Industry
The curious case of mid-budget breakout hits
Summary
While big-budget blockbuster films often yield lower long-term profits due to high production costs, mid-budget successes like Stree 2 demonstrate the potential for profitability.
NEW DELHI : The Indian box office now belongs to large-scale spectacles like Baahubali, Pathaan and Kalki 2898 AD—films that go on to set new theatrical milestones.
However, despite setting the box office on fire, they tend to remain low on profitability. A business of ₹500-600 crore on an investment of ₹200-300 crore is a big fuss over a trifle.
In that sense, trade experts believe horror comedy Stree 2, made with an investment of around ₹60 crore, is the rare mid-budget film to have really broken out and earned over ₹600 crore.
Also Read: Stree 2 rescues PVR Inox in an otherwise dull quarter
Lower-scale and modestly budgeted breakout hits are nowadays few and far between in the country. In 2023, Gadar 2 managed the feat, earning around ₹515 crore on a budget of ₹74 crore.
“Mid-budget films don’t always have big stars, and it’s difficult to tell real mass-market stories without them. Stree 2 is the rare mid-budget film to have found audiences in urban as well as smaller centres, which is not usually the case. Films that do well in the metros often fail in tier II and tier III markets," said Rahul Puri, managing director of Mukta Arts and Mukta A2 Cinemas.
He added there's a conversation going on in the industry about rationalizing costs. However, while the VFX for Stree 2 may have been put together well enough to suit the particular film, it may not be suitable for some bigger-scale movies.
Also Read: From fright to family fun: Stree 2 and the coming of age of horror in India
Other than the horror comedy, mid-budget films that have made a big splash include the 2019 war drama Uri—The Surgical Strike, which earned over ₹244 crore on a budget of ₹44 crore, and the 2022 political drama The Kashmir Files, which earned ₹246 crore on a budget of ₹25 crore.
Business sense
A film that makes ₹500 crore on a budget of ₹300 crore is different from the one made for ₹20 crore and earning ₹100 crore, said Amit Sharma, managing director of Miraj Entertainment, a company that operates multiplex theatres in the country. “Both have gone right in their own way in a business where even a 20% profit is good enough. Big films also require big marketing budgets to generate the right buzz, especially for the first weekend."
He said one way to make audiences curious without spending exorbitant amounts is to capitalize on the recall value by releasing sequels. He highlighted that, like Gadar 2 and Stree 2, a host of sequels, including Housefull, Welcome, Jolly LLB, Raid, War, and so on, are set to vie for eyeballs in the coming months.
That said, trade experts clarify that other sales channels, such as digital and satellite rights, fetch higher sums for big-budget films than films like Stree 2 and Gadar 2, enabling them to increase their profits.
Also Read: At the box office, a dull first half punctuated by small moments of delight
Big-star films with high production values also tend to do better overseas than mid-budget movies that have found unexpected success.
“The idea is to have good enough variety for audiences in theatres and not supersaturate any one genre. Theatres don’t just need spectacles but films that can cut across multiplexes and single screens and appeal to every strata and demography," said Akshaye Rathi, a film distributor and exhibitor.
