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June 21, 2001
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Money > Business Headlines > Report June 21, 2001 |
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IDBI rolls the tapes on film financingFreny Patel The Industrial Development Bank of India has become the first financial institution to venture into film financing. The bank kicked off film financing by sanctioning the first loan worth Rs 40 million last week. The financial institution approved the loan to the Hyderabad-based Suresh Production Pvt Ltd for financing the Hindi translation of the Telegu movie Kalisundam Raa ('Stay together'). The advisory committee that met on Tuesday this week has given preliminary clearance to a number of other Indian films where the cost of production ranges from Rs 60 to 300 million, said IDBI executive director, R S Agarwal. "We will sanction some more loans towards film financing by the end of the month," he added. Ramanaidu, promoter of Suresh Production, is well-known in the film industry and has over 100 films to his credit. The estimated cost of the Hindi production, which is yet to be titled, has been pegged at Rs 80 million. It will star Fardeen Khan, Feroz Khan's son, who recently played the lead role in Pyar Tune Kya Kiya and newcomer Risha. The Hindi translation of the Telegu movie is expected to be released by January 2002, though actual disbursement of the loan will take a while depending upon the speed of documentation given to the financier, FI sources said. As per IDBI's film financing norms, 20 to 30 per cent of the initial funding will be brought in by the promoters, 20 per cent will be paid upfront against distribution rights and the balance by the financial institution for a loan tenure of two to three years. A number of movies have been cleared by the advisory committee for processing and final clearance by the institution's inhouse sanctioning committee. IDBI constituted a panel of 10 to 12 members from the film industry to assist and advise the term lending institution on the bankability of the film projects that come for funding. The expert advisory panel looks into the technical, financial and commercial aspects of the films that come up for funding. The members of this panel belong to the film industry and include film directors, producers, seasoned actors, and directors of film labs and music companies. Powered by YOU MAY ALSO WANT TO READ:
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