PVR plans India multiplex blitz

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SINGAPORE -- PVR Cinemas, the largest multiplex operator in India, is planning to nearly double the number of its cinema screens over the next 14 months by adding 70 to 80 screens to its existing 95 screens, company chairman and managing director Ajay Bijli said.

"We will be consolidating our position in existing markets like Delhi, Bombay and Bangalore, and at the same time entering new markets, like Chandigarh," Bijli told THR in an interview. The expansion plan will start with a five-screen multiplex in Chandigarh and a seven-screen multiplex in Bombay opening this first quarter, he added.

While the company is aggressively planning to open screens in north and south India in the near future, it also wants to strengthen its presence in west India and make new forays in east India, where the property and retail economy is up.

"There is still untapped potential in the bigger cities. They have different catchments, some developed and some under-developed. The suburbs are expanding, people are moving out of the central district areas, so there are a lot of suburban potentials within the big cities like Bombay, Delhi, Bangalore, Chennai, Calcutta," Bilji explained.

PVR Cinemas, which is widely acknowledged for having spearheaded the development of multiplexes in India in the late 1990s, currently operates 24 cinemas across 14 cities. Each new multiplex will have about five to six screens.

Bilji pointed out that his company was able to increase ticket prices by 15% during the current financial year (ending March 31), while the occupancy level of its cinemas averaged 45%, a figure he considered "very healthy."

Bilji also was enthusiastic about the prospects of PVR Talkies, which the company launched a year ago as a no-frills multiplex concept in smaller cities. These budget cinemas minimize investment on interior design: foyers are air-cooled rather than air conditioned and traditional paper posters are still used for promotion instead of display-plasma screens.

"We have nine operational now, but we will be taking this number up this year. About 20% of the planned new screens will be PVR Talkies," he said.

Bilji said he believes that despite increased competition in the market there has so far been no "cannibalization." Several of PVR's competitors have been reported in the local press to have expansion plans in India which are likely to double the number of existing multiplex screens to 700 by 2009.

"I'm OK with people coming in, because the market has to grow and as long as people are not building cinemas right next to each other I don't think they're cannibalizing each other. So far, the market is growing," Bilji said.
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