‘Established filmmakers want to go with the sequels of earlier hit films like Housefull 5 or Mastiii 4. They don’t want to come up with fresh ideas. This is pure laziness.’

Universal Music acquired a 30 percent stake in Farhan Akhtar’s Excel Entertainment while Saregama invested Rs 325 crore to secure the exclusive music rights of Sanjay Leela Bhansali’s movies. These are signs of a deeper shift in Bollywood.

Corporate money is no longer cautiously testing the waters; it is stepping in as the last resort for an industry struggling with flops, rising costs, and vanishing profit margins.

At a time when box office volatility, rising star fees, and a brutal hit-flop ratio have pushed film studios to the edge, these high-profile deals signal a structural shift in how Hindi cinema is being financed and controlled.

In a candid conversation with dissects why production houses are seeking corporate lifelines, and says, “Filmmakers have to improvise or else there will be in huge debt in future. They have to pull up their socks. Corporates put money in businesses and know how to recover their money.”

This is not the first time corporates are investing in Bollywood. Earlier, we saw the Tatas and Birlas investing in Hindi film movies. What is different this time?

After a long time, we, as a film industry, are realising that Hindi films are not doing well (at the box office). When a company like Dharma, owned by Karan Johar, is asking for funds, it means their ROI (Return on Investment) is not great on the films they are making.

There are around four films on an average which a film production company releases in a year. Out of these, three don’t work and the only one that does recovers the losses of the other three.

Unfortunately, if that one film does average business, it drains the entire finances of the production house for that year, bringing them in bad debt.

For example, Excel Entertainment’s big budget movie Superboys of Malegaon put the company’s balance sheet in red numbers (since the film didn’t do well). Add to it Farhan Akhtar’s 120 Bahadur. When such films don’t work at the box office, the company is in trouble.

At the end of the day, Excel has to pay its staff salaries, which is a huge expense. They have to maintain their offices too. When three films fail consecutively, it becomes difficult to make films in future.

Is it true that the profits of Dharma Productions was as low as Rs 58 lakh (Rs 5.8 million) in 2024, and that’s why Karan Johar had to sell a 50 percent stake to Adar Poonawalla?

This news is in the public domain. The fact is that Dharma needed funds, as the balance sheet is not up to the mark.

Previously, when corporate groups like the Tatas and Birlas came in to invest in Bollywood, they came independently to produce movies. They made one-two films and went back.

The difference now is that corporates have understood that they are here to stay in the film industry by investing in production houses.

The production houses, on other hand, know that filmmaking is risky business because there is no formula for a hit film. So they need corporate money invested in their company.

The corporates want individual actors and individual affiliations with the film (for their brand valuation). Also, the kind of money they put in film production is less compared to their overall business value.

One can always say corporates don’t have a creative bone in their bodies, so are they the right people to be associated with a business like filmmaking?

They will never have creative inclination as they only understand business. But then, there has to be someone who has to keep a check (on the cost of making films). If there is no check, then a film that needs Rs 7 crore (Rs 70 million) will end up being made in double that amount.

So there has to be someone who understands finance. Every film, made on a big budget, cannot be Mughal-E-Azam. It can end up like Roop Ki Rani Choron Ka Raja (an expensive debacle).

Do production houses tend to overspend? If yes, can corporate houses bring in discipline?

Yes, they can bring in discipline. They are known for that. Some people don’t listen though. Rohit Shetty and Sanjay Leela Bhansali will never be bogged down by corporate decision-making. But then if there are 60 filmmakers, 50 will listen to the corporate demands of filmmaking.

Creativity will be in hands of creative people, but with the collaboration of corporates, there will be balance.

If a film scene requires the hero to smoke an expensive Cuban cigar, what happens if corporates asks to change it to an ordinary cigarette?

A director like Sanjay Leela Bhansali will ensure the shoot is stalled permanently. He will go with the Cuban cigar only. Corporates know they cannot push creative people too far.

Saregama invested Rs 325 crore (Rs 3.25 billion) in Bhansali’s production house, and it’s only for the music rights of his films. Will Saregama be able to recover the money?

One must know this is a long game plan. Sanjay Leela Bhansali is known to make good music in his films. Earlier, music companies used to pay money, but now you earn money through Spotify. Saregama has shrewd business heads leading the company. They know Bhansali will give outstanding music in his films.

If Saregama is putting so much money, they will ensure they will recover because Bhansali’s music is exclusive for them.

Can the same thing be said for Farhan Akhtar’s Excel Entertainment too? Universal Music is putting in Rs 800 crore (Rs 8 billion) in his company. How will they recover it?

The corporate groups have studied their work and their balance sheets before investing. Corporates want to maximise their money and maximise their reach in the film business.

On the other hand, Dharma or Excel need money to run their offices, so this is a marriage of convenience.

Yash Raj Films has kept away from corporate money. What have YRF done differently?

Aditya Chopra has managed the business of Yash Raj Films very well. Yash Raj has a huge film library and he makes a lot of money from ancillary businesses like the television industry or OTT.

When the entire industry was tilting towards OTT, Aditya Chopra was the only man who stood by cinemas. He made films only for theatres.

Moreover, Yash Raj is a cash-rich company. Their success ratio of hit films is good. Their success rate is big even if they make film like Jayeshbhai Jordar.

With one hit film like Saiyaara, Yash Raj can sail for two years.

Why you think filmmakers have not been able to grasp the changing tastes of audiences? A film like Dhurandhar came like a storm and a relatively new filmmaker like Aditya Dhar showed the path to success. But older, established filmmakers could not make such a successful film. Why is that?

You can call it intellectual bankruptcy of ideas, complacency, lethargy and not experimenting with filmmaking. They want to go with the sequels of earlier hit films like Housefull 5 or Mastiii 4. They do not want to come up with fresh ideas. This is pure laziness.

They are still doing Drishyam 3 or Raid 3 but do not want to make something that will stand out.

Dhurandhar is a fresh idea. It has changed the landscape of cinema.

This is the reason South Indian films do well as they come up with fresh ideas and experiment.

In this scenario, how will corporate money help and boost the filmmaking process?

Filmmakers have to improvise or else there will be in huge debt in future. They have to pull up their socks. Corporates put money in businesses and know how to recover their money.

The scale of films like Dhurandhar or Chhaava is huge, and you feel that’s why they are attracting audiences to theatres.
Do Indian audiences want to go to theatres only to watch larger-than-life movies but older filmmakers have no money to make them?

Theatre-goers love to watch movies which are larger than life. And to make such films, you need huge money. This is where corporates step in to put the money. To make movies like Dhurandhar, you need lots of money.

Films like Newton or Homebound can be watched on small screens. But if you have a film like Dhurandhar or Avatar, audiences will go to cinemas.

It is a clear demarcation now. If you want to make a small budget film, you have a space like OTT. But if you have to make a larger-than-life film, you need to go to theatres.

Is it true that 75 percent of Hindi films made in a year are flops, 20 percent manage to recover money and only 5 percent make money?

This is absolutely right. We make 200 films annually, out of which 30 to 40 work at the box office.

For example, take January 2025. All the 15 releases, including Shahid Kapoor’s Deva, flopped. The only film that worked was the February release, Chhaava.

If that’s the success ratio, how were film production houses running, say five years ago?

They ran because the overhead costs were not high. The film budgets were not as huge as stars didn’t charge hefty fees. The fee cost of stars is so high that individual producers cannot afford them.

All individual producers, like Sawan Kumar Tak, Ratan Jain from Venus, Vimal Kumar, Kuku Kohli… have disappeared. Then you have someone like Suneel Darshan, who dared to make Andaaz 2, but it flopped badly.

What is the cost of making a small film for an individual producer?

It will cost anywhere between Rs 10 crore to Rs 15 crore (Rs 100 million to Rs 150 million).

Will that kind of film get a theatre audience?

Only if it has something extraordinary.