Ae Dil Hai Mushkil Hit or Flop: Business Economics

Karan Johar’s Ae Dil Hai Mushkil was one of the most anticipated movies of the year. The expectations were high because Karan was returning 4 years after ‘Student Of The Year’ and he had a solid star cast in Ranbir Kapoor, Anushka Sharma and Aishwarya Rai Bachchan too.

But the odds throughout the campaign were stacked against the film. There were threats of boycott because it featured Fawad Khan, there was a bigger film ‘Shivaay’ which was also scheduled to release on the same day and many though ADHM might only appeal to the urban audience.

6 days after release, the tide has turned and ‘Ae Dil Hai Mushkil’ is already a profitable film for its investors.

The breakup of economics:

• Cost of Production – 68 crore
• Print and Advertising – 20 crore (14 crore in India, 6 crore overseas)
• Margin for Fox Star Studios – 15 crore
• Total – 103 crore

Note: The cost of production does not include Karan Johar’s direction fee, but it doesn’t need to (he is the producer).

Non-theatrical Recovery:

• Satellite Rights – 45 crore
• Music – 19 crore
• Digital – 10 crore
• Total non-theatrical – 74 crore

In short, even after including the distribution margin of Fox Star Studios, Ae Dil Hai Mushkil has to recover only around Rs 29 crore from theatrical business – a figure that would be covered just from the overseas business of the film.

However, a big film like ‘Ae Dil Hai Mushkil’ cannot be declared a hit if the domestic net box office collections aren’t equal to or higher than the costs.

Here is the break-down of how much Ae Dil Hai Mushkil needs to attain various box office verdicts:

• Below 85 crore – Flop
• Below 100 crore – Average grosser
• 100 crore or more – Hit
• 130 crore or more – Super hit
• 170 crore or more – Blockbuster