PremiumNEW DELHI : India’s fifth largest multiplex chain Miraj Cinemas is up for sale, having been unable to sustain since its foray into the film exhibition business in 2012, said people familiar with the development. The chain is owned by Rajasthan-based diversified business group Miraj, established in 1987 with multiple business verticals including tobacco, FMCG (fast moving consumer goods), pipes and fittings, stationery and infra-development.
Miraj has also co-produced Bollywood films such as Hema Malini-directed Tell Me O Kkhuda (2011), Naseeruddin Shah-starrer Sona Spa (2013), Irrfan Khan’s Madaaari (2016) and others.
“They have been wanting to exit for a while, film exhibition has not turned out as lucrative as Miraj’s other businesses," said one of the people mentioned above. When asked, Amit Sharma, chief executive at Miraj told Mint the company had only been looking at raising funds through a minority to majority stake sale for the past six to seven months but had paused all discussions due to covid.
But people in the know say the chain has already sold off a couple of properties in the interiors and small towns, where even paying for land rent was not feasible and plans to exit completely over the next couple of years. The Ficci-EY media and entertainment industry report 2020 estimates a 125 screen count for Miraj with 25 screens added in 2019, making it the fifth largest player in India’s multiplex market after PVR Cinemas (812), INOX Leisure Ltd (612), Carnival Cinemas (450) and Cinepolis India (381). The chain is mostly present in states such as Maharashtra, Rajasthan, Delhi, Punjab, Andhra Pradesh and Telangana.
While there isn’t complete clarity on whom Miraj has closed its deal with, people familiar with the development said Ajay Bijli’s PVR Cinemas has shown interest, particularly to develop Miraj properties as small-scale, cheaper, massy offerings for audiences in small towns.
If the deal is closed, this would be PVR’s second big expansion strategy in two years, the chain had bought a 71.7% stake in SPI Cinemas Pvt. Ltd for Rs. 633 crore in 2018, a move that helped India’s largest multiplex operator boost its presence in the lucrative south Indian market. The acquisition of SPI, the largest cinema exhibitor in south India, had made PVR the seventh largest cinema exhibitor in the world. Bijli’s company had also acquired Cinemax in 2013, followed by the acquisition of DT Cinemas in 2016. In 2010, INOX had acquired the 97-screen chain Fame Cinemas. All of the original owners exited the business after rebranding.
PVR did not respond to Mint’s queries.
Miraj, which had outlined plans last year to double its screen count from 100 over the next 15 months, has been hit by what industry experts call the perpetual ills of India’s multiplex industry. First in line, are high land rentals and entertainment taxes.
“Theatre owners have also themselves made the business unviable for the common man. Cinemas are now luxury restaurants where you go to enjoy exotic food and drink and watch a film at the same time," said Atul Mohan, editor of trade magazine Complete Cinema referring to exorbitant ticket prices especially in metros and big cities supplemented by outrageously expensive food and beverage options. For a family of four, a movie outing costs no less than Rs. 2,000, keeping several viewers away from theatres unless there is something truly special on offer.
Though the Miraj sale call is said to have been taken before the covid-19 crisis broke out, the pandemic has severely derailed India’s multiplex expansion plans, putting the industry under much stress. Exhibition industry experts say some chains have delayed plans by two or three quarters with limited cash flows making opening of any new properties impossible.
