London-based international investment advisor and private equity firm DAR Capital Group (DGC) is all set to launch its film funding business this year. The fund, that would be in the region of Rs 150-200 crore, is expected to be launched in the first half of 2010, and will focus mainly on regional cinema.
According to a PricewaterhouseCoopers (PwC) study, the Indian film industry is projected to grow at a CAGR of 11.6 % over the next five years, touching Rs 18,500 crore in 2013, up from Rs 10, 700 crore in 2008.
Having invested around $250 million (around Rs 1165.5 crore) in areas like agriculture, real estate and infrastructure development in various projects worldwide, DGC, through its Mumbai-based subsidiary, DAR Media Pvt Ltd, will also be producing a minimum of 11 films by 2012, budgeted between Rs 15-20 crore each. The company aims to produce three films in 2010 and four films each in the next two years.
The company has already signed a three-film deal with filmmaker Mahesh Manjrekar and is also currently in the process of negotiating with at least two other filmmakers, for projects that will commence in 2010 and 2011.
Arun Rangachari, chairman, DAR Capital Group said, ?We are currently working on a film fund of Rs 150 – 200 crore, and the fund will have DAR as its anchor investor.? This fund will also include large chunk of non-Indian international investors coming in. ?The film fund is not just a natural progression of our content strategy of focusing on distinctive content, but our overall investment strategy of identifying and activating cutting-edge investment opportunities in emerging sectors and markets,? Rangachari added.
DAR will also invest in non-Hindi films?in Telugu, Bengali, Gujarati, Kannada, Malayalam, Marathi and Tamil. Says Rangachari says, ?By and large, the regional cinema market has been constrained in its growth. With the exception of Tamil and Telugu cinema, regional cinema has been suffering because producers want to focus on the more glamorous Hindi stream. Regional cinema not only has a better recovery model, but also involves a much lower investment risk,? he added
This year has seen a number of foreign investors and corporates investing in films, be it Indian or international. For instance, Eternal Mind Productions, a New York-based film production house, roped in Vishakapatnam-based Pavan Cargo Private Limited as co-producers for its forthcoming Rs 150-crore Hollywood film Mobster. According to sources, Eternal Mind Productions will be investing $6 million (Rs 28 crore) and the rest of the investment will come from the venture capitalists in the US and from collaborations from India. According to industry estimates, PE firms have invested approximately $180 million (Rs 839.16 crore) in the Indian entertainment sector in 2008 alone.