For many months, one of the biggest multiplex chains, Carnival Cinemas, has been in the news for the wrong reasons - from employees crying foul over unpaid dues to films being suddenly discontinued over financial reasons. Vishal Sawhney, CEO of Carnival Cinemas, in an exclusive interview to Bollywood Hungama, decided to open up on all the allegations being thrown at the multiplex group
Spider-Man: No Way Home's advance opened very late in Carnival Cinemas, on Wednesday, December 15, while it opened everywhere else on Sunday, December 12. Could you tell us the reason? Is it because Carnival couldn’t pay the advance?
Let us understand firstly that we have just come out of Covid-19 and restarted with Sooryavanshi. It’s not easy to have a portfolio of 400+ screens and to open all of them in one go. Fortunately or unfortunately, we are not an IPO company. We are a debt-funded company. Technically, it means that if I have to open 50 or 60 screens, it doesn’t take any time. But when you look at opening 400+ screens, it’s never easy.
Coming to your question, yes, the advance opened last minute. But it has neither happened before nor will it happen in future that Carnival will not play good content consciously or because of lack of money. Cinema is all about content and we survive on content. Therefore, I can’t have so many screens not playing content unless it’s a strategic call that’s being taken by Carnival where we do not want to run a movie in lieu of the other movies performing very well. Hence, I’ll put that to rest by clarifying that it was not about money for Sony. Even in the coming days, there’s a lot of content that we are going to play and there could be a lot of content that we would consciously not like to play.
Is ‘strategic call’ the reason that you didn’t release The Matrix Resurrections because other films are doing well at present?
Absolutely, yes. If I have a film like Spider-Man: No Way Home which is running so successfully day after day and I have a limitation with regards to the number of shows and films I can play, I think I’d leave it to my distribution and programming heads wherein they would assess what’s working really well. These are conscious calls that every business has to take.
Not just Spider-Man: No Way Home, other films, too, have faced issues. Tadap was discontinued from Week 2; Honsla Rakh was reportedly discontinued from Week 3. Sooryavanshi was removed from Carnival properties for a day…
Well, I wish that we had just 20 screens and then I would have played all the content possible. Fortunately, we are a big-sized multiplex chain spread across the country. And with so much regional content also coming in, there are times when these calls have to be taken by a group as to what is it that is getting played and how much is it getting played. With the best of our experiences, we might be taking some good calls but we might have also committed some mistakes. So this trend will continue.
How many of your screens are operational? When will the rest of the screens resume operations?
Our precise count is 480 screens. We are up and running 260 screens plus. As we talk today, I have another 14 screens that are being added on and which will run from December 24. Week on week, we are looking at restarting 22 to 26 screens.
What took time for certain screens to reopen? Was it the rent factor or something else?
There were certain locations where it became difficult, both from the developer perspective as well as from our perspective. Nevertheless, we have come to the tables (for discussions and negotiations). The very fact that we are 260 screens up and running and that we are able to restart around 22-26 screens every week proves that we are able to clean this up and move forward. Also, it’s not humanly possible that when cinemas are allowed to open, all of a sudden, 480 screens should be up and running. It can’t happen, where it’s in the cinema or FMCG business.
Is the ambitious 1000-screen-plan of Carnival still on? Is there any update in Carnival’s B & C centres expansion plan?
10% of our properties are in Tier-1 and Tier-2 cities. 90% of our portfolio lie in tier-3 and tier-4 places. Technically, that makes us the only company with cinemas in 128 locations. Before Covid-19, we had a screen count of 480 screens plus 124 screens which are already under construction. I wish that we wouldn’t have to face the crisis for those 20 months, like the rest of the world. Nevertheless, our strategy and vision don’t change at all though we have slowed down a little. We are hitting 1000 screens and we will. The only thing is that as per the milestone plan, we have postponed it further by 18 to 24 months.
Carnival runs one of the oldest IMAX screens, in Wadala, Mumbai. Will we see more IMAX cinemas being run by Carnival in near future?
Somehow, we do not see IMAX in our future plans in terms of cost perspectives and ROIs. And as I told you, 90% of our cinemas are in tier-3 and tier-4 cities (where it doesn’t make financial sense to build IMAX cinemas). Hence, we are not signing any deals with the IMAX US for an x number of screens at least for the next 24 months.
Also, would Carnival be interested in getting other kinds of formats like 4DX, Screen X, Gold-Class only screens etc?
We have a few locations which have a Gold Class which we call the ‘Red Carpet’. And those properties are doing fairly well. So yes, we do plan to increase the ‘Red Carpet’ screens though it comes under the 10% screens, located in the bigger cities. We are also looking at introducing say a kid's auditoriums in key strategic locations. 4DX is a technology that I have worked closely with as I was the one to get it into India. However, it’s not something we are looking at introducing in our multiplexes.
The properties of Inox, PVR and even Miraj and other such chains are getting renovated and look very swanky, even in smaller towns. A criticism about Carnival is that the properties deserve to get upgraded, on par with other multiplexes. Can we see that happening for the existing properties in near future?
Carnival has invested close to Rs. 80-85 crore for renovations. It further invested to get new screens. I could give you examples of certain locations, which are as swanky as it needs to be, and have the best of offerings. But from a mass cinema perspective, Carnival primarily focuses on four elements. One, clean auditoriums and comfortable seats. Two, a great sound and a projection system. Three, clean and hygienic washrooms and lastly, clean lobbies. We also focus on reasonable average ticket pricing and food offerings. We’d like to give a cinema experience to our patrons at the right price. But as aforementioned, these 10% of our locations are very swanky and compete with the properties of any other brand.
Off late, there have been reports that ex-employees and even current employees of Carnival have resorted to social media to vent about unpaid dues. Some of them claimed their F&F haven’t been cleared and also spoke about unprofessionalism. How do you respond to these allegations?
I have not seen any company in my last 18 to 20 years of my work experience where employees are not happy about something or the other. Some of them would have a voice while some won’t. Out of 3000 odd employees, if I have around 10-15 people who are not happy, without getting into any debate, I’d just like to say that I am sorry. Maybe there is something which the company did that they are not happy about. However, I would like to focus on the 99% of employees who have been with us for years, some of them 7-8 years, and continue to be with us.
As per Mint, Carnival is in the advanced stages of locking in a strategic alliance with a private equity investor that will help resolve its debt crisis. Could you share the details?
(Laughs) I’ll let you know as soon as I know! Carnival, till today, is 100% owned by its chairman. In the coming times and very soon, there are going to be some strategic alliances. 490 screens are one of the biggest valuations that happen in a market that we are aware of. So, not one but there could be many strategic alliances moving forward. The perspective remains the same – move towards the goal of having 1000 screens and at the same revive from the effects of the pandemic.
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