Karan Johar sold a 50 per cent stake in Dharma Production to Serum Institute of India's CEO, Adar Poonawalla. The deal was made on a budget of Rs. 1000 crore. This news broke all the headlines, leaving people wondering what could be the possible reason. Well, it was speculated that the reason that the decision was made as Dharma Production was running at a loss. And now, Karan Johar revealed the real reason for the same.
While talking on CNBC-TV18 Global Leadership Summit, Karan Johar said that intellectual property has been a huge part of valuation. The filmmaker mentioned that the real issue with funding had been that they would have to partner with a studio for the bigger films, thus even after making big movies, they would end up sharing the profit. Karan remarked that it helps them to increase profit and even owe the movies entirely. He stated that at their stage, it's not possible for them to fund a Rs. 250-300 crore movie. In Karan Johar's words:
"So, even when we made big hits, we were always sharing the profits. In this scenario, it gives us the opportunity of increasing and enhancing our profitability and owning the film entirely. Yes, there will be those massive Brahmastras that we will make that will need the support of a studio. If I make a film that is over Rs 250 crore or Rs 300 crore, it’s not possible to fund that totally at our stage even now.”
In the same conversation, Karan Johar shared that the profit is super high for a mid-budget movie. Explaining the same, the filmmaker mentioned that at a mid-budget movie, one can fund it on their own and enjoy the breakthrough profits that it makes. Stating that the real money comes from these mid-budget movies worth Rs. 65-80 crore, Karan said:
"It’s a middle-budget film, where the cost to profit is super high. Those are the films that you can fund entirely on your own, and you can enjoy and reap the benefits of the big breakthrough profits. I believe the real bread and butter, the real money comes from middle-budget film.”
During the same conversation, Karan Johar had stated that Adar is one of his dear friends. Karan said that he talked to Adar about this, and they both came to the decision to collaborate. The filmmaker revealed that both of them, who are like-minded people, felt that it would be the best decision for them. Karan added that he thought it to be the marriage of two minds, and he made the partnership with someone who could even enlighten him with business insights while allowing his creative vision. He further said that it was not a big decision, as making a partnership with Adar was easy and the best option.
Adar Poonawalla, in the conversation, revealed being shocked by his decision to make a partnership with KJo's Dharma production. He mentioned that it was a good business opportunity, as the verticals like music distribution and content creation would thrive in the coming years.
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Earlier, a report by India.Com revealed that, as per an analysis of Dharma Productions’ recent track record, the reason of Karan selling 50 stake in Dharma Production could have been influenced by financial crunches. For the unversed, from 2022 to 2024, Dharma Production released a series of 10 films, and among them, only one could mark its success at the box office. Talking about the rest of the nine films, four among them were average, two were flops, another one was below average, and the other two were tagged as 'disasters'.
What do you think about Karan Johar's revelations?
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