Indian Cinema… Only for the Rich?
"It is shocking to see the government is classifying watching movies as luxury and subjecting us to the similar tax structure as of five-star hotels and casinos," said Nitin Sood, CFO of PVR yesterday when the government announced the GST rates on various products and services to be applicable from 1 st July this year. This made me wonder. My initial thought resonated that of Mr Sood as to how can anyone classify watching movies as a luxury? But then I took a step back and did a bit of number crunching. So, ladies and gentlemen, tighten your seat belts as what you are going to experience is shock albeit quite opposite to the shock experienced by Mr Sood. In India, any movie which grosses Rs 100 cr (USD 15 Mn) is considered a super hit. This makes sense considering the average revenue per film is an abysmal Rs 5-10 Cr (USD 1-1.5 Mn). Most of this is collected in the first week itself since unlike the days of yore when the success of the movies was defined by their ru