New Delhi, May 6 -- Filmmaker Rajkumar Hirani, who is among the top names in the '100-crore' club, says that there is very little or no profit in making films.
The director of films such as 3 Idiots (2009) and PK (2014), which were declared as two of the highest grossing films in the history of Indian films, talks about the overall economics of the box office, saying, "When a film does ' 100-crore ticket sales, the producer gets about ' 25 crore. Thirty five per cent of it goes to the government as entertainment tax, in some states it is more and in some states it's slightly lesser, but on an average it is 35%. Out of the remaining ' 65cr, the multiplexes take 50% in the first week, 60% in the second week and 70% in the third week. That's the reason every producer wants that their film should make good money in the first week itself, because from the third week onwards, the multiplex makes more money than the producer."
There's more, he says. "Then there is distribution fee and advertising fee. Every ad that appears in newspapers and hoardings costs about 10-15%. So effectively, when you cull that out, only 25% is coming to the producer which is his production cost of making the film."
He further points out how the whopping amount of money spent on marketing is taking a toll. "If someone makes a film in say 5-6 crores, you would need another 5-6 crore for marketing, so yes, the profit in cinema today is very little because the cost of production and marketing is very high."
Producer Ramesh Taurani agrees."Sometimes, even a film that earns ' 100 crore is a loss-making proposition." Trade analyst Atul Mohan adds, "We declare a film as a hit based on ticket sales, but there are movies that have earned say ' 140cr, but their production cost is so high that the investors lose about ' 30-35 crores anyway."