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Multiplex and Single Screen Cinemas - India

March 2009
Executive Summary

 Estimated to be worth INR XX bn in 2008 and INR YY bn in 2012


Market  Key Segments: Single and double-screen cinemas and Multiplex cinemas
 Multiplex segment is growing while single screen segment is declining
 Southern Indian states together account for x% of the number of theatres in India
 Drivers:
Drivers &
Challenges
LE
– Supply side: Growth in Film Industry , improving supply of real estate and favourable tax exemptions
– Demand side: Favourable demographics, rising income levels and willingness of people to spend on recreation

P
 Challenges: Uncertainty over entertainment tax, slowdown in economy, alternate entertainment

Characteristics SAM
avenues, development delays and piracy

Characteristics
 Seasonality
Trends
 Producers bypassing distributors
 Reducing shelf life of movies  Shift to digital cinema
& Trends
 Low screen density  Alternate content in multiplexes
 Increasing average ticket prices  Retail partnerships
 New format in single screen theatre
• Single screen segment : Highly fragmented and unorganized
• Multiplex segment : Dominated by five organized players
Competition • Major players in Multiplex segment: Company X, Company Y and Company Z
• Fierce competition in multiplex segment

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•Market Overview
•Business Model
•Drivers & Challenges
•Characteristics & Trends
•Competition
•Key Developments

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Cinema exhibition comprises of single-screen and multiplex
theatres, with the latter growing rapidly
Overview Market size & growth
• Key Segments INR bn
 Single and double-screen cinemas 150 +a%
+c%
 Multiplex cinemas, i.e. three screens or more Z
100 +b%
• Multiplexes account for: Y

E
X
 x% of the total number of cinema halls

PL
 y% of total cinema screens in the country
• South Indian states together account for x% of the
50

0
number of theatres in India

Theatre distribution
SAM 2006

Growth of Multiplexes
2008 2012

Others Andhra Pradesh Screens


t% u% 1,500 +a%
+c% Z

1,000 +b% Y
Uttar Pradesh z% v%
Tamil Nadu X
y% 500
Maharashtra x% w%
Karnataka Kerala 0
2006 2008 2012
Source:

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Ticket and F&B sales contribute to bulk of revenues

Primary Revenue Primary Costs


Ticket Sales x% Distributor’s Share x%
F&B Sales y% F&B Cost y%
Advertising Revenue z% Entertainment Tax z%

Exhibitor
Secondary Revenue Secondary Costs
Parking Charges x% Rent / Rev Share x%
Management Fee y% Overheads y%
Convenience Fee z% Personnel Cost z%

Ticket

w%
Advertising Others

x% y% z%
PLE Distributor F&B

v% w%
Taxes

x%
Rent

y%
Others

z%

F&B Parking
v%

SAM
Source:

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Drivers

Favorable Willingness of people


Rising Income levels
Demographics to spend on recreation

Demand Side

Drivers

Supply Side

Growth in Improving supply of


Tax Exemptions
Film Industry Real Estate

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Challenges

Slow down in
economy

Uncertainty over Alternative


entertainment modes of
tax entertainment

Challenges

Development
Piracy
delays

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Key Trends

Producers bypassing distributors

Shift to Digital Cinema

Alternate content in multiplexes


Trends

Retail partnerships

New format in single screen theatre

Source:

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Single screen segment is unorganized while multiplex segment is
highly organized and dominated by five players
Competition Number of screens multiplexes
•Single screen segment is highly fragmented 200
Number of Cinemas Y
with few owning more than one movie hall Number of Screens
150
•Five players dominate the multiplex industry
Y
•Box office revenue breakup in multiplexes: Y

E
100
Y X
 x% from Hollywood movies

PL
 Over y% from local Hindi language movies
50
X X X
X
Y

M
•Occupancy levels 0

A
 Multiplexes : x-y% Company Company Company Company Company

S
x Y z V W
 Single screen cinemas : a-b%
Footfalls and Occupancy ratio
•Fierce competition in multiplex segment due
Occupancy
to attractive economics and growth potential mn %
Footfalls (mn)
 Leading players have major expansion plans 20 U c% 50
 Many new players are planning to enter this b% 40
15 W d%
industry a%
30
10
V X 20
5 10
0 0
Company X Company Y Company Z Company V
Source:

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Thank you for the attention
The Single Screen and Multiplex report is a part of Netscribes’ Entertainment Industry Series.
For more detailed information or customized research requirements please contact:

Natasha Mehta, CFA Subhash Chennuri


Phone: +65 9651 6382 Phone: +91 98190 59664
E-Mail: natasham@netscribes.com E-Mail: subhashr@netscribes.com

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