A 100 crore question

Which is better

The 100 crore flick that cost 50 crore or

The 20 crore flick that cost 2 crore

In other words are returns or profits margins more important?

Originally posted by: blue-ice

The second option...Return on investment is 10 times...vs 2 times in the first option...BTW may math sucks..😆

Originally posted by: KuKKad_MalHOTra

Technically speaking, a movie with a greater ROI will be a better one financially.

However, if you look at it this way:

The 2 crore movie would have earned a profit of 18 crore, while the 50 crore movie would have earned a profit of 50 crore.

The producer of the 2 crore movie can own an 18 crore house with the profits, while the producer of the 50 crore movie can own an 18 crore house plus invest the balance 32 crores into some other venture. So who is richer?

Although, the 2 crore producer would have seen his wealth multiply by 10 times, while the other producer, only twice.

But you are only focusing on profits, not on ROI.

Producer X and Y both have 50 crore each.

Producer X makes One Big budget extravaganza and puts it all in. Gets 100 Crore returns. 50-50+100=100

Producer Y makes is cautious and makes small budget movies only. Gets 20 crore returns. 50-2+20 = 68. But Wait this is only if they makes one movie. What if he put it all in. Then we get 50-(2x25)+(20x25)=500

But you will be like not all movies can be hits. 80% movies are flops. The big budget dud rakes in 25 crore at BO. The small budget dud rakes in zero.

50-50+(100x.2)-(25x.8) = 0 crores

50-(2*25)+(20x25x.2)-(2x.8) = 90.4

In the long range forecast also Y is a better strategist than X. In the long run he will be richer.