Amid box office jitters, Saregama eyes majority stake in Dharma Productions

Saregama is in talks to acquire a majority stake in Karan Johar's Dharma Productions, though the deal may not finalise soon. The move comes amid box office volatility affecting studios

Music label major Saregama India, owned by RP Sanjiv Goenka, is reportedly in talks to acquire a majority stake in producer Karan Johar’s company, Dharma Productions, Livemint reported on Monday. Sources cited in the report suggested that the deal may not occur and has not reached the final stages.

This development comes at a time when box office volatility and rising star fees are making it tougher for production companies to operate independently, a challenge Dharma Productions is also facing. The report added that Dharma Productions has been seeking investments for some time.

Recent projects from Dharma Productions include Kill, Bad Newz, Yodha, and Mr & Mrs Mahi. The Alia Bhatt-starrer Jigra is set to hit theatres this week. Recently, Johar has commented publicly on the “unprecedented” compensation demands of movie stars. On September 24, he revealed in an interview that some leading actors had demanded Rs 40 crore in fees for Kill, which surprised him since that was the entire budget of the film.

The report added that Dharma Productions posted revenue of Rs 1,044.16 crore in the financial year 2022-23, with a profit of Rs 10.69 crore. Meanwhile, Saregama collected revenue of Rs 790.3 crore, with a net profit of Rs 185.1 crore.

In September 2023, Saregama acquired a majority stake in digital entertainment company Pocket Aces Pictures, purchasing 51.8 per cent for Rs 174 crore. Saregama plans to acquire an additional 41 per cent stake in the firm in the future.

The Covid-19 pandemic has been cited as one of the reasons for poor box office performance in recent years. Prolonged lockdowns, combined with the rise of cost-effective streaming platforms, have changed how people consume content.