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COVID-19: Malls, multiplexes and restaurants stare at losses of up to Rs 20 crores per week

Fear of contracting the virus had already slowed down social activities with the entire industry staring at massive losses.

Published: 15th March 2020 12:25 AM  |   Last Updated: 15th March 2020 12:25 AM   |  A+A-

Coronavirus

People wearing masks as a precautionary measure to avoid coronavirus. (Photo | EPS)

Express News Service

In the face of an impending health crisis caused due to the infectious coronavirus (COVID-19), a host of Indian states have shut down malls, cinemas and restaurants at least till the end of March. The two-week closure is set to affect not just the retail industry, but also related industries like film and food and beverage outlets. Fear of contracting the virus had already slowed down social activities with the entire industry staring at massive losses.

“The order of closure of malls and multiplexes across cities by the respective state governments to prevent people congregating for any reason, has caused the organised retail scene in these cities to come to a grinding halt,” said Anuj Kejriwal, MD & CEO – ANAROCK Retail.

The top eight cities have 126 malls and more than 100 malls have multiplexes. “Shutting them down can be a major step forward in terms of harm-prevention but economically, the short-term closures will have significant financial implications,” he added.

Karnataka and Delhi -- the two states that have reported deaths caused due to the deadly virus so far -- were among the first to press the emergency button and announce an overall shutdown.

In Delhi-NCR, for instance, there are 33 malls which have 18 multiplexes. Overall, there are over 150 theatres in the national capital. Even as OTT, or streaming platforms such as Netflix and Amazon Prime, were weaning away cine-goers, theatre attendance stands at around 2,000 on weekdays with the number touching 3,500 on a weekend.

The number could be even more if a popular movie is being screened, according to an entertainment industry tracker. This translates into roughly a lakh people seeing movies in the city’s multiplexes every day and spending on average Rs 500 per person for tickets and snacks.

Going to a movie also includes parking cost, fuel cost and taxes on movie tickets and food. “Entertainment, especially movies, is a big revenue and economic contributor but all these earnings will come to a standstill now,” said Amit Sharma, MD of Miraj Cinemas, which has 128 screens across India.

The industry stares at a loss of up to Rs. 20 crores per week, Sharma added. Notably, movie halls were already counting their losses with many movie releases such as Akshay Kumar-starrer 'Sooryavanshi' being postponed amid the coronavirus scare.

Eateries are also seeing a decrease in dine-in sales, according to executives at Westlife Development, which runs McDonald's stores in the south and west India. Industry body National Restaurant Association of India (NRAI) said it will seek relief on rents, energy costs, overall credit limits and taxation, as malls and restaurants have registered a 30-35 per cent decline in footfalls. 

"We will be writing to certain government bodies to seek interim relief," said Anurag Katriar, president of the association, which represents the interests of over five lakh small and big restaurants.

"The biggest fear is though unemployment," he said, explaining that since the industry works on a fairly high operational cost, a prolonged crisis could result in closures of a handful of businesses.

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