Demand for Cinemas to Reopen After Rs 10,000 Cr Loss in 6 Months

Abira Dhar

September 18, 2020 at 3:15 a.m.·9 min read

Cinema theatres in India have been shut since 14 March because of the COVID-19 pandemic. The closure continues to affect the livelihood of lakhs of people.

According to the Multiplex Association Of India (MAI), the multiplex industry in India employs over 2,00,000 people, who are the backbone of the Indian film industry as they account nearly 60 per cent of revenues of film business.

MAI, the cinema body, which represents all the multiplex chains, including, PVR, INOX and Cinepolis made an appeal to the Indian government to reopen cinemas. Their main contention was that if malls, railways, airlines, gyms and metros have been permitted to reopen, why not cinema halls?

Here's Why Cinemas Need To Reopen

Speaking to the The Quint, Alok Tandon, CEO - INOX Leisure Ltd said, "We believe that cinema environments are more controlled spaces, than any other unrestricted public space. More importantly, by staggering the show timing, and by regulating entries and exits, cinemas can keep a check on crowd sizes. Lastly, the personnel who manage cinemas are professionally trained, and can, therefore, ensure compliance to the redesigned SOPs."

Adding to this debate as to why theatres need to reopen, Kunal Sawhney, Sr VP Carnival Cinemas, says that they did multiple surveys and found that around 75 percent to 80 percent people belonging to different age groups have said that they miss watching films in theatres and want cinema halls to be operational.

He adds, "There are so many people's livelihood dependent on this industry. Just not the employees but other people who are suppliers, transporters, etc. The economy has to comeback and we pay a huge tax to the government. When everything else is open now then why not cinemas?”

Several film producers and actors have come out to support the appeal by cinema owners. Several voices on social media have jumped in to back cinemas and the ongoing debate – if metros can operate why can't theatres?

Twitterati reacts to cinemas not opening.

Losses Incurred in 6 Months Is About Rs 10,000 Crore

According industry experts, the cinema exhibition sector generates revenues to the tune of approximately Rs 1500 crore per month. Given that lockdown on theatres has extended to six months now, the estimate is that the sector would have lost about Rs 10,000 crore so far.

"“We used to do a sale approximately of Rs 100 crore every month, that includes my box office collection and F&B collection. That’s my loss because cinemas have been shut across India for the past 6 months. But my expenses are still there, I have to pay my staff, I still have to pay electricity, the maintenance of the cinema, the AMCs, the property taxes and there is zero income. The losses we have incurred is approximately 40 to 60 crores in these six months.”" - Kunal Sawhney, Sr VP Carnival cinemas

Partial Lockdown Will Help Balance Footfalls in Cinemas

While cinema halls are gearing up to reopen, the struggle doesn't end even after it gets the state’s nod to open up. Despite lesser footfalls there will be extra investment on sanitisation and other precautions for the audience. Theatres are focusing to spend the first 30 days in building trust and confidence with their customers. Kunal Sawhney, Sr VP Carnival Cinemas says, "The first 30 days we will not consider it as an expense. It's more like a marketing cost which we will be considering to get business from the 31st day."

"“We have to make a safe and a robust beginning, which should be aimed at winning the faith and trust of our patrons. We know that revenues will follow, once our guests overcome their initial apprehensions. We are looking at these additional efforts on sanitisation as an investment towards strengthening our bond with our patrons.”" - Alok Tandon, CEO - INOX Leisure Ltd

We won’t see this kind of a crowd in a cinema in the near future.

They also hope that the continued partial lockdown will work in their favour. The average occupancy in India is 28 percent, and there were selected shows that would go full during the weekends. But now, because of the work-from-home situation and other restrictions, people are expected to make movie plans not only on a Friday evening but even on other weekdays.

"“With lesser number of shows now the audience will be spread. So the number of audience won’t come down. Once the content is back and people have the confidence to come back to cinemas, the number of footfalls will be there and it will be spread across all seven days and throughout the day.”" - Kunal Sawhney, Sr VP Carnival Cinemas

It is expected that once theatres reopen, it will take a month or two before the audience is fully comfortable with the idea of returning to the movie halls. With producers not willing to take a chance on releasing any new films in theatres immediately, what are cinema halls going to show once they reopen?

"“Over the immediate few weeks post reopening, we will have to rely on library content which has seen success in other global markets, where audiences have turned up. We are also witnessing a very interesting trend of movies of other Indian languages are going to get released in 4 to 5 other languages as well, adding to our content options.”" - Alok Tandon, CEO - INOX Leisure Ltd "“Initially for first 30 days or so we are planning show small films that are ready for release. Plus we will also do some film festivals. We can also screen some older films that people want to come and watch again.”" - Kunal Sawhney, Sr VP Carnival Cinemas

Precautions that Cinemas are Taking

Alok Tandon, CEO - INOX Leisure Ltd, assures that they are following all safety measures.

"All our guests will have to mandatorily wear masks, and there will be temperature checks happening at the entrance. We will also keep PPE kits available for purchases. There will be extensive sanitisation drills, disinfection processes at the right places and at the right moments. There will be pedal operated touch-free hand sanitisers placed at important locations across the cinema. Our shows will be programmed in such a manner that there are no simultaneous entries, intermissions and exits,” he said.

All necessary precautions will be taken for the safety of movie-goers.

In the age of the pandemic, the most important factor is safety and for this MAI in its appeal to the government has mentioned the following SOPs to be followed at theatres:

Only paying patrons visit us unlike other activities where there are no entry tickets
Movie show timings are staggered, therefore no crowd build-up
Controlled and regulated entry and exits
Availability of ample waiting areas
Cinemas are professionally managed, hence compliance to SOP is assured

Exhibitors are also depending on technology to keep human interaction at a minimum.

"“There will be a lot of focus on the digital way of life. Our team has developed a fully loaded all-in-one SMS. This SMS comes with 4 different links, one which allows you to check in with your QR code, second, which shows the auditorium’s seat chart and the location of your seat on the seat chart, so that you don’t have to enquire with anyone. The third link provides you access to the F&B menu to place your order and the fourth link allows you to download your complete e-ticket with all the details.”" - Alok Tandon, CEO - INOX Leisure Ltd

Extra precautions will be taken by movie theatres to ensure safety of the audience.

"“We are making sure everything is 100 percent touch-free. Before COVID-19, the time between each shows was 10 minutes, what we are thinking is to make it around 30 minutes to 45 minutes depending on the screen size. Not all movies will start at the same time, so that we can avoid crowd in the lobby. We will schedule it accordingly. We will be following MHA guidelines when it comes to seating arrangements but what we are proposing is members from the same family can sit together but we will leave a seat between every booking. Our entire staff has gone through a COVID-19 training and every fortnight we will be doing their medical checkups. Also, our entire food packaging will be changed.”" - Kunal Sawhney, Sr VP Carnival Cinemas

But the question is when will the public feel confident and safe enough to go back to the cinemas? Multiplex owners are hoping to see normalcy once new movies start releasing and Diwali is an event when they are hopeful to see movie-goers making their way to theatres with a big release.

While most multiplex chains can afford to stay afloat and change with the times, single screen owners are faced with the looming threat of a complete shut down as they are unable to bear the financial brunt of the lockdown.

Manoj Desai, who owns 8 theatres in Mumbai, including one of the oldest, Maratha Mandir, says he has lost Rs 60 to 70 crores in the past six months.

He adds, "It's going to be almost 7 months. There is no income but all expenses are still the same. Nor has the govt relieved us from property tax, neither has it relieved us of show tax. We have to also pay the minimum electricity bill. On top of that we have to pay the staff. Till now we have no notification as to when theatres will reopen."

Desai also says that the government has not sent a single letter whereas their association has written 8 to 10 letters to the Home Minister and to the Chief Minister. Akshay Kumar apparently offered to help them by contributing a month’s salary expenses but the offer was politely refused.