Movies

OTT, cinema will exist in a symbiotic ecosystem: Mukta Arts MD Rahul Puri

He talks about the upcoming expansion plans

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MUMBAI: Mukta A2 Cinemas, from the house of Mukta Arts Ltd, now has 72 screens across the country after including the JV that it had with Asian Cinemas (11 properties). It also owns 22 properties and one in Bahrain. It is looking at properties at a place where it can fulfil a niche. The southern part of India is relatively under-screened terms of multiplexes, so that’s a destination Mukta Arts Ltd finds interesting.  “The important thing is that we are looking at screens that add value, that are profitable and the screens that we believe that are going to make sense for our stakeholders,” says Mukta Arts Ltd managing director Rahul Puri, in a freewheeling conversation with Indiantelevision.com. He dwells at length on the impact of COVID-19 in the cinema industry, industry trends, expansion plans, etc.

He feels that there is still great potential for the industry. For an industry like this, he says, 8000 screens for 120 crore people is nothing. So there is great potential. But, according to him, it can’t be done by the private sector alone, because the government holds the largest land bank in the country; everyone can talk about recession, but this is a sector that is resistant to recession. Though this is an interesting time for the OTT platforms considering the lockdown, he believes, OTT cannot supplant a theatre experience. As far as India is concerned, cinemas are part of household habits. The treat of a cinema visit, he says, cannot be replaced for many families across the country. He feels that the OTTs and cinemas will exist in a symbiotic ecosystem, both having their own USPs.

Excerpts from the interview:

How has the COVID-19 outbreak impacted the cinema industry in India? What kind of impact – short- and long-term – will it have on the sector?

The COVID-19 has impacted the sector and all businesses hugely. Projects are delayed, theatres are closed and business, in general, is at a standstill. This is hurting theatres most as they are businesses with high fixed costs which need to be running in order to make ends meet. In the short term, there will be a lot of issues for smaller players just being able to stay afloat at this point and in the long run as things return to normal you will see a bunching together of delayed projects which will continue to put pressure on distribution and exhibition infrastructure. The industry is in for a tough 2020.

What are the technological advancements and experiences Mukta A2 Cinemas offer?

Technological updation is imperative for any cinema chain to keep up with the progressing times. Mukta A2 Cinemas constantly updates itself with the latest technological trends to provide a high level of consumer satisfaction. With Dolby speakers and advanced projections, Mukta A2 Cinemas provides its patrons with pocket-friendly pricing, best quality technology and services, comfortable seating and varied options in food and beverages.

Please talk about the current footprint across India. What are the growth strategies and expansion plans of Mukta A2 Cinemas in India?

We are now at 72 screens across the country after including the JV that we have with Asian Cinemas in the Southern part of India. We are now at 34 properties across the country – with Asian Cinemas we have 11 properties. We own 22 properties and one property in Bahrain. The important thing is that we are looking at screens that add value, that are profitable and the screens that we believe that are going to make sense for our stakeholders.

Having said that, we have plans to expand in the next two years.  Our model has been two – three screens and we have some single screens. But mainly our advantage is that these screens were never particularly large with 250 – 300 seats. Therefore, our occupancy remains relatively high. And our catchment area does not have to be significantly large. However, now we are looking at much larger properties – some greenfield properties. In Bangalore, we are looking to build a 10-12 screen project in Yehlanka. In Bahrain, we have a six-screen theatre, which is also our largest by far. So, the model has shifted over the years.

Now the idea is to look at a much more big format where one can afford to dedicate certain screens to certain target groups – kids screen, screens for the bigger films, and particularly in the South that helps – they have Tamil, Telugu, Kannada, Hindi, English, Malayalam, so that helps. So those have a wide range of content. You can then fill up eight to 10 screens reasonably well.

What are your efforts in the preservation and restoration of various old theatres across India to preserve their heritage value?

It depends on where these heritage properties are. If they are in the heart of the city, then they are a value add. In Mumbai, we did Excelsior (at Fort), which was a renovation. I think it’s important to understand that we have to go where we believe there is a strong value proposition for us. That ultimately helps in pulling the TG to that screen, particularly if that is a two- to three-screen theatre. And I think that has been our model for success - you pick your content to bring TG, you get them loyal and then you surprise them with the content on screens.

Please talk about your expansion into tier I, II, III cities.

They are spread across the country – Kharagpur, Pune, a couple of properties in Bangalore and Ahmedabad. The south is a market of interest. We are looking at properties at a place where you can fulfil a niche. The southern part of India is relatively under-screened (not in terms of single screens, but in terms of multiplexes), so that’s a destination we find interesting. We are looking at doing a good mix between these bigger format screens, which probably will be the bulk of it, and less of traditional screens that we have done in the past – single screen renovations.

How has the industry evolved over the years? How do you evaluate the current and future trends in the field?

Well, the cinema business has been growing from level to level. If I must analyze the past few years, I could attribute the growth to two major factors. Primarily, the focus of cinema chain brands on updating technology and their endeavour to deliver a premium service to their consumers. Secondly, there is a major shift in the kind of content in films today. Last year, for example, was a landmark year. We had the superstars of the industry delivering underwhelming box office numbers while the “content-driven” films seemed to have masses flocking to the cinemas instead. Of course, this also has to do with the shifting mentalities of the audience; however, the shift comes from the producers first. In totality, for a cinema chain, this is all music to my ears. To have small films do two-three week runs at the box office.

The struggle, however, is more macro in that sense. For an industry like ours, to be honest, 8000 screens for 120 crore people, is nothing. So we should be looking for a way to try to push five to seven years to get up to 12,000- 14,000 screens but for that government as well as the policies are important. It can’t be done by the private sector alone, because the government holds the largest land bank in the country and everyone can talk about recession, but this is a sector – would not say is recession-proof but resistant to recession.

Do cinemas face an existential threat from the OTTs? How are cinema houses coping up with the change?

This is an interesting time for the OTT platforms considering the lockdown. People have no other option but to watch shows and films online. But to talk about the trend in general, the streaming industry has certainly found their niche; however, the cinema-going experience cannot be compared. Hindi cinema has always been evolving and coming with interesting technologies that are making the movie-going experience all the more exhilarating. However, there are films that need a cinematic platform. As far as India is concerned, cinemas are part of household habits. The treat of a cinema visit, I suspect, cannot be replaced for many families across the country. To answer your question objectively, I think the OTTs and cinemas will exist in a symbiotic ecosystem, both having their own USPs.

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