Availability of OTTs does not mean that people will not come to theatres, cinema is here to stay: Alok Tandon, CEO, Inox Leisure

Alok Tandon, CEO, Inox Leisure Ltd, talks about the trends and footfalls in theatres, plans to go profitable again, private screening facility, upcoming releases, expansion plans, OTT platforms and outlook of the company going forward among others during an exclusive interview with Swati Khandelwal, Zee Business. Edited Excerpts: 

Q: Your industry has been the most beaten sector in the COVID. But as we open up now, how are you seeing the trends and footfalls? Do you think that the demand is back in full swing?

A: I would say, 'Yes' demand is back in full swing. People are desperate to come out. I would like to inform you that when Maharashtra Government announced that the cinema halls will open from October 22, 2021, the happiness was just not restricted to the film industry or the exhibitors but it also happened among our staff and their families because we all know that Hindi pictures are not release in India until Maharashtra is not opened. You can see that Hindi pictures runs are a lot in West, Centre and North India. So, I would like to say that it is a good thing that the Maharashtra government has allowed. The second matter of happiness is that within 24 hours of the Maharashtra government allowing us to operate there were about 20 movies which the production houses said that now they will come out and the dates were announced. So, it is good for the entire industry that cinemas have opened up. Today, when I am talking with you, every state in India has allowed us to operate. 

Q: Though it would not be right to compare the last quarter numbers with current ones, what is the outlook and what the future is looking like? Of course, profitability took a huge beating and was visible in the numbers. How will you correct it and ensure that the company gets up and rise on its feet and become profitable again? 

A: First of all, we are supposed to win the confidence of our guests and we will win back the confidence of the guests by following all the safety protocols. So, everyone will be in masks, social distancing will be maintained and all of our associates will be wearing face masks and ladies with hay necks so that all things are followed. We will ensure that the interval of any picture and entry and exit are not clashing with it other to avoid the crowd. So, the first thing for us is to win back the confidence of our guests. In addition to this, by now, each of us is aware of what should be done because post-Unlock-I, we followed all the protocols due to which our entire staff knows it and the guest also knows that what should be done while being at cinema halls. This is quite beneficial. As far as recovery is concerned and by when it will be attained, if a good film comes then naturally, people will get back. Post that, we will continue to follow the safety protocols that we have been doing. Secondly, to bring recovery, we have started private screening, i.e., if you come here with your family or friends and you do not want to sit with people you don't know then you can book the entire hall from us. This is also something that we have done. 

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Q: How has been the response for this facility? 

A: So far there has been a very good response and thousands have come to date. In fact, there has been a tremendous response, since the launch of the private viewing. Secondly, what are we doing for recovery or to stand on our feet is that the days when we do not have pictures and content are not available, we are using the cinemas for a lot of alternate content also. We did it in the past as well before the pre-lockdown. But after the lockdown, when we reopened it, we emphasised more to show the non-cinema content, publicise it more and market it. So, all those things we are doing. For example, T20 World Cup is going on at present, so, we are showing live matches. Before COVID, we used to show music concerts, BTS on our screens. We used the theatres for EGMs, parent-teacher meetings. Currently, the schools are shut but when the schools were open, what we used to do is that we have a complete bouquet of Nat Geo discovery films, documentaries and we used to bring children to our theatre and made them see these films. So, the film is primarily a source of income but we have also seen that a lot of non-cinema things can happen in our cinema halls to get revenue. 

Q: How the upcoming releases are looking and what is in the pipeline for November and December? Also, how this year is panning out? 

A: Very exciting. I can rattle out one name after the other whether it is English, Hindi or any other Indian language. The films that are running at present are Bond and Dune, i.e. doing amazing business. Earlier, we had Shang-Chi and it did well. Bell Bottom released about a month back did very well in cinema halls. So, nothing to complain about, it did very well. Come November, we will be having Sooryavanshi, Eternity and Bunty Aur Babli 2, i.e., one after another, pictures are available, there is an exciting pipeline. November, December and January, I would say that every Friday would be a challenge for a consumer to decide the first picture that they should see because they will see each one of them but they will have to choose the first that should be seen. So, there is a good pipeline as well as the content. 

Q: Currently, the company operates 658 screens across 70 cities in India with an aggregate seating capacity of around 1.49 lakhs. Is there any plan to increase it?

A: I have always said that we have always been in a growth stage. For the last 20 years and even today, we have been making cinemas and expanding and there will be no halt in it. Our expansion strategies are in place, the only thing that happened is that it slowed a bit last year and this year and it is natural. To date, we have been expanding and launching new properties. Last year and this, it slowed a bit. 

Q: How do you see OTT as a competitor now and how will you tackle the competition in the future?

A: A debate has been going for a long time that OTT and Cinema are affecting each other or OTT is impacting the cinema. 

Q: But it is happening and it is visible in the numbers?

A: No, it is not so. I would like to have a different view on this. Have a look at the number of pictures that are released in India around 1,900-2,000 unique titles are released every year in India - this is across all languages and zones. At Inox in FY20 - because that is the year when everything was fine - we showed about 1,100 unique titles. Yes, a few films moved to OTT last year because all the cinemas were shut and I don't blame them, it was a stress on their balance sheet of the filmmakers, who moved to OTT. Hence, the picture came on OTT. Even now, a few movies have gone on OTT but that does not mean that people will not come to theatres or will stop coming here. 

Q: From where would you raise the funds? Also, what will be your outlook on making profits at some point and what kind of margins or profitability you will be able to see? 

A: Inox's balance sheet is quite robust, I would say - the best in the industry. We are a net debt-free company. I would say that at times people say that you are running such a big operation with such a huge presence and are also expanding every year but you are a net debt company. I say that we are cost-conscious, there is a saying in Hindi, ' उतना पैर फैलाना चाहिए जितना चादर हो' (limit your expenses according to your earnings) and we are doing the same at our company. The problems that we saw in the last 18 months, we had a treasury stock, which was sold, after that we did a QIP, so the stake was diluted but yet we have a very strong balance sheet, strong promoter holding, our cash reserves are good, which can sustain us for a few more months. The biggest asset, which I have is that we own six of our properties and our corporate office. So, if I value that that is Rs 400 crore. So, we today and always have been a company, which has always had a great balance sheet and that is our biggest strength. It is our daily focus and we have a fine-tooth comb look at our expenses so that we earn money and at the same time, we are very careful about our expenses. 

Q: What is your outlook for the next year in terms of the top line, bottom line, and margin? 

A: I will not be able to tell the numbers at present but let me tell you that we are very excited for the next financial year and why the next financial year, H2 of this financial year also. Good pictures are coming, people are coming back and the kind of footfalls we have seen after Maharashtra was open in the last couple of days is very very heartening to know that. People want to watch the movie on giant screens, they want to see their heroes on a giant screen, they want to see films with uncompressed sounds and crystal clear images and the place, where we are Metro Inox. The way we have made our properties is something that we want to decouch our patrons and bring them here and we are doing so and it will continue to happen in the future also. The numbers will rise.