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world. A multiplex theater is defined as a movie theater with 3 or more number of screens. The first multiplex in India was opened at Delhi in 1997 by PVR with 4 screens. After initial mushrooming of multiplexes only in metro cities; now they have also spread to tier II and tier III cities/towns. Any city/town with a minimum population of 10-12 lakhs is considered to be a market for multiplexes. Recently multiplexes have come up in medium sized cities like Mangalore, Ghaziabad, Goa, Lucknow, Thane, Jaipur, Nasik, Rajkot, Aurangabad and many more small towns. Not only that; recently a multiplex was opened at a hill station like Darjeeling!! Major Trends in Indian Film Industry and Indian Film Exhibition Industry: Size of Indian film industry is estimated over INR 11,000 crores (~US$ 2.5 billion) and about 70% of this is contributed by box-office collection. Indian film exhibition industry is going through a major shift since introduction of multiplexes. The Indian film exhibition industry is shifting from the era of poor quality viewing, piracy and high entertainment tax to high quality viewing, technological advancements for piracy control and tax exemption for multiplexes. In 1990s; urban movie viewers preferred viewing movies in the comfort of their home by renting out media (earlier video cassettes and later CDs/DVDs). However sine introduction and proliferation of multiplexes in major Indian cities; this trend has changed largely as people are now craving for a wholesome better entertainment experience rather than just watching a 150 minutes movie in the comfort of their home. In India there are about 11,000 single screen movie theaters. However; due to fund shortages; their owners find it difficult to upgrade, renovate and well maintain these theaters. In past few years; multiplexes have become preferred choice of urban movie viewers for watching movies over single screen movie theaters due to several reasons. There are about 800 multiplex screens in India and the number is fast growing. It is expected to double up by 2013. Though multiplex screens make a small number of total numbers of screens in India; they contribute almost 50% of box office revenues in India today. Given the growth opportunities; global players are also eyeing Indian film exhibition industry to invest and get a share of the pie. At the same time; some major Indian multiplex players are also venturing outside India to grow
travel . Cinemax has currently 123 screens with 400 new screens planned over next 3 to 4 years. movies. phenomenal growth in retail sector. As a major trend. BIG Cinemas. PVR Cinemas operates with 35 cinemas in 20 cities in India with total 154 screens operational and additional 300 planned in next couple of years. BIG Cinemas currently operates with 253 screens pan India and have ventured outside India in US. gaming and advertising. Malaysia and Netherlands with total 516 screens globally. the spending of this group has seen increase in eating out. In smaller cities (or class B and C towns). Fame Cinemas operates in 12 cities currently with 97 screens. Inox Leisure Ltd. tax benefits for multiplexes and an increase in high grade Indian films. Major players in multiplex business in India are PVR Cinemas. most multiplexes are housed in upscale shopping malls where upper decks of the malls are dedicated for multiplexes making the shopping mall single stop shop for needs of urban families for shopping and entertainment. day of the week and seat preferences. Multiplexes have strategically prohibited carrying food and beverages from outside on the name of cleanliness. Morning shows are priced very low to attract school and college going crowds whereas weekend shows are priced quite to get maximum out of high income families who are willing to spend more money for weekend entertainment. Multiplexes have a better business model as compared to single screen movie theaters due to its ability of charging higher ticket price and generating additional revenues from complimentary offerings like food & beverages. demographic changes in Indian urban population. INOX Leisure Ltd.larger. Wave Cinemas. There are several drivers behind success of multiplexes in India including rise of disposable income of Indian middle class. currently operates with 41 multiplexes in 26 cities with total 155 screens. Fun Cinemas etc. With increase in the number of households in the high and middle income groups in India coupled with increase in their disposable income. Ticket prices in multiplexes in metros ranges from Rs 150 to Rs 300 depending on show time. Additionally Indian multiplex players are also venturing in to business of movie distribution. books. Cinemax India Ltd. ticket prices ranges between Rs 80 to Rs 150. Multiplexes adopt strategies to attract different masses with these variations of ticket prices. whereas in reality it’s a move to increase sale of food & beverages from its store and ultimately increasing revenue for themselves. Fame Cinemas. movie financing and movie production.
There are nearly 400 malls in India and many of them houses multiplexes as their long term tenants. number of screens and year of operation. Growth of multiplexes is going hand in hand with growth in number of high grade movies being produced per week. Many state governments have introduced entertainment tax benefits for encouraging investments in this sector. Earlier movie life was 1-2 months depending on content. however these days the life of movies has been shrunken to 1-2 weeks. Current Indian population is 1. Growth in both these factors will generate more revenues in the upcoming years. Different state Governments offer varying tax benefits to multiplex operators depending on seating capacity. they are able to conduct multiple shows of single movie in a day which can be as many as 30 shows per day at a single multiplex offering great flexibility for viewers in terms of show time. This is a major contributing factor to the success of multiplexes in India. This arrangement offers lot of convenience to urban consumers as malls become their one stop shop for weekly/monthly shopping and entertainment doze. Phenomenal growth in organized retail sector in India is another contributing factor for success of multiplexes. Indian Urban consumers have increased their overall expenditure on leisure and entertainment. For example most multiplexes in metro and tier I . Both have been complimentary to each other. The younger population is expected to have higher aspirations and more spending patterns on entertainment. These days 70% of collection is done within first week of release of movie and then depending on content of the movie it may or may not collect additional revenues. However this has been more suitable for multiplex model of business. The life of movie being screened has dramatically reduced in recent years.and leisure activities etc.21 billion with 50% falling in the age group of 0-25 years. Multiplexes are adopting different marketing strategies like low ticket charges for morning and weekday shows for attracting young consumers like school and college going students and young workers. This policy has encouraged investors bringing in more funds for establishing more multiplexes as well as many single screen theater owners for upgrading and converting it to a multiplex theater. This also helps film producers to maximize their collection in the first week itself. Because multiplexes have multiple screens. Multiplexes have also found it profitable to screen regional language movies and Hollywood movies.
cities screens south Indian. Major cricketing events like IPL. To address this. . Bhojpuri and Hollywood movies alongside mainstream Bollywood Hindi movies. Flocking at multiplexes is also somewhat seasonal. Shift of Indian movie watching crowd from single screen theaters and @home movie watching to multiplexes shows a clear shift of the demand curve on the right side as well as upwards. ICC Cricket World Cup for one day and T20 formats have major effect on seat occupancy of multiplexes. Continued growth in the number of multiplexes in India over past few years coupled with boosters from government in exemption of entertainment taxes and retail industry boom shows clear shift in the supply curve of multiplexes towards right side as well as upwards. many multiplexes are now offering live screening of these major cricketing events on its large screens!! Summary: Growth in number of high income and middle class households in India coupled with higher disposable incomes and higher spending capacities has put India in a favorable position for the growth of consumer industries.