting that this situation will be under control soon and we will be up and running from April 1 onwards,” he told TNM.
Mohan adds that the movie line up was already weak, and COVID-19 has only made it worse.
“It is unfortunate that the business is affected so much, but human life is of utmost importance. Necessary precautions are a must in these times of crisis. We may not get the desired revenue in this quarter, but it will come in the subsequent months. As a business model, we have a fixed overhead so that’s a loss if the cinemas go vacant for a longer period of time,” he added.
However, once normalcy is restored and film schedule is back in place, Carnival expects Q1 in 2020-21 to yield at least 5-8% more revenue than last year same quarter as the current line-up of films looks very promising, including 83, Raadhe, Laxxmi Bomb, Bond movie and many more.
INOX, which has over 624 screens across 68 cities, is optimistic about its business despite the shutdown.
“There is no doubt that the current situation demands a lot of our attention and focus, and therefore we are channelising and committing our energies into ensuring a safe and healthy cinema viewing experience for our guests. But at the same time, we firmly believe that with all the precautions and medical knowhow, collectively, we will see through this impermanent phase,” it said in a statement.
Without disclosing the hit on their numbers, it added, "Our financials are a function of content. The better the content, the better will be the numbers. The quarter so far has seen the influence of good content, moderate content and health-related concerns. We completely respect and appreciate the health concerns, and hope that we are able to compensate their hunger for cinematic entertainment once the concerns wane off.”
Currently, INOX is offering a full refund to those who have booked tickets in advance and is encouraging employees who are no longer required to remain at the cinema halls to avail their unutilised leaves and stay at home.
PVR Cinemas in a statement said, “We believe that this is a temporary situation and remain buoyant about the film business in India, and our own growth prospects. We also look forward to continuing to serve our guests in the States of Kerala, Delhi and UT of Jammu and offering them a world class movie going experience 1st April 2020 onwards.”
“As far as those who are employed at movie halls are concerned, they will get paid leave. But we will not be able to stretch their paid leave beyond a point. So, the situation is a little tricky,” Nikhilesh said.
Rohini Silver Screens too is offering full refunds to those who had pre-booked tickets in advance.
Shutting down of movie theatres is also set to affect aggregators such as BookMyShow, which sells over 200 million tickets every year.
However, the company told TNM that business is not a pressing concern at the moment and that the health and safety of its customers is of paramount importance.
A BookMyShow spokesperson said, “We recognise the ongoing health concerns due to coronavirus and are committed to working with the regulatory authorities and the government on all precautionary health advisories issued across Indian states. BookMyShow fulfils the role of a ticketing aggregator for all movies listed on the platform and will follow all due procedures to ensure no inconvenience is caused to our valued consumers, in case of any cancellations or rescheduling of movie releases.”
BookMyShow said it will continue to closely monitor the situation and has requested all consumers to stay safe.
Meanwhile, Mohan said, “This is the first week of complete lockdown and we are not getting many queries from the patrons as the first priority is staying safe. Unfortunately, we are in this for a long haul. We need to prepare to pull together, help one another and preserve social cohesion while we use physical distancing to combat the virus.”