From being allowed to operate at 100 percent in February to shutting shop from April 14 onwards, Indian cinemas are struggling with uncertainty once again.

With theatres likely to remain shut until May 15 in most parts of the country, the picture is grim for the entire film industry which bets big on theatrical revenue that forms a major part of a film’s earnings.

According to analyst Karan Taurani, who closely tracks the media and entertainment space and is Vice-President, Elara Capital, first half of this year will be a write-off and the recovery is expected from September onwards.

“Now, instead of 25-30 percent decline which was estimated on the back of 2021 being a good year for the film business, it will be 60-70 percent decline versus the pre-COVID-19 period,” he said.

Box office collections of 2021 releases like south superstar Vijay’s Master and Hollywood venture Godzilla vs Kong gave strong hopes of recovery. While Master registered a lifetime collection of over Rs 200 crore worldwide, Godzilla vs Kong minted around Rs 46 crore in India.

In addition to box office successes, the movie calendar looked strong with Yash Raj Films (YRF) announcing release dates of five tentpole films. Other film studios and producers followed suit and announced release dates of ventures like Ranveer Singh-starrer 83, John Abraham-starrer Satyameva Jayate 2, among others.

But, now the movie calendar has gone for a toss.

“All release dates are going to be postponed indefinitely and there will be a fresh calendar unfolding,” said Taurani.

Bollywood in a bind

While the entire film industry is taking a beating due to the spike in COVID-19 cases, the impact on Hindi films or Bollywood will be more.

This is because Bollywood delayed releases despite theatres being allowed to reopen since October 2020.

“During January-March , when theatres opened up, and many big films were releasing in Tamil, Telugu and Kannada, Bollywood did not release any films, hoping for the scenario to get better. So, there was no revenue to speak of, except Roohi and Mumbai Saga. The total collections of all Hindi films in 2021 so far are just about Rs 50 crore,” Shailesh Kapoor, CEO, Ormax Media, a media consulting firm, told Moneycontrol.

He further said, “With the more severe second wave now, it will take a few more weeks, if not months, for big films to release in Hindi. In Tamil and Telugu, a producer has to worry about the COVID situation in only one state. But in Hindi, a producer has to worry about the national market. No film can have a proper release if theatres are not running in a big market like Maharashtra or Delhi.”

For Bollywood, Girish Johar – producer and film business expert – estimates around Rs 3,000 to Rs 4,000 crore loss in 2021.

This is a big blow to the Indian film industry because Hindi films contribute 43 percent of the overall box office revenues, according to an EY 2020 report.

Furthermore, not much is expected from overseas markets this year as well.

Johar believes Bollywood will not see strong traction because it isn’t offering big films.

While Taurani thinks that international markets will be a differential factor in 2021, he said that currently movie going is restrictive in many countries. “So, even overseas, the collections will be 40-50 percent down versus pre-COVID-19 despite it (Radhe) being a large film outing.”

Salman Khan-starrer Radhe, which is the first big budget Bollywood venture releasing in international markets in 2021, is scheduled to release on May 13. The film will simultaneously release in theatres worldwide as well as on over the top (OTT) platform ZEE5 with Zee Plex, the pay per view platform.

Direct to digital releases a concern

With theatres likely to remain shut in major markets till May 15, release of Radhe will be a non-event for cinemas, making the film another direct to digital release.

After Radhe, Taurani expects one more large film to go to OTT directly.

“The issue will be about being able to get the right price. All OTT platforms do not want to pay a premium for theatrical films, and producers may expect prices to match their expected theatrical revenues in a pre-COVID scenario. So, negotiations may not go through for all big films.”

While producers of Radhe, Salman Khan Films (SKF) have got a viable deal with ZEE5 paying over Rs 200 crore, said Johar, it is unlikely for all big films to strike such deals, the experts said.

“OTTs have a limited budget. They have made bad decisions in the past year. So, they are being selective. Producers who want to go to OTT want a premium. So, it is difficult to go to OTT as well,” added Johar.

While big films may wait for a theatrical release, Kapoor said that medium-scale films will definitely make it directly to OTT. “One can expect about 10-15 such Hindi films on OTT in the next three to four months.”