Mumbai: Shrikant Bhasi’s remarkable journey started in a rather unremarkable Kerala town called Angamaly. He was looking at doing something in the Malayalam movie industry when he spotted an advertisement by Kerala State Industrial Development Corp. Ltd, an industrial and investment promotion agency of the Kerala government, seeking to lease out 17,000 sq.ft. on the fifth floor of a bus terminus complex.

Bhasi and his friends successfully bid for the space.

“When we announced that we would be constructing a multiplex, the state government officials laughed at me," says Bhasi. “There was no concept of multiplexes in Kerala. We brought a team from Mumbai and constructed a multiplex in that Tier III city." Carnival Films Pvt. Ltd began its meteoric rise to prominence from there with just three screens in 2010.

The company now operates more than 50 screens with an additional 75 screens expected to come on stream in the next two months, taking its total portfolio to 125 screens. To plot its expansion, Carnival took a short cut—three acquisitions in less than a year.

Backed by international agri-commodity trading company Advantage Overseas Pvt. Ltd, Carnival Films made three acquisitions in the current fiscal to take the number of screens it operates to more than 400.

Carnival bought out the multiplex business of Housing Development and Infrastructure Ltd (HDIL) for a little over 100 crore and signed a an agreement to acquire multiplex operator Big Cinemas, a division of Anil Ambani’s Reliance MediaWorks Ltd, for around 700 crore. On Thursday, Carnival said it has signed a binding deal to acquire Glitz Cinemas owned by Mukesh Ambani-controlled Network 18 Media and Investments Ltd.

Why Angamaly?

“Kerala, Chandigarh and Pune are great test markets. And I am from Angamaly," said Bhasi, who grew up in Bhopal but is now based in Singapore. Bhasi, after launching his agri-trading company in Bhopal, wanted to do some structured financing deals for Bollywood movies. Bhasi’s parents live in Angamaly while his family is in Mumbai.

“I moved to Mumbai from Bhopal in 1999. I had initial discussions with one of the leading Bollywood producers. But he was not willing to share sufficient information. So I decided to go and try out in Kerala as Bollywood was turning out to be expensive experiment," Bhasi says in Malayalam.

In 2011, he met renowned Malayalam movie director Sibi Malayil and agreed to produce a movie on an experimental basis. The result was Violin, a Malayalam musical romance film starring Asif Ali and Nithya Menon.

“Violin taught us everything in terms of structuring of funding. We realized that there weren’t sufficient theatres for the release of the movie. Then the idea of multiplex came," Bhasi added.

The estimated cost for Violin was 1.5 crore. But the budget exceeded the limits owing to experiments and did not collect well. “But the lessons were learnt. We seriously got into multiplex business in Tier II cities. We had added other elements to multiplex business to strengthen the business model," said Bhasi.

Bhasi added other verticals including hospitality, media, real estate, IT parks, event management, food courts and entertainment along with multiplexes. He also produced Malayalam movies and one Hindi movie.

“In multiplex business, we want to get into metros as the next level. We found HDIL’s multiplexes are a good point to enter. Later, we decided to bid for Big Cinemas," he said.

When Carnival bid for Big Cinemas, many thought Bhasi’s move was too audacious.

“Nobody ever heard about Carnival till then in Mumbai. HDIL was new to me. Now, he is making well calculated moves as film exhibition is a distribution-driven market. If he manages Big Cinemas acquisition successfully, Carnival will come into the big league," said a senior executive with a rival exhibition firm.

He points out that Carnival could command discounts from various vendors based on the number of screens.

But how is Bhasi funding all these acquisitions? He declined to disclose financial details.

“We are raising debt and we have internal accruals from various business units. Also, two private equity firms are talking to us to fund these deals," Bhasi said. He said there will not more acquisitions of this scale. “We are trying to add 500 screens organically."

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