Move over McDonald’s. Movie halls are the new anchors at malls. Average spends at multiplexes might be smaller than those at apparel stores or hypermarkets, but they’re consistent and more predictable. Which is why cinema chains like INOX, PVR Cinemas, Cinepolis and Carnival are willing to rough it out even in a not-so-happening mall or stay put in a near-vacant one if they can’t find space in a top mall. Indeed, shopping at malls today is no longer top priority. “Earlier, people came to a mall mainly to shop and then perhaps get a meal or catch a movie but that order seems to be reversing,” said Mukesh Kumar, vice-president at Infiniti Mall.
The share of space that multiplexes and the F&B category occupy in malls has increased from just 8-9% a couple of years ago to 20%, according to a Knight Frank India report. In some of the newer malls such as DLF Mall of India in Noida and GVK One in Hyderabad, this category has taken up as much as 40-50% space. Icra expects the number of multiplex screens to cross 3,000 by 2019, backed by an increasing number of malls and a rising penchant for movie watching.
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In fact, the demand for entertainment is so high that Pankaj Renjhen, managing director, retail services at JLL, believes a multiplex can survive even if it’s not inside a mall but if there’s a sufficiently large catchment. PVR Cinemas, for instance, chose not to move out of a mall in Pune that was being converted into an office complex. INOX has set up a theatre in Atria, a mall located in south Mumbai, which has been half empty for nearly four years now and without an anchor tenant. It is also present in CR2, located in Mumbai’s business district of Nariman Point, which isn’t the bustling mall it used to be three years back.
A 2016 report by Icra said multiplex screens in India have grown at a compounded 13.5% between 2009 and 2016. The sector has also seen a fair bit of consolidation over this time with seven major acquisitions, valued at Rs 2,500 crore. Despite this, the penetration of screens remains low at six per million people, leaving room for more theatres.
According to Shubham Jain, vice-president of corporate ratings at Icra, exhibition chains like PVR and INOX are capable of driving footfalls, which is why mall owners will woo them with competitive rates. That’s a win-win situation for both players. For their part, multiplexes would prefer to stay put in a mall, Renjhen explained.
