Active Stocks
Tue Apr 16 2024 15:59:30
  1. Tata Steel share price
  2. 160.05 -0.53%
  1. Infosys share price
  2. 1,414.75 -3.65%
  1. NTPC share price
  2. 359.40 -0.54%
  1. State Bank Of India share price
  2. 751.90 -0.65%
  1. HDFC Bank share price
  2. 1,509.40 0.97%
Business News/ Industry / The big picture’s not so rosy for multiplex theatres next year
BackBack

The big picture’s not so rosy for multiplex theatres next year

After a bumper FY24 with hot hits such as Jawan and Animal, multiplex theatres are in for a slower FY25, says Crisil

Moviegoers have returned to the cinemas in big numbers but multiplex theatres would still need high-quality films offering a large-screen experience to improve occupancy levels. (HT)Premium
Moviegoers have returned to the cinemas in big numbers but multiplex theatres would still need high-quality films offering a large-screen experience to improve occupancy levels. (HT)

Multiplex theatres are anticipating that more people will opt to watch movies on the big screen and splurge more at the cinemas over the next few years, a belief fed by a bumper year of blockbuster movies. In FY25, though, they might have to be content with a more modest pace.

Movies such as Shah Rukh Khan’s Pathaan and Jawan and Ranbir Kapoor’s Animal are expected to have bumped up revenues for multiplexes by 20-24% in FY24. 

But for the upcoming financial year, Crisil expects revenue growth to slow to 10- 15% to 7,300 crore despite a lineup of movies such as Allu Arjun’s Pushpa 2 and Ajay Devgn’s Singham Again.

The operating performance of multiplex theatres had improved as moviegoers returned in big numbers after two years of covid-induced disruption. Occupancy surged to 25% in FY23 from 16% in the year before, but remained below the pre-pandemic level of 30-32% in FY20.

“Robust performance of several big-budget Hindi movies such as Jawan, Gadar 2 and Animal, and healthy performance of regional films should drive occupancy higher on-year to 26% (in FY24)," Naveen Vaidyanathan, director, Crisil Ratings, said in a statement. 

“With movie producers aligning better with audience preferences and a stronger regional film pipeline, occupancies should remain at 26-28% next fiscal and over the medium term," he added.

Even so, competition from video-streaming, or over-the-top, platforms will continue to pose challenges for the cinemas. 

With viewers having the option to watch new movies on these platforms after an eight-week exclusivity period for theatres, multiplexes will need a supply of high-quality films offering a large-screen experience to improve occupancy levels.

Multiplexes are also looking to keep their operating costs in check to boost their operating margin and cash flow, which would be more than adequate to fund spending on adding new screens and refurbishing old ones, Crisil said.

The rating agency added that multiplex theatres are likely to spend 600-800 crore annually over the next few years to add a net 100-120 screens.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

ABOUT THE AUTHOR
Lata Jha
Lata writes about the media and entertainment industry for Mint, focusing on everything from traditional film and TV to newer areas like video and audio streaming, including the business and regulatory aspects of both. She loves movies and spends a lot of her free time in theatres, which makes her job both fun and a bit of a challenge given that entertainment news often just talks about the glamorous side of things. Lata, on the other hand, tries to find and report on themes and trends in the entertainment world that most people don't notice, even though a lot of people in her country are really into movies. She’s a graduate of the Columbia School of Journalism.
Catch all the Industry News, Banking News and Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 28 Feb 2024, 06:47 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App