PVR opens door to luxury movie experience

In this MB Inspired series we have a guest how has started his career in movie business by refurbishing a family-owned cinema and then went on to spread his multiplex chain all over India. The man in focus today is Ajay Bijli, CMD, PVR Cinemas.

Ajay pioneered the multiplex chain in India by setting up the first multiplex in 1997. As CMD of PVR Cinemas he is instrumental in identifying important business initiatives and strategic opportunities for PVR. Below is the edited transcript of his interview to CNBC-TV18. Also watch the accompanying video. Q: Tell me about this luxurious theatre?
A: This was opened about 4-5 months ago. PVRs philosophy has been a movie solution for every movie goers, a cinema solution. We have PVR Talkies, PVR Cinemas and PVR Premiere. These are all different offerings at different price points.
But, we wanted to catch a niche segment which was comfortable with their hi-tech home theatre systems at their homes or farm houses in Vasant Vihar, Shanti Niketan, the upmarket area of Delhi and were reluctant to come out to watch a movie in theatre. So, the challenge was how do we get them out of their homes? Therefore, we created something which was very luxurious. No compromise on seating configuration, comfort, service on seats. So, it’s a blend of a hospitality plus cinema experience. Q: Is it the only one in the country right now?
A: Currently, this is the only one and we are taking this to few more cities, one has to be very careful while building them because that audience has to be there. If you put this in a wrong catchment then it won’t get the kind of occupancy levels that one is looking for. Q: You began your carrier as a movie hall owner and then you went into distribution and production as well. Was that all intended from the beginning?
A: No, I was supposed to join my father’s transport business. We had a trucking company established in 1939 by my grandfather, but in 1988 when I finished college I had a choice to either run the transport company or to run one single screen cinema which my father had bought in 1978. My dad wanted me to take up transport business which I did for two years and I was completely lost.
Then, I requested him in 1990 if I could do something to the single screen cinema called Priya. At the initial stage me and my wife were involved and later on my brother joined in. We refurbished the theater and positioned it as a Hollywood films cinema, like Sterling in Bombay. Sterling was the model that we tried to replicate in Delhi. So, we put the sound system, we put nice seating and cleaned it up. We were very fortunate that the response was phenomenal and that’s where I found my calling, Wow! This is what I want to do.
_PAGEBREAK_ Q: From creating the multiplex revolution, you went into production which is a completely different world?
A: Yes, I know. I am not sure how comfortable I was in that world. Q: It’s not something you planned to go ahead with?
A: We still have one movie coming. We started off very well but we are going very slow on the production side now. It started with distribution business. Me and my brother Sanjeev run the company together, he started the distribution business in 2003 and where we are just getting some Hollywood films. With our exhibition circuit we could also overlay a distribution circuit all over the country, because we opened in Bangalore, Hyderabad, Bombay everywhere.
With the distribution network we decided that now that we have the network we can even rather than acquiring movies and distributing them, maybe we can get into production. We were just entertaining the thought in 2006-2007 when I saw Rang De Basanti, Aamir and Rakesh Mehra had come for the premier. I spoke to him and said I have a plan to partner in producing a movie if you ever think of doing a film next in your production company and we have the distribution network. 
I think that conversation must have gone down very well. That’s when we did Taare Zameen Par and Jane Tu Ya Jaane Na in 2007-2008. So, that was our foray into production. We have a film called Shanghai with Dibakar Banerjee who did Khosla Ka Ghosla, LSD and Oye Lucky Lucky Oye. That film has got Abhay Deol, Emraan Hashmi and Kalki which is releasing on June 8. Dibakar was very fascinated by one French film and he bought the rights for that and we got involved in that. Let’s see what happens. The trailers are already out. Q: You are expanding in entertainment sector and including Blu-O?
A: That’s right. Q: What is that?
A: It’s a long explanation. I will try to make it very short. Q: You are a bowling aficionado somewhere in there?
A: We were finding that most of the cinemas are in shopping centers and malls and shopping centers and malls don’t have an entertainment solution other than cinemas. We felt that if we can take a step of being a retail entertainment company.
This is retail entertainment, if you are showing films. How do we augment this further by adding some more formats and make a destination out of the mall that we are in. When you are in the movie business you can do backward integration and get into production and distribution or you can do forward integration and get into retail entertainment business. So, I was keen to get the taste of both. Q: Where does movie making come in anywhere in backward integration? Will we see you taking the director’s hat at some time?
A: No, I don’t think so. At the most it will be a producer who should be more involved and at the same time leave the director to do what he does best. Q: Looks like you have expanded yet into another industry altogether, the hospitality world?
A: Yes, can you believe it. I didn’t realise that the whole Director’s Cut foray will force us into getting into hospitality. What started off an experiment is becoming a full fledged F&B operation now. Q: A blessing in disguise I suppose, because I hear the money is in F&B?
A: Yes, F&B is an important part of the business and the whole business model really works on. So far it was popcorn, cola, nachos, hot dogs which is more of an on the go food or movie food. But, with this venture it is a proper sit down dining experience with large variety, quality and service. So it’s fun. It’s a new thing which we have gotten into by default and it’s enjoyable. Q: How do you divide your time between your existing exhibition business and the new ventures or initiatives that you are trying to get into?
A: 80% of the management time spent in exhibition business, but as I said we have got quite a few screens coming up. I also don’t want to open screens for the heck of it, because a lot of people measure you by how many screens do you have and I believe that’s not the right measurement.  We are a listed company and we need to get right EBITDA and PAT margins. It has to be profitable growth. 80% of my time still is on this aspect whether what we have created and what is coming in the pipeline all that is correct or not. Then there is some time left still to look at evaluating new business opportunities which fit into the PVR scheme of things.
_PAGEBREAK_ Q: What about mentors? I am sure you had a few along the way and still do. Who might some of them be?
A: On personal front, my father who unfortunately passed away and now my mother, she is a big guiding force for me. On business side Sunil Mittal. I do take advice from him at critical points only when I think something very serious, like IPO. Before that private equity, when that came. Q: I believe Mr Mittal advised you into Harvard Management CEO program?
A: That’s right. After opening the first multiplex I knew that we have hit upon something because the response was extremely good. But how to make it scalable was always bothering me, because I didn’t want it to be like a mom and pop operation. Mr Mittal advices to take three-year Owners’ Management Program from Harvard, divided into three weeks each year. It’s like a very fast track MBA degree which really sort of opened my eyes. It worked for me. Analjit Singh of Max India, Renuka Ramnath, ex-ICICI Ventures employee, she did her first equity investment out of our fund into PVR in 2003. I take a lot of advice from her. Mr. Sinha who is also our board member he advises me on many critical junctures and whenever I find that there is too much confusion in my head. Q: I am sure you will be inspiring a lot of future entrepreneurs?
A: Well I still haven’t got a call from anyone. Q: How do you divide between personal and professional time?
A: A good management team should be able to understand the core values and once they understand the values, I guess they also give you enough free time to create that balance. Q: Would you say your family says they see you enough or are you just never home?
A: Is there an interview with them as well? Q: One that you don’t know about?
A: think there are not too many complaints. Again at critical points you need to be there, mom is a great guiding force to ensure that I don’t get carried away with just business. My brother is a big influence on me. He is five years younger than me, but at the same time he is always there to ensure that enough time is being divided. My daughters have all grown up. My elder one is 20, the other one is 18 and my son is 13. They do demand and need my attention. Q: Do you think your daughters are going to follow your footsteps?
A: They are big movie buffs. I have no idea what’s on their mind, but all I know is that they are way above average movie buffs than I was their age. They are just studying at the moment. It’s too early to say anything. But they do come and audit this place and all the cinemas when they come they have some great suggestions to give. But it’s too early to say what they are going to do. Q: Now your last name, your surname I believe has a little bit of an interesting story behind it?
A: Yes. Q: Should I prompt you?
A: My grandfather got this alias or title during the 1947, Bijli Pehalwan but otherwise our family name is Mehra, but he got this and then he inherited and accepted it and then my dad Kishanmohan Bijli also. So by the time I born it was already there. So I didn’t have much to question why am I called Bijli. But this is the story that I hear from my mom that in 48 or 49 is when all this happened. Q: It’s got a real ring to it?
A: Yes. Q: Who knows you may diversify into the power sector one day?
A: I don’t know. Q: I have also heard that you have a bit of a rock star vibe about you. Is that right? You were in a rock band at one point?
A: My god, did you Googled the right name or something else? Q: I just wanted to know if it was Glenn, Metal or Punk, what it is?
A: I used to be fond of singing. Q: Oh, you were a singer?
A: Yes. So like any other Delhi college boy we had a band it was called Modus Operandi and we used to do just stuff like Dave Flipper, Phil Collins, Genesis, Pink Floyd. Q: Can we get a little demo?
A: Not really. Completely out of touch. It was fun. Q: No, you don’t look like a man who really takes a lot of time off, but I am sure some Sundays you just want to give this all up and is it more about a lazy lunch, watching a movie. Coming back from work and watching the movie, or just staying in bed all day?
A: I think Sundays I dare not to come to the cinemas, because if I do then I start auditing. But Sundays I am typically at home. I can go for lunch with the family. But Saturdays also is like a semi-off but then I am visiting the properties. That’s a good time to see what’s really going on at the bowling center, at the cinemas and just sort of make your list of what are the improvements we can do. So I think Saturdays are reserved for that. But Sundays is completely Blackberry off and not really getting involved in work at all.