Solo Brathuke So Better, the Telugu film which released during Christmas, had a fairly successful opening week. The film, starring Sai Dharam Tej and Nabha Natesh in the lead roles, has earned more than Rs 8 crore in the last week, says Kumar, a film producer and business economist consultant in Hyderabad.
Although the film has done well and new movies have lined up for release during the second week of January, during the Ugadhi festival, a sizeable number of single screen theatre owners in Hyderabad say that they are likely to shut down permanently. Most have been staring at mounting losses post their reopening after the lockdown due to the Covid-19 pandemic.
Theatre owners say that these new releases are not enough to make up for the loss they have accrued these last few years. Badam Venkat Krishna, managing director of Sree Mayuri 70MM cinema hall in Hyderabad, says he might be closing down his theatre due to lack of good content and financial stability.
Along with Sree Mayuri, other iconic cinema halls such as Galaxy 70MM, Amba in Mehadipatnam, Shanthi in Narayanaguda, and Venkatadri in Dilsukhnagar have also closed their shutters.
“I haven’t opened my theatre since March 15. The government asked us to open the halls but there hasn’t been particularly great content since then. It’s not only because of the Covid-19 pandemic, the industry was already suffering from before,” he says.
Owners say that the state government doesn’t allow theatre owners to collect parking charges, imposes electricity charges even when they are non-functional and levies taxes on them, making the venture highly unprofitable.
The government has been imposing a Minimum Demand Charge, which is the amount of money that is deducted as electricity charges when the commercial or industrial building is not in use, says Venkat Krishna.
Before the recent election, the chief minister had announced that the Minimum Demand Charge would be abolished.
“For the past nine months, every theatre owner has had to pay a minimum of Rs 20,000 as Minimum Demand Charge. If this had been waived off, the losses wouldn’t be so huge,” says Venkat Krishna.
Besides the Minimum Demand Charge, the ticket pricing system has also been a hassle for years, says Venkat Krishna.
“In single-screen theatres, ticket price begin at Rs 30. It is mandatory that 15% of the capacity has to be in this price bracket. However, this rule only applies to single-screens and not to multiplexes. The government will not provide us licenses to operate otherwise. We end up spending a sizeable amount on air-conditioning the theatre for all. Why does the rule only apply here?” he says.
He adds that if the standard municipal tax could be waived off for the period of the pandemic, it would be helpful.
Parking charge is another issue he feels that needs to be discussed. The government had made parking free at the theatre premises since 2018.
Balagovind Raj, secretary of the Exhibitors Association in Hyderabad and owner of Sudarshan 35MM and Devi 70MM theatres, says, “The only two surviving forms of revenue are parking and canteen. But the government made the parking charge free from 2018, so since then we’ve been limping. So, they now need to reinstate the immense losses that have been incurred.”
According to Balagovind, Shanthi 70 MM, the renowned theatre in Hyderabad, is also closing down due to loss of revenue.
Anupam Reddy, who owns Sudha multiplex, Jagadamba Theatre, and Laxmi Theatre, along with his brothers, says his profit share from the multi-screen is more than the other two single screens.
“In a multi-screen, I can choose to screen five or six shows. However, in a single screen I can only screen a maximum of four shows. The week since December 25 had Solo Brathuke So Better also and Wonder Woman 1984 running. As a single screen owner, I was forced to run the Telugu movie for the entire week. If I am given a chance of screening five shows, I would decide on two shows of the English film and three shows of the Telugu one,” says Reddy.
A minimum parking charge of Rs 20 – 30 might increase their profit margin, he adds.
Mohammed Siraj Ahmad, exhibitor, distributor, and film producer, says the decision of theatres closing down and converting them to shopping complexes or godowns is more profitable than running the theatre with an increasing number of problems.
“If a theatre owner is getting Rs 5 lakh as rent, Amazon or other companies are offering these owners around Rs 8 lakh as rent, which is a huge profit for them,” says Ahmad.
Venkat Krishna says that he, too, is in a dilemma about whether to continue with the losses or rent his theatre as a godown or shopping complex.
While opening more screens or restoring the ones at the brink of shutting down may be a solution, Balwanth Singh, founder of Kauphy Talkies Pvt. Ltd., feels that no one is taking any efforts towards that.
“We are left with only 7,000 screens because of such problems. There has been no effort taken to increase the number of screens, even though India has a capacity of having 40,000 screens. The government needs to support the single screens which are shutting down and help them perform better,” he says.