Reliance Industries (RIL) is reportedly negotiating a potential stake acquisition in Bollywood’s leading production house, Dharma Productions, owned by renowned producer-director Karan Johar. According to sources close to the discussions, this move could enhance RIL’s foothold in India’s growing content production sector however the exact size of the stake remains undisclosed.
Karan Johar currently holds a 90.7% stake in Dharma Productions, while the remaining 9.24% is owned by his mother, Hiroo Johar. Notably, having produced numerous successful Bollywood films the production house has an impressive track record.
A person familiar with previous negotiations, said, “Karan Johar has been looking to monetise his stake in Dharma for some time, but past deals have fallen through due to disagreements over valuation.”
With rising production costs, decreasing footfall in theatres, and shifting audience preferences towards over-the-top (OTT) platforms, Dharma Productions’ search for strategic partnerships highlights the financial pressures currently impacting the Hindi film industry.
Previously Dharma Productions was in discussions with Saregama, the music label backed by entrepreneur Sanjiv Goenka, for a potential majority stake sale. However, Saregama stated that it had no significant updates to share regarding the matter in a filing with the Bombay Stock Exchange (BSE) on October 8.
Additionally, reporting a significant jump in revenue for FY23, Dharma Productions reached ₹1,040 crore nearly four times higher than the previous year’s ₹276 crore. However, according to financial data accessed from Tofler despite this revenue surge, the company’s net profit dropped by 59% to ₹11 crore, largely due to a sharp 4.5-fold increase in expenses, which amounted to ₹1,028 crore.