Kanakia Group-owned exhibition theatre chain, Cinemax India plans to invest Rs 150 crore for a phased expansion by financial year 2012-13. Its CEO, Sunil Punjabi, talks to Sohini Mitter about Cinemax?s expansion plans, focus regions, growth targets, box-office expectations and innovative strategies for enhancing cine-goers? experience. Excerpts:

What are the expansion plans the company has in the pipeline?

We have 105 screens in 33 locations covering 19 cities. We will invest Rs 150 crore to double that to 200 screens by FY13. In the first phase, 35 screens will come up in 3-4 months, with a focus in western and southern India. We?ve identified lucrative catchment areas in Nashik, Ahmedabad, Hyderabad and Bangalore, and plan to saturate them. In the south, there?s increased availability and high consumption of regional language content that makes it profitable for multiplex operators to screen local films in a sustained manner. We?re looking at those areas where people?s propensity to spend is higher.

Cinemax has had a prolonged concentration in the west, especially in Maharashtra. Why so?

When we started out, our focus was on the Bombay film territory, which is the traditional hub for cinema in India. If you look at the graphical distribution of revenues, 40% of Bollywood?s theatrical revenue comes from Mumbai.

Besides, we have better developer relations in the west by virtue of being a Kanakia Group company. We have 59 screens in 19 properties in Maharashtra. Every operator wants consolidation in his own territory. PVR had the first-mover advantage in the north and they captured the market. Inox did the same in Calcutta and the east. Cinemax has dominated the west, while south is a fragmented territory with a presence of all major operators.

What has been your growth this fiscal? What are your targets for FY11-12?

We recorded a 25% growth in revenues in FY11 vis-a-vis FY10. We expect to grow at 25-30% next fiscal. The company is targeting a turnover of Rs 240 crore in FY11 and Rs 380 crore in FY12. We look to introduce innovations in the food and beverage segments which contribute to 22% of our revenues. Providing consumer gratification is our main target.

How have year-end collections been at the multiplexes? What are the expectations from 2011?

There?s a complete calendar of events which drive people to cinema halls. Four to five movies either make or break every quarter. The third quarter which corresponds with the year-end is normally good but 2010 was disappointing. Tees Maar Khan gave a fillip but couldn?t carry on beyond a week. 2011 is opening with lot of buzz surrounding No One Killed Jessica. Also, 22 3D films will hit the screens this year. We?re pinning our hopes on them, as 3D films witness a 15% rise in ARPU.

How will the multiplex business shape up in the coming years?

The trend in the multiplex business is that the big are just getting bigger. The coming years will see more consolidation from the major operators. Strategic acquisitions of smaller chains and standalone multiplexes that have 25 or less screens are likely to be seen.