Ajay Bijli, the founder of PVR Group, started his business journey at the age of 22 when he joined his father’s transport business, Amritsar Transport Company in 1988.
Bijli was not too enthusiastic about the transport business and so after he got married in 1990, he spoke to his father about doing something on his own.
Initially, over and above the transport business, Bijli decided to focus on Priya Cinemas (originally called Priya Love Vikas Cinema) which his father had acquired in 1978. The property had lost its reputation and ceded ground to rivals as it was unable to launch popular movies.
Ajay started the cinema’s turnaround by targeting a niche audience, playing Hollywood movies and refurbishing the interiors. Taking inspiration from Sterling Cinema Mumbai, he renovated Priya by installing a Dolby Sound System, adding life and color to the grey interiors, renovating the toilets and providing uniforms to the staff. Coinciding with these changes, the Indian government partially decontrolled movie ticket prices as well, propelling Priya’s quick ascent.
The first multiplex in India
After his father passed away in 1992, Ajay juggled between the family’s transport business in the day and Priya Cinemas (with his wife’s help) at night. A devastating fire at the transport business facility pushed him to make a choice between the transport and cinema, he picked the latter, of course. Priya, by then, had become a hub where people met in the city (Delhi), it also successfully attracted outlets like McDonald’s, Archie’s and Nirula’s-“potentially our answer to Times Square or Leicester Square?” Bijli wondered.
“I didn’t have much of an education, but common sense told me that maybe English movies would do well since the demographics of the area–RK Puram, Vasant Vihar, and Som Vihar-pointed to that,” he said in an interview.
Bijli now wanted to introduce a western-style multiplex, but the problem was the lack of expertise.
Where there is a will, there is a Road(show)
At that time, a Hollywood distributor who Bijli was in touch with, asked him to contact Village Roadshow in Australia, a company looking to enter India. Ajay met Village Roadshow‘s Asia MD John Crawford and they worked out a 60:40 JV (60 percent being Priya’s) and thus “Priya Village Roadshow” was born which later went on to become PVR. The venture set-up India’s first multiplex with 4 screens after leasing Anupam Cinema at Saket–Delhi with the name Priya Village Roadshow Anupam 4.
According to Bijli, “There were kilometer-long queues when we opened. And our campaign was very explicit: Four cinemas under one roof, 24 shows a day, multiple cinema complex.”
PVR continued to expand its reach in Delhi with Sonia (theatre) being converted to PVR Vikaspuri and Payal to PVR Narayana. However, adversity struck again in 2001 when the global business environment changed post the 9/11 attacks and Village Roadshow (PVR’s JV partner) looked to desperately exit India.
The problem was that Rs 100 crore worth of projects totaling 50 screens, were already committed by the JV, but now Bijli had to fund the pending projects as well as Village Roadshow’s stake all by himself.
After consulting with his friend Sunil Mittal (Bharti Airtel), he spoke to some private equity investors and eventually was able to secure funding from ICICI Ventures led by Renuka Ramanathan (Rs 40 crore equity/40 crore debt) thereby raising Rs 80 crore. Bijli too sold some of his personal property to raise money. It was an amicable exit and thus PVR came into being.
What followed then was PVR’s aggressive expansion outside North India in metros like Bangalore, Mumbai, Hyderabad and Chennai. The company’s IPO in 2006 provided ICICI ventures part-exit and refilled the company coffers with up to Rs128 crore. PVR thus embarked on a journey of strong organic and iInorganic growth visible in its rapid screen expansion and has now become the biggest multiplex chain.
As a result, PVR today boasts a pan India presence across 71 cities covering 845 screens, making it the largest multiplex player in the country.
(Excerpted with permission from Ambit Asset Management’s Disruptor Series. You can find similar reports here)