Multiplexes rake in the rupees in Bollywood-mad India
By Nandita Bose and Abhishek Vishnoi
MUMBAI (Reuters) - For a country that produces twice as many movies a year as Hollywood, India has a problem that's making cinema theatre operators beam: a shortage of modern multi-screen cinemas and plenty of increasingly affluent film fans.
Multiplex operators like PVR Ltd, Inox Leisure, Reliance Mediaworks and Mexican chain Cinepolis are scrambling to set up theatres targeting the rapidly growing number of middle-class Indians willing to pay to watch Bollywood movies in more comfortable surroundings.
These plush theatres, often in big city shopping malls, are a far cry from the single-screen cinemas most Indians still frequent and which range from huge, purpose-built halls to sheds where the deluxe seats are wooden benches.
The potential is huge, provided operators can find the right location in a country where prime urban real estate is costly and in short supply.
Multiplexes account for just 8 percent of India's 12,000 screens but rake in a third of total box office receipts, according to the Single Screen Association of India and a report by consultants KPMG and the Federation of Indian Chambers of Commerce and Industry (FICCI).
Averaging 160 rupees ($2.60) each, tickets at Indian multiplexes cost almost three times more than a ticket at single-screen cinemas, the KPMG-FICCI report said. At the Inox multiplex in a prime Mumbai area, tickets for a recent showing of blockbuster "Krrish 3" sold for as much as 380 rupees ($6.10) each.
"Indians love their movies, their Bollywood stars and the middle class is increasingly ready to spend on a better movie-watching experience," said Pramod Arora, president of India's biggest movie theatre operator PVR, which expects revenue growth of 25 percent a year for the next three years.
By comparison, KPMG forecasts overall film industry revenues to grow 10.8 percent a year through to 2017. Continued...