“Over 250 multiplexes in the country will close rather than accept what certainBollywood producers are proposing,” said Atul Goel, CEO, E-City, the Esselgroup company that operates Fun Cinemas, a 19-multiplex chain, and founder ofthe Multiplex Association of India, which represents the country’s leadingmultiplex chains.

The stand-off has already seen occupancy rates in multiplexes drop to 20per cent since April 4. This was after Bollywood producers decided not torelease new films until their demand for a flat 50 per cent revenue share wasmet.

However, Siddharth Roy Kapoor, CEO, UTV Motion Pictures, and spokesperson forthe Bollywood film producers, told Business Standard: “We have proposed a flat50:50 revenue sharing formula. They haven’t got back to us so far. We are opento what they have to say to our proposal but there is no going back on ourstand.”

However, the United Producers Forum, an association of leading Bollywoodproducers and production houses like Yash Raj Films, UTV and DharmaProductions, among others, have termed the demands from multiplex owners as“unfair”.

“We have a certain fixed cost that cannot be met from a flat 50:50revenue-sharing agreement,” said Goel of the Multiplex Association of India. Atypical multiplex has 160 to 200 seats. Occupancy level for a successfulBollywood film is 75 to 95 per cent. Analysts say the monthly fixed costs ofoperating a multiplex vary from Rs 40 lakh to Rs 50 lakh depending on size andlocation. “A multiplex has to generate monthly gross collections of Rs 1 croreto Rs 1.25 crore to cover fixed costs. The additional revenue comes from saleof food and beverage,” said a senior executive of a leading chain.

Signs of trouble for the film exhibition business are already evident since boxoffice collections from Bollywood films in March stood at about Rs 60 crore,the lowest in the last three years, said trade analysts. April collections areexpected to be at least 20 per cent lower than March.