CHENNAI: When news got around that multiplex giant PVR cinemas was attempting to buy out the city's home-grown theatre chain SPI Cinemas (or Sathyam as people still call it), there was an outpouring of emotion from cinema lovers.
It never came to pass. And with two unopened properties in the suburbs, PVR has found the city a little harder to conquer than India's other metros, "Chennai is a tough market," admits PVR Chairman Ajay Bijli, a man who has commandeered the theatre business is more cities and towns than anyone else.
Even he has been worried about the state mandated price cap of Rs 120 per ticket, "Everybody who does cinema in Tamil Nadu does it with the hope that the pricing cap, even if it's not removed, will increase with inflation," he states.
Despite the SPI deal falling through over financial differences, PVR doesn't seem overtly concerned, "The beauty of the Chennai market is that it is still very fertile for us," says Gautam Dutta, PVR's Chief Executive Officer.
Speaking a little after they inked a deal with Dolby Labs to have Atmos installed in 50 of their screens, Dutta says they've switched to Plan B now, "There was some dialogue with SPI but that fell through. We'll take our time and wait and build better cinemas. We will always want to be in prime areas but every city has a prime player and in this case it is SPI Cinemas. Agreed, they have a few prime locations but we believe that we don't need to break the market. We have a plan B and for Chennai we're working with it to see how we can grow."
Growth is the key here. Compared to SPI Cinemas who expanded from the flagship Royapettah multiplex to multi screen plexes at Express Avenue, Spectrum Mall, Phoenix Marketcity and Forum Vijaya Mall, PVR has not managed to get their multiplexes at Velachery's Grand Mall and the new site in Pallavaram opened, "Policy, real estate growth, retail growth all of these factors are holding us back. If there are good shopping centres and malls coming up we will be there. We have 7 screens operational at Ampa Skywalk and another 10 screens in fit out," says Bijli.
Much like SPI Cinemas' IMAX screens and Palazzo yet to be opened over a year after they were ready, PVR's Velachery property is also gathering dust - because the operating permits and licenses are stuck in limbo, "We're waiting for licenses to come through and that is taking some time. We are constantly calling the government and trying to push things through and hopefully something should happen by the next elections in 2016," reveals Dutta.
One of the reasons why they're still optimistic about the Chennai market despite the low ticket cost (most metros charge up to four times this amount for a weekend release) is the movie crazy audience, "The pricing is an issue but the volumes are very high. Year on year the occupancy is as high as 70-80 percent. Though Ampa is not in a great place it is doing extremely well. Also, Coimbatore is a market we're getting into very soon."