The India story at this year's Oscars was Dune's win in the visual effects category. The Namit Malhotra-led DNEG, which is a subsidiary of Mumbai-based Prime Focus, created the visual effects for the film.
DNEG, which had two nominations in the 94th Academy Awards, including No Time To Die, has so far won six Oscars, five of them in the last seven years. Malhotra says that every film the company has worked on and projects that have won an Oscar have contributions from India and Indian artistes in various levels of complexity. "Indian talent and scale of potential is growing rapidly. The more our artistes shine, the more the world will recognise us," he said.
London-based DNEG, which was acquired by Prime Focus in 2014, raised Rs 3,000 crore in February and will soon be listed on the NASDAQ exchange with a valuation of $1.7 billion. Malhotra said that the funds will be used to increase investments in technology, expand newer business such as gaming, and hire additional talent.
The company has recruitment plans for India as well, he added. "We will be increasing the headcount by 2,000 people in India in the next 12-18 months," said Malhotra.
He added that the visual effects and animation industry is poised for massive growth. "Entertainment services, especially animation and VFX, are going to take centre-stage and Indian artistes and talent are becoming relevant world over. There will be a marked increase in that capability."
The VFX sector's revenue, which grew over 10 percent in 2021, is estimated to increase to Rs 58.7 billion in 2022 from Rs 38.2 billion in 2021, says a FICCI EY report. The growth is projected to be driven by increased demand for higher-quality domestic film and episodic content, wider adoption of virtual production, a hike in VFX budgets for content, and increased offshoring of projects to India as the global content economy expands with new OTT platforms, said the FICCI EY 2022 report.
In addition, the Indian government's implementation of the AVGC (animation, visual effects, gaming and comics) policy will be critical for the sector. In her Budget 2022 speech, Finance Minister Nirmala Sitharaman announced that the AVGC sector will set up a promotion task force to employ youth and build domestic capacity to serve Indian markets and global demand.
When it comes to Prime Focus, Malhotra is also expecting strong growth in business in FY22.
"The March quarter is our strongest so, hopefully we will see substantial growth versus last year," he said. The company expects to clock in around Rs 3,042 crore in FY22, up from Rs 2,536 crore in FY21.
Prime Focus has 20-30 projects in the pipeline in 2022 and some of the current and upcoming projects include Uncharted, Death on the Nile, Moonfall, Borderlands, Stranger Things season 4, Aquaman and the Lost Kingdom, Knives Out 2, The Last of Us, The Flash, and Shazam! Fury of the Gods, which will hit theaters next year.
He said that while 2021 was a bit of an odd year due to the pandemic and starting and stopping of production, the project load has gone up exponentially. "We are looking at the busiest time in our history," said Malhotra.
Prime Focus, which has worked on recently released ventures such as RRR and Alia Bhatt-starrer Gangubai Kathiawadi, continues to focus on India. "We were trying to build our base in the West, which we have done. We have a decent mix of projects from India and Hollywood."
However, India contributes just 5-10 percent of the company's revenues as the market, while high in terms of volume, is lower in value. But spending on VFX appears to be increasing even for Indian projects. From 5-8 percent of a show’s production budget, VFX has now increased to 15-20 percent of the production budget of films, shows or series.
Betting big on the country, Malhotra said that while India has a film history of over 100 years, it has not got its due.
"Indian filmmakers have not been appreciated for their talent. But now the perseverance to put India on the map has started to play out. When I went to Hollywood, they were like, 'We don't trust India, we can't work with India'. Today, India is becoming the fundamental foundation of most big projects," said Malhotra.