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New movies to bring in revenue worth 0.7 crore for Zee

05-October-2002
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New movies to bring in revenue worth 0.7 crore for Zee

Zee Telefilms’ new strategy to premiere new movies is expected to bring in an average operating profit of Rs 0.7 crore per movie from the first telecast. The company is learnt to have already roped in 8-9 sponsors for the first 16 movies telecasts, each of which is expected to spend Rs 0.2-0.3 crore per movie.

This takes the revenue potential from each movie screening to Rs 2.3 to Rs 2.7 crore, depending on the movie.

The new movies will be screened once a week on Thursdays at prime time slot of 8 pm. The channel has bagged rights for films such as Om Jai Jagdish, Legend of Bhagat Singh, Humraaz, Mere Yaar Ki Shaadi and Mujhse Dosti Karoge to name a few and all of which are less than six months old.

According a recent report by Motilal Oswal’s ‘Inquire Equity Research’, the economics of movies on Zee TV is expected to work out favourably for Zee TV.

According to analysts, considering that movie acquisition costs are close to three-year lows, which makes the cost of acquiring movies very attractive at this point in time, it is understood that these new films have been acquired at a cost ranging between Rs 0.7 crore and Rs 2.1 crore. Therefore, the average cost across all these 26 movies on a conservative cost estimation is about Rs 1.7 crore.

Going by this, analysts say that this leaves Zee with an average operating profit of Rs 0.7 crore per movie from the first telecast, an operating margin of 28 per cent only considering ad revenues and film acquisitions. Analysts say that movies was the only real option for Zee to turn the viewership tide in its favour.

The movies are expected to bring in large number of audiences to the channel that would be led into the soaps on Zee. Media buyers feel that these movies will log minimum television rating points of between 3-5 per film.

This would make these movies the top programmes on Zee and would also ensure a place for Zee TV in the weekly top 50 programmes on the Hindi cable and satellite channels.

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