What is a 100 crore club?

Published On: June 19, 2013   |   Posted By:

 100 crore club

The Indian film industry has just completed 100 years on may 3rd 2013. During this time around 15,000 movies were made in all the regional languages across India. However, with the advent of time, making of a movie, production values, cost viability and overall scenario have changed drastically. Till the early 90’s before the inception of technology, cable TV and western influence changed our way of life style, we were into making modest, family-oriented, run of a mill cinema.

Over the past ten years, film production giants like yash raj films, dharma productions, UTV motion pictures and Reliance have brought in the culture of corporation and a methodical studio system. The planning and efficiency of these giant corporate is so perfect that they chart out the budgets, number of shooting days, post production, marketing and even the release date to the T.

However, with this kind of western essence, corporations, planning you have to get professionals who execute them to the T. With this advent the remunerations would shoot up.

A top ten actor budget in Bollywood is in the range of 60-80 crores including advertising. In order to retrieve the amounts back the production houses have to plan in such a way where they could recover the expenses at a faster rate. During the olden days the producers used to release the movie at one theater per town, however, with the huge budgeting costs now the producers are forced to release in more theaters per town in order to recover sooner.

In a state like Andhra Pradesh is divided into three regions of Nizam, Ceded and Andhra and consists of 1600 single screen theaters across the state. If a movie budget for a top actor is in the range of 40 crores the producers strategies a formula where in 35% of the investment is recovered from Nizam, which is considered as the heart of the state. For that to happen the movie needs to occupy at least 300 screens over a period of one week, that’s around 8400 shows per week. The producer as to anticipate that 70% of the theater will occupied throughout the week in order for him to recover costs.

So, when you hear nowadays the talk about 100 crore club, we have to understand the following-

1) Cost of production

2) No of theaters in which the movie is released

3) Whether the collections of more than 100 crores are after deduction of theatre rentals and taxation applicable.

4) The ratio of Expenditure v ROI is at least 1:1.

We can always get carried away with this norm of 100 crore club, but the point has to be at the end of the day is the producer making more money than what he has invested. So, the theory of 100 crore club has to be considered with a pinch of salt.