The document discusses the Indian film production industry and its relationship with finance. It first provides background on the history and components of the Indian film industry. It then focuses on analyzing Eros International Media Ltd, a major publicly listed production company, to understand how the industry is becoming more profitable. Eros has been successful due to its large film library, global distribution network, and multi-platform monetization model including its Eros Now streaming service. The future looks promising for the industry given the growing Indian and global audience, potential for increased theater screens and ticket prices, and opportunities for co-productions with Hollywood studios.
It talks about the historical perspective of Japanese Cinema. It highlights the popular genres, stalwarts in film making, golden era of Japanese Cinema... etc.
It talks about the historical perspective of Japanese Cinema. It highlights the popular genres, stalwarts in film making, golden era of Japanese Cinema... etc.
Cinema has always been one of the greatest source of entertainment since ages . This presentation will take you in a flashback journey of our glorious 100 year's of Indian Cinema.
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The history of Cinema spans over a hundred years, from the latter part of the 19th century to the present day and beyond. Motion pictures developed gradually from a carnival novelty to one of the most important tools of communication and entertainment, and mass media in the 20th century.
Motion picture films have had a substantial impact on the arts, technology, and politics. This slide will take you through the evolution of the Cinema and the how the story telling narrative changed over years.
This is a presentation I prepared a few years ago for my Computer Applications for Mass Communication classes. It is a conglomeration of several online and ongound sources; most of the content (text & graphics) are not mine. No copyright infringement intended
Cinema has always been one of the greatest source of entertainment since ages . This presentation will take you in a flashback journey of our glorious 100 year's of Indian Cinema.
Don't start your independent animated feature film without a review of this handy PDF checklist covering the business of formation, development, production & post-production.
The history of Cinema spans over a hundred years, from the latter part of the 19th century to the present day and beyond. Motion pictures developed gradually from a carnival novelty to one of the most important tools of communication and entertainment, and mass media in the 20th century.
Motion picture films have had a substantial impact on the arts, technology, and politics. This slide will take you through the evolution of the Cinema and the how the story telling narrative changed over years.
This is a presentation I prepared a few years ago for my Computer Applications for Mass Communication classes. It is a conglomeration of several online and ongound sources; most of the content (text & graphics) are not mine. No copyright infringement intended
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Globalizations of Entertainment industry in India.Tarun Agrawal
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The presentation is on the topic- Indian Film Industry, and is mainly concentrated on Bollywood.
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Indian Film Production Industry Term Paper
1. Indian Film Production Industry & its relationship
with finance
Team: Ahmed Kamal, Usman Ali, Rituraj Bhuyan
Abstract
The film industry in India has evolved over the years by
selling one commodity i.e. movies. In the term paper, we
research this industry from a financial perspective. Firstly,
we do a literature review of the history of the film
industry, what are the components of this industry, what
are its it’s regional & global audience & how much does
it contribute to the economy. After that we do a detailed
research focusing on a publicly listed production
company’s Eros International Media Ltd. to find out what
is making this industry more profitable & what is the
future of this industry from a financial standpoint. For
example, what are the new markets for this industry, how
producers are increasing their international marketability,
its sources of funding, who are the various investors, what
are the challenges etc. That is we analyses the data and
make conclusions about what it should do moving
forward.
2. Indian Film Industry
Indian film industry is a multi-lingual film industry. The
industry is supported mainly by the Indian audience in
India & also in countries where there are increasing
number of expatriate Indians. The biggest film industry is
the Hindi film industry which is mostly concentrated in
Mumbai (Bombay) and is referred to as Bollywood an
amalgamation of Bombay & Hollywood. The other
largest film industry is the Tamil cinema industry located
in Chennai & Telegu cinema located in Hyderabad. The
remaining film industries are spread across India in states
like Punjab, Bengal, Maharashtra, Orissa, Kerala &
Karnataka. Over the past few years, regional films have
been growing popularity with releases in India & abroad.
History of Indian Cinema
The screening of the Lumiere moving pictures in London
made cinema became a sensation across Europe & by
July1896 Lumiere film was shown in Bombay. It was the
3. first moving picture shown in India. The first full length
motion picture called Raja Harischandra was produced by
Dadasaheb Phalke in 1913. The film marked a start of the
Indian cinema. In 1931, India’s first talkie Alam Ara was
released which was dubbed in Hindi & Urdu. In 1930’s &
1940’s talkies depicting social difference of caste, class &
relationship between sexes were released. Some
organizations like All India Progressive Writers
Association and the Indian People's Theatre Association
(IPTA) are formed during this era. During the 1950’s
Calcutta became a major place for Indian cinema. In the
1960’s main genres shown in cinema were romantic &
Indian nationalism. In the 1970’s numerous film societies
were formed across India. In the 1980’s film’s took a
stand on social issues. In 1990’s video, television & cable
resulted in the troubles for the film industry where
commercial films are at risk of failing more often.
From the 2000 & beyond the genres started changing. The
genres from 2000 and beyond are shown in a pie chart.
4. Indian cinema has been recognized at the American
Academy Awards. Three Indian films, Mother India
(1957), Salaam Bombay (1988) and Lagaan (2001) were
nominated for the Academy Award for Best Foreign
Language Film.
Action
45%
Romantic
31%
Historical
13%
Thriller/Horror
11%
5. Components of the Film Industry
1.Production Companies: Since our focus is on the
production companies, therefore production is an
important part of the industry. Some of the big
production companies are as follows.
a. UTV Motion Pictures Ltd: Is a production
company founded in 2004 by Ronnie Screwvala
and is owned by the Walt Disney Company. It is
involved in film production, distribution, licencing
& merchandizing. Some of the films produced are
Swades, Life in aMetro, Jodha Akbar, Chennai
Express, 2 States.
b.Eros International Media Ltd: One of the biggest
production houses in the country. It is a Mumbai
based production and distribution company which
was founded in 1973 by Arjan Lulla. It is a public
limited company with a network in 50 countries.
Some of the movies produced are Love Aaj Kal,
Om Shanti Om, and Student of the Year.
6. c. Yash Raj Films: is a private production house
which was set up by Yash Chopra in 1970. It is one
of the prestigious production companies. This
company has given some of the best movies like
Mohabbatein, Veer Zara, Silsila, Deewar.
d.Dharma Productions: This was set up by
producer director Yash Johar in 1976 and is now
headed by Karan Johar.
e. Balaji Motion Pictures: One of the biggest
productions companies and is a subsidiary of the
leading television production house Balaji
Telefilms. This house is owned by Ekta Kapoor &
established by Jeetendra in 2001.
f. Red Chillies Entertainment: It is private limited
company founded by superstar Shahrukh Khan and
his wife Gauri in 2002. The company owns a stake
in the IPL team Kolkata Knight Riders. Some of
the greatest hits are Main Hoo Na, Ra One etc.
7. g.Reliance Big Entertainment: This is a subsidiary
of the Reliance Group which entered into film
production in 2005. The company has launched TV
channels & radio stations in addition to films likes
Kites etc.
h.Rajashri Productions: The film production was
known for giving family based entertainers in
Bollywood.
Film Kraft Productions, Aamir Khan Productions, Mukta
Arts, Hari Om Entertainment are some of the other
production houses.
8. Other Components of the Film Industry include
• Directors, Actors
• Buyers Involved
• Distributors
• Exhibitors
• Satellite Rights
• Music Rights
Thus we have seen the components of the film industry.
Regional Films in India
Cinema is India is mainly dominated by Hindi language
films which generally makes significant portion of the
box office collections. However, regional films have been
growing in popularity both in India & abroad. Within the
regional segment, South Indian movies account for a large
number of film releases with the five states Andhra
Pradesh, Telengana, Karnataka, Tamil Nadu & Kerala
accounting for most number of films. Bengali, Bhojpuri,
Marathi & Punjabi are some of the regional markets.
9. Diagram shows the Market Share of the various language
categories.
Global Audience
There has been a global demand for Bollywood content
particularly among the South Asian diaspora.
The movies which are dubbed in more than 25 languages
have a significant demand in Europe & South East Asia is
making the movies increase their international footprint.
10. The bar chart shows the target population in various countries where
movies are in demand.
11. The Turn around Industry Status
Before 2001 the filmmakers were hugely dependent on
underworld & filmmakers for finance. However, now
after the major policy initiatives by the Government of
India “industry” status is given which has allowed
filmmakers to access institutional finance. Various banks
are pumping money into the movie making business.
Other than that various individual investors & capital
investors have also started investing in this industry.
Now we will describe a big production house in India
called Eros International Media Ltd. We analyse the
company & its business, its financials, its risk factors &
growth. Taking this company as an example we can now
conclude in which direction the production industry is
going.
Eros International Media Limited
• Eros International Media Limited is a part of the Eros
International PLC, the holding company of the Eros
Group. This company was founded by Arjan Lulla
way back in 1977. It is a leading global company in
the film production industry. Eros co-produce,
12. distribute and Indian language films in various
formats including theatrical, television & digital
formats. 200+ new releases over the last 3 fiscal years
Some of the salient features of Eros International
Media Ltd include
Content library of 2,000+ films
Film content across Hindi & regional languages
Subtitled content in 25+ different languages
Multi-channel global distribution in 50+ countries.
Vision of Eros International Media Ltd
It is our vision to build on the market leadership position
within the filmed entertainment arena & expand within
the rapidly growing Indian media & entertainment sector
by capitalizing on our library, distribution network &
strong balance sheet.” Kishore Lulla
Executive Director.
13. Leading Theatrical Market Share
Eros International Media participated in 3 of the top 10
releases each year. 7of the top 15 Hindi Films in 2015 are
Eros Films
Diagram shows popular Eros film Bajrangi Bhaijaan topping the charts.
14. Multi-Platform Content Monetization Model
Content can be monetized in many different ways & Eros
has become a leading player in the multi-platform content
monetization model. Some of the sources of content
monetization are as follows.
1. Theatrical:
2. TV Syndication
3. Digital
4. SVOD/VOD
5. Music Publishing
6. Ancilliary
Diagram shows the multi-platform content monetization model of Eros.
15. Eros Now
Eros Now is the new Netflix of Bollywood. Eros
Now has now a subscription based on-demand
entertainment portal with over 14 million registered
users. The subscribers have access to numerous
content offerings including movies, music videos,
TV episodes and original videos. Eros Now is now
available on any internet enabled devices tablets etc.
Diagram shows the Netflix portal
16. Diagram shows the Eros Now Portal
Eros Now is positioned to capitalize the growing internet
penetration in the market. Also, it has given users the
promise of endless entertainment.
Risk Factors & Remedies
The film production industry like any other industry is not
without any risk. Some of the risk involved is as given
below.
1.Risk of flop movies: Risk does arise when a movie
flops. Numerous Eros movies have gone through this
bad phase. In case of flop movies remedy is to
increase the digital content to monetize for the loss in
revenue.
17. 2.Competition from other production companies:
As we have seen that there are many other production
companies competing for hiring or making contract
with top notch actors and actresses. In such a case
make long term contracts with famous actors,
directors and music directors.
3.Political Risk: In some of the films produced in
India there were lot of political controversies. For
example movie like Madras Café did create a lot of
controversy & the movie was not screened in Tamil
Nadu. The remedy for such a risk is to use less
politically sensitive content.
4.Media Speculations & Impact on Stock:
Sometimes media speculation can bring the stock
price down. In such a situation use give a
confirmation statement in the media that actual
performance is much better than speculated.
Financial Analysis
Now we analyses the financial health of Eros
International Media to find out more about the financial
of the film production industry in particular.
18. Some of the salient features of Eros International are
as follows
1.Strong track record of revenues
2.Strong track record of EBIT & PAT growth
3.Multi-channel distribution maximizes sources of
revenue
4.Good Balance Sheet
5.Impressive films line up for 2016 & 2017
Revenues.
Bar chart shows revenue in an upward trend
19. EBIT
Bar chart shows EBIT in an upward trend
PAT
Bar chart shows PAT in an upward trend
20. Diversified Revenue Streams
Pie chart shows the Diversified Revenue streams
Good Balance Sheet
If we analyse the balance sheet as of March31, 2015
Cash 1735
Total Debt 4875
Net Debt 3140
Shareholders Equity 14822
Net Debt/Equity =0.21, Net Debt/EBIT =0.87
Strong liquidity ratios.
21. Impressive slate of films lined up for 2016 & 2017
Eros International has already lined up an impressive
slate of films for the year 16 & 17. Some of the film
names released are as follows.
1.Housefull3
2.Shiva
3.Untitled
4.Farzi
5.Banjo Rabta
6.Juagaadu etc.
Thus, we can see the 16 & 17 are going to be profit
making years for Eros.
The projected revenues, EBIT, PAT are shown below
22. Shareholders
Shareholders of Promoter & Promoter Group holds
more than 75% of the shares.
Some of the other shareholders other than promoters are
1.Indus Capital Advisers (3.7%)
2.IDFC Sterling Equity Fund (1.6%)
3.Kamal Kara (1.25%)
4.Rising India Focus Fund Limited (1.11%)
5.India Max Investment Fund (.70%)
6.Mirae Asset Global Investments (0.55%)
7.Citigroup Global Markets (.53%)
Stock
The Stock of Eros International Media has seen an
upward trend with a little downward effect recently.
However, overall it’s in the upward trend.
23. Diagram shows Stock price from 2011 to 2015
Dividend Policy
With a view to strengthen the financial position of the
company Eros International Media Ltd. normally does
not give dividends. The industry is such that it requires
a lot of liquid cash for production purposes as well as
investing in overseas. So, all of the retained earnings
are used for these purposes. Hit movies bring a lot of
profit but if the movie gets flopped then the company
has to bear its losses. The preference of our major
shareholders is capital gain rather than dividend yield.
24. Comparison with other production companies
Eros International Media has performed better than its
competitors in the home market and has also done well
abroad.
Market Share in US.
Market Share in UK
Therefore, we can see that Eros market share in US, UK
is better than Yash Raj Films, UTV, Reliance & others.
25. Future opportunities in the Indian film production
industry
Eros International has shown that production industry is a
profitable industry. If we take Eros International as a
model for the production industry we can say that
production industry in India has opportunities for
tremendous growth.
Most of the production houses are still private production
houses which mean making Hollywood level films
becomes a challenge. Once more companies become
publicly traded companies in this industry we can have
giant production companies like Walt Disney making
high budget films.
Although there is a perception that theatrical market in
India is saturated, the theatrical market in India is still an
underpenetrated market. If we compare theatre screens
per million population of US & India, we can see US has
125 screens per 1 million & India has only 7 screens per
million. Germany has 57 screens/million, UK has 67
screens/million & France has 85 screens/ million which
indicates that the theatrical market is underpenetrated.
There is a substantial room for ticket price increase. The
average admission price in India is around 50 cents
26. compared to other countries where ticket prices are 10
US$ and above. Therefore there is a room for increasing
revenues in this area.
The growing Indian TV market should also help increase
revenues for production companies. The TV household
penetration went up from 61% to 71% in the recent
years.Apart from theatre & TV digital market is the
fastest growing as internet users are increasing day by
day.
There is a large scope for films to earn revenues globally
as South Asia diaspora around the world is increasing
rapidly. So within the global community production
companies do have a reasonable market.
Co-production is an area where production companies are
focusing on recently. There is a huger opportunity in this
area. International film studios such as Warner Bros.,
Disney, Fox and DreamWorks have made collaborations
with local film production companies to develop movies
in India. Walt Disney has a 50% stake in UTV. Therefore,
there is an opportunity for big production companies to
merge or to get involved in a joint venture with
Hollywood production houses to increase market share in
overseas markets.
