Financial Daily from THE HINDU group of publications
Saturday, Jun 10, 2006
Financial Daily from THE HINDU group of publications Saturday, Jun 10, 2006 |
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Corporate
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Outlook Industry & Economy - Cinema Mid Valley plans to invest Rs 300 cr in movies, multiplexes K. Giriprakash
Bangalore , June 9 The Chennai-based Mid Valley Entertainment, a corporate entity that produces and distributes movies, plans to invest up to Rs 300 crore to make movies, buy cinema theatres, and set up television channels in the country. The Chairman, Mr K.K. Eswaran, told Business Line that the company will initially invest around Rs 100 crore over the next six months. "Most of the funds will be raised through internal resources and the rest through external funding," he added. The company is also understood to be in talks to buy a newspaper. According to him, Mid Valley is willing to part with 25-30 per cent equity to raise additional funds. "In another 36 months, we hope to have between 10-12 per cent of our total revenues as net profit every year," Mr Eswaran said. Before April 2007, the company will set up 50 theatres. The company has already taken on lease about 15 theatres each in Chennai and Hyderabad on long-term lease. "We take on lease standalone theatres on long lease and invest up to Rs 20 lakh to upgrade the facilities." Mr Eswaran said that the company is in talks with a UK-based Tamil language television channel for acquisition. "We are also planning to launch a Tamil music TV channel soon." Mid Valley also plans to produce 4-5 movies every year in Tamil, Telugu, English and Hindi. The company will put up multiplexes, shopping malls, and even hotels within the next 36 months in Chennai, Hyderabad, Delhi, and Bangalore. Citing an independent study, Mr Eswaran said that the Indian film industry is expected to grow to around $10 billion by the end of this decade. "Opportunities are huge here. It is much more than what it is in Hollywood." Mid Valley is funded by a clutch of investors from Malaysia and has so far produced eight Tamil films and over 500 episodes of Tamil television serials. It has also acquired overseas telecast rights of over 1,200 movies. Explaining the business model of the company, Mr Eswaran said that Mid Valley not only produces movies but also buys movies from independent producers and distributes them.
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