Single-screen cinemas hold off on property conversion offers even as theatrical business declines

Original Hindi films, with the exception of period drama Chhaava, have barely brought any returns at the box office over the past few months. This comes on the heels of a steep decline in business in 2024 from levels in 2023.

While some single-screen theatres are open to diversifying to other streams, their executives say it is difficult to add eateries or entertainment zones because the developers don’t offer them favourable terms. Many others are holding off from converting their properties for now, given their passion for the film business.

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“The offers for single screens are plenty since these are fixed structures with all formalities complete and NOCs in place. But most of these aren’t lucrative for us," said Pranav Garg, managing director at Maya Palace, a theatre in Muzaffarnagar in Uttar Pradesh that recently converted to two screens from a single screen.

Garg emphasised it would be easy to create a food court, gaming or entertainment zone and a shopping centre within the cinema premises to lure families and children since there is ample space, but partners and developers want standalone theatres like them to operate only on revenue-sharing arrangements.

“We are giving up our space and bringing our reputation to the table so we would at least expect some minimum guarantees. We are anyway dealing with multiple taxes and failing business at the moment," Garg added.

The stark reality is that neither single screens nor multiplexes are able to meet the expenses of sitting on prime real estate, Bihar-based independent exhibitor Vishek Chauhan said.

Pandemic effect 

“The business is volatile and unstable, and one can no longer predict revenues, so everyone is feeling the pinch," Chauhan said, adding that it is common for theatre owners like him to receive offers to convert their space into malls, hypermarkets, eating outlets or banquet halls. But many are holding off for now.

To be sure, the covid-19 pandemic hit India’s single-screen theatres in more ways than can be imagined. About 1,500 such theatres stopped operations permanently during the lockdown, unable to meet recurring costs, staff salaries and zero incomes. Even after the pandemic, few Hindi films found favour with the audiences and box-office collections remained restricted to multiplexes in the metros and tier-one markets.

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Further, single-screen owners are plagued by the law in states such as Maharashtra that require that a plot that was originally designated a cinema property must have a theatre on the premises even if it is refurbished for other ventures.

Besides, single screens have long lacked the bargaining power of multiplexes and for years, producers and distributors have grabbed a bigger share of box-office revenue, leaving little for these cinema owners.

Following the pandemic, the number of single-screen cinemas in the country has dwindled to about 6,000, while there are over 3,000 multiplexes.

“Most single-screen cinemas are running on passion and because these have been owned by families for generations. These properties are located in prime locations in small towns, but the owners don’t have the wherewithal to redo or even reopen them, in many cases," said Arijit Dutta, owner of Priya Cinema in Kolkata, who has received multiple offers in the past.

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