A VC's Analysis of the 2018 Box Office Results

The Indian Television industry is undergoing a massive change. Except for Shark Tank & Suits that are available on Indian TV, the best content is now being displayed on platforms like Netflix, Amazon Prime, Voot etc. These platforms are providing writers, directors, actors, producers, etc. the freedom to create or participate in content that they are inspired by. Recently, many bankable movie stars have done Netflix/Amazon Prime shows; Saif Ali Khan, R Madhavan, Nawazuddin Siddiqui, Radhika Apte, Bhumi Pednekar to name a few. These avenues give talented character artists that are confined to supporting roles in mainstream Bollywood movies the chance to get meaty roles and display their talents in Netflix/Amazon original series. The stellar success of these web series indicate a change in the preferences of the viewing audience and it got me thinking if this applies to the big screen as well.   

This morning I looked up the Bollywood movies that did well at the box office in the year 2018. Although there is a lack of information on the financial performance of Indian movies, a quick search revealed this imdb post to be the best source of aggregated information for the box office performance. Despite the math in this post is off, I found most of the numbers to be believable. I cleaned up the list to remove non-hindimovies and removed Hichki as the numbers didn’t add up (and I didn’t quite believethem). I was unable to find a credible source to cross verify the worldwide collections data, but for now, we’ll rely on this. Below are the top 20 grossers for 2018:

Rank Name Domestic Worldwide Total Budget
1 Sanju 340 234 574 100
2 Padmaavat 293 224 517 190
3 Race 3 166 121 287 150
4 Baaghi 2 161 100 261 65
5 Simmba* 151 99 249 75
7 Badhaai Ho 136 90 226 30
6 Thugs of Hindustan 130 96 226 275
8 Stree 128 74 202 20
9 Raazi 121 77 198 30
10 Zero 96 73 169 200
11 Gold 105 60 165 85
12 Sonu Ke Titu Ki Sweety 102 59 161 15
13 Raid 100 59 159 35
14 Veere Di Wedding 80 56 136 20
15 Sui Dhaaga: Made in India 79 50 129 30
16 Padman 75 47 122 30
17 Dhadak  75 47 122 25
18 Satyameva Jayate  78 44 122 50
19 Andhadhun  73 47 120 25
20 Parmanu: The Story of Pokhran 64 37 101 30

This list does not provide an accurate picture as to the profitability of the movies, therefore, I added a column for the movie budget sourced from the same post. Then, I divided the total collections by the budget to come up with the total X’s the movies made. This derived data tells a whole new story.

New Rank Previous Rank Name Domestic Worldwide Total Budget Returns
1 12 Sonu Ke Titu Ki Sweety 102 59 161 15 10.73
2 8 Stree 128 74 202 20 10.10
3 7 Badhaai Ho 136 90 226 30 7.54
4 14 Veere Di Wedding 80 56 136 20 6.78
5 9 Raazi 121 77 198 30 6.61
6 1 Sanju 340 234 574 100 5.74
7 17 Dhadak  75 47 122 25 4.87
8 19 Andhadhun  73 47 120 25 4.79
9 13 Raid 100 59 159 35 4.55
10 15 Sui Dhaaga: Made in India 79 50 129 30 4.28
11 16 Padman 75 47 122 30 4.06
12 4 Baaghi 2 161 100 261 65 4.02
13 20 Parmanu: The Story of Pokhran 64 37 101 30 3.36
14 5 Simmba* 151 99 249 75 3.32
15 2 Padmaavat 293 224 517 190 2.72
16 18 Satyameva Jayate  78 44 122 50 2.43
17 11 Gold 105 60 165 85 1.94
18 3 Race 3 166 121 287 150 1.91
19 10 Zero 96 73 169 200 0.85
20 6 Thugs of Hindostan 130 96 226 275 0.82

Here are my insights from the second list:

  • A big budget does not equate to big success
    • 9 out of top 10 profitable movies had a budget under 50 crores
    • 12 movies with a budget of less than 50 crores returned 5.28x of budget
      • 1797 crores on a 340 crore budget
    • In contrast, the top 5 budgeted movies returned 1.94x of budget
      • 1773 crores on a 915 crore budget
  • Female actors’ rule!
    • 4 out of the top 5 profitable movies were based on strong female lead(s) characters
  • The end of the Khan rule?
    • They took up 42% of the budget (of the top 20) but contributed only 16% of the revenues
    • Collectively the Khan’s returned 1.09x of budget

This entire exercise reminded me to continue to pick entrepreneurs/ partners/ employees based on their ability to perform and not the weight of the names on their resumes. Secondly, it reinforced my belief that picking dark horses, keeping low budgets and focussing on quality is the key to investment success – in both movies and venture investing.

6/2019

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2 Comments

  1. If “female actors rule”, why are your top 5 “profit making stars for producers” all male?

    • The method to choose the top 5 profit making actors was based on how many times the actor featured on the top 20 list.
      Except Radhika Apte none of actresses were seen twice in a top 20 feature.
      However the women-led movies did make it to the top 5 based on profitability


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