The Greatest of All Time (GOAT), a Tamil movie starring actor Vijay made with a budget of over ₹300 crore and to hit the screen on September 5 will be the biggest release for the season. Directed by Venkat Prabhu, the film was produced by the Chennai-based AGS Entertainment.
“GOAT will be one of the most profitable for us,” said Suresh Kalpathi, CEO of Veranda Learning, Co-founder of Kalpathi Investments, AGS Cinemas & AGS Entertainment, and Angel Investor.
“If you go with big stars, the budgets are high; you pay quite a bit, but most often than not, your profit is realised on the table. Chances of failure are extremely little to zero. This is contrarian when people talk about the film industry where typically about 10 per cent of the movies succeed very well; 15 to 20 per cent break even or make something and most of the others lose money,” he told businessline.
Watch | Vijay’s GOAT will be the most profitable for us: Suresh Kalpathi, AGS Entertainment
AGS Entertainment, established in 2006 by Kalpathi brothers - S. Aghoram, S. Ganesh, and S. Suresh - have so far produced 25 movies with GOAT being their 25th.
In Tamil films, if you go with the top actors, generally you are guaranteed success. Of course, you have access to money. You should be able to get your production going on time, get the film on schedule and get it released clean. “The type of returns that you can get in this industry, if you are exposed to many other industries, you will realise that this industry is significant,” he said.
For instance, if a movie is ₹100, typically, the peak investment is only ₹60 or ₹65 because you actually start collecting advances, which gets rolled into this. And if you are making, let’s say, a 35 per cent profit on ₹100, effectively you are making a 35 per cent profit on a ₹65 investment. That’s like 50 per cent. And most movies get done in 12 months. Which industry gives a 50 per cent return on investment in one year? said Kalpathi.
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Speaking on risk factors, Kalpathi insurance is taken for all the movies to protect against any exigency. Let’s say there is a big cyclone that shuts down for two or three months; a political turmoil or a terrorist attack or something happens, ‘we are protected, so we ensure we take all types of insurance,’ he said. “When you take insurance, you have to do it by the book. We keep squeaky clean accounts audited by a big four,” he added.
AGS Entertainment is doing another movies with Pradeep Ranganathan of the Love Story fame and also produced by the production house. Its a similar genre, he said. It will also be profitable, he added.
On the recent re-release of Vijay movie Gilli that was a major success, Kalpathi said, it came as a surprise to everybody. It was also because it was probably the first time in a normal situation (April to June-July) is the peak month for movie releases because it is summer; all schools and colleges are closed. Everybody is free and they hit movie halls. A lot of big movies are released then. If you really look at the last two, three months, there has not been big releases. The movie Manjummel Boys became a big success; Aavesham became a success and small films are becoming success. This is also because the screens are not having big movies, he said.
On April 14; April 28th and May 15th, everybody takes a slot, but it was vacant this year, he said. Everybody got their production schedule got mixed up and everybody missed the summer. Even Rajanikanth’s film is slotted for Diwali, he added.
When asked if OTT had any impact, he said, “I don’t think so because I’m not seeing any big ones on OTT also.”