Indian Institute of Management (IIM) Lucknow
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Indian Institute Of Management (IIM) Lucknow MARKETING PROJECT ON ““EMERGENCE OF PVR IN INDIA”” Syndicate -3 (DGMP - 13) XXXX XXXX XXXX 1 Introduction 1. 1. In the literal sense, aa multiplex can be defined as a ““single complex with multiple screens.”” They are built in specifically-designed buildings and as per its capacity, it can accommodate numerous people. Origins around the world 2. 2. In December 1947, Nat Taylor, and operator of a theatre called ““Elgin Theatre”” inin Ottawa, Canada, opened a smaller second theater named "Little Elgin", right next door to his first theater. However, it was only in 1957 that he started to run different movies in each theater. Later in 1962, he opened dual-screen theaters in Montreal and then in 1964, in Ontario. In Apr 79, he opened an 18-screen multiplex under one roof in Toronto's Eaton Centre. Later in Dec 96, AMC Ontario Mills 30, opened a 30-screen theater in California that became the theater with the largest number of screens in the world. Today, Kinepolis Madrid in Spain is the world's largest cinema complex with 25 screens and a total seating capacity of 9,200. Early Years of Multiplex Cinema in India 3. 3. Movie-exhibition till the mid-90s was dominated predominantly by the single screen halls. Also, the surge of customers to watch movies was mostly during holidays, on weekends or around festivals. In India, the multiplex culture started to bloom in the mid-90s. It enticed the customers with not only the prospect of upgrading the concept of watching movies but transformed it into a whole new experience. History of PVR Cinemas 4. 4. During this time, in 1997, the Bijli family, a distributor of Hollywood films inin India, thought of starting the multiplex business. The company came into existence with a joint venture between “Priya Exhibitors” and “Village Roadshow”, an Australia-based company that is one the largest exhibition companies in the world, with more than 1,000 screens under operation. This joint venture led to the formation of ““Priya Village Roadshow.”” The Company was incorporated on 26 Apr 95 under the Companies Act as "Priya Village Roadshow Limited" and obtained a certificate of commencement of business on 04 Dec 95. 2 Introduction 1. 1. In the literal sense, aa multiplex can be defined as a ““single complex with multiple screens.”” They are built in specifically-designed buildings and as per its capacity, it can accommodate numerous people. Origins around the world 2. 2. In December 1947, Nat Taylor, and operator of a theatre called ““Elgin Theatre”” inin Ottawa, Canada, opened a smaller second theater named "Little Elgin", right next door to his first theater. However, it was only in 1957 that he started to run different movies in each theater. Later in 1962, he opened dual-screen theaters in Montreal and then in 1964, in Ontario. In Apr 79, he opened an 18-screen multiplex under one roof in Toronto's Eaton Centre. Later in Dec 96, AMC Ontario Mills 30, opened a 30-screen theater in California that became the theater with the largest number of screens in the world. Today, Kinepolis Madrid in Spain is the world's largest cinema complex with 25 screens and a total seating capacity of 9,200. Early Years of Multiplex Cinema in India 3. 3. Movie-exhibition till the mid-90s was dominated predominantly by the single screen halls. Also, the surge of customers to watch movies was mostly during holidays, on weekends or around festivals. In India, the multiplex culture started to bloom in the mid-90s. It enticed the customers with not only the prospect of upgrading the concept of watching movies but transformed it into a whole new experience. History of PVR Cinemas 4. 4. During this time, in 1997, the Bijli family, a distributor of Hollywood films inin India, thought of starting the multiplex business. The company came into existence with a joint venture between “Priya Exhibitors” and “Village Roadshow”, an Australia-based company that is one the largest exhibition companies in the world, with more than 1,000 screens under operation. This joint venture led to the formation of ““Priya Village Roadshow.”” The Company was incorporated on 26 Apr 95 under the Companies Act as "Priya Village Roadshow Limited" and obtained a certificate of commencement of business on 04 Dec 95. 2 5.5. In 1997, with the help of Village Roadshow‟s international experience, the company launched India‟s first multiplex, PVR Anupam in Saket, New Delhi. Furthermore, it also introduced computerised box office operations by selling computerised tickets, for the first time, at PVR Anupam. This cultural change in movie-viewing was a grand hit. As a result, after the success of PVR Anupam, the company opened a single-screen cinema, PVR Priya at Vasant Vihar, New Delhi in Jan 2000. Thereafter, in Aug 01 it opened PVR Naraina and in Nov 01, PVR Vikaspuri, both again in New Delhi. In May 03, the company opened a seven-- screen multiplex, PVR Gurgaon in Gurgaon followed by PVR Plaza, a single-screen cinema with a heritage ambience at Connaught Place, New Delhi, in May 04. Thereafter, it launched PVR Bangalore in Nov 04, which became the then-largest multiplex in India. 6. 6. In Nov 02, Village Roadshow sold its entire stakes to Priya Exhibitors. Consequent toto the exit of Village Roadshow Limited from the Company, the company changed its name from "Priya Village Roadshow Limited" to "PVR Limited". It also changed its registered office within the same state from 50, West Regal Building, Connaught Place, New Delhi 110 001 to 61, Basant Lok, Vasant Vihar, New Delhi 110 057. The change in registered office was approved by a resolution of their Board on 05 Aug 05. General Market Conditions 7. 7. Since the advent of PVR, the dynamics of the entertainment industry completely changed. Today, the audience for traditional cinema hall-viewing has reduced considerably. The multiplexes are not just considered as a place for watching movies, but also as a place for family outings. This is because of the fact that they offer a complete package which include movies, shopping, eating out, gaming parlours, etc. 8. 8. As a result, some of the traditional cinema hall operators have had to transform themselves into multiplexes. Moreover, seeing the lucrativeness of the business, many new players have joined the market. Indian cinema chains such asas INOX, SPI Cinemas, CineMAX, Adlabs, Satyam Cineplexes, etc. have also opened their screens all over India. Moreover, these multiplexes have grown through the lengths and breadths of our country, even making inroads into our tier-II and tier-III cities, which now account for about 70% of a film‟s total box-office collection. Today, Asia‟s largest multiplex stands at Chennai which is a 16-screen multiplex “Mayajaal””.. 3 9. Moreover, numerous international groups have also ventured into this business. Foreign entertainment giants like Time Warner and Megabox are in talks with Indian real estate developers such as DLF Group, Raheja Group, etc. to set up chains of multiplexes across the country. 10. As on today, multiplexes account for only 25% of the total number of screens in the country, with a low screen density of 8 screens per million in comparison with 117 per million in the US. However, in 2013, approximately 150-200 screens were added, with the major chunk of growth coming from expansion of multiplexes in tier-II and III cities. Hence, unlike the developed countries, there is a lot of scope in India to significantly increase the number of multiplexes without causing an over-supply of screens. PVR’s Market Performance 11. PVR Anupam changed the Indian movie-watching landscape. At present, PVR is India‟s largest cinema chain. Its geographically diverse cinema circuit presently, consists of 444 screens in 101 locations across 43 Indian cities. It includes having screens in Delhi, Faridabad, Gurgaon, Ludhiana, Jalandhar, Ghaziabad, Mumbai, Kolkata, Bangalore, Hyderabad, Chennai, Lucknow, Indore, Aurangabad, Allahabad, Ahmedabad, Udaipur, Chandigarh, Surat, Nagpur, Raipur, to name a few. Further, it plans to invest Rs. 250 crores to add 100 new screens in this financial year and has set a target of reaching 1,000 screens by the year 2017-18. One of PVR's most ambitious projects till date is the 15-screen 'Superplex' in Noida which is estimated to cost about Rs. 50 crores and it is expected to be operational by Mar 15. 12. At present, PVR Ltd. holds an impressive 25% of the market share. Its percentage of revenue share is about 20-22% in respect of Bollywood and 30-35% in respect of Hollywood box office collection. Other Ventures 13. In its years of operation, PVR has been the first to initiate many path-breaking innovations in the entertainment industry from launching the country‟s largest multiplex in Bangalore in 2004 to introducing “Gold Class Cinema”. In addition, the company also started operating other businesses through its subsidiaries, such as providing content, film distribution and opening entertainment zones. A brief outline of these subsidiary business ventures is as follows:- 4 (a) Distribution. Besides cinema exhibition, the company has been actively involved in film distribution. “PVR Pictures” is the film production and distribution arm of PVR Group. Since 2001, the company has distributed over 200 english movies, over 100 hindi movies and nearly 25 regional language movies. PVR Pictures film production debut came in the year 2007 with 'Taare Zameen Par' & 'Jaane Tu Ya Jaane Na'. Thereafter, it has distributed Hollywood films like „The Aviator ‟, „Mission: Impossible III‟, „Kill Bill‟ „The Hurt Locker ‟, „The Twilight Saga‟ and „Chicago‟ and Bollywood films, including blockbusters such as „Ghajini‟, „Golmaal Returns‟, „All The Best‟, „Don', „Sarkar Raj‟ and „Omkara‟.