Reliance Industries in Talks to Acquire a Stake in Johar’s Dharma Productions

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OCTOBER 15,2024

Reliance Industries Ltd. (RIL) is reportedly in advanced negotiations to acquire a significant stake in Karan Johar's Dharma Productions, one of India's most iconic film production houses. If the deal is finalised, it would mark another major step in Reliance's strategy to dominate the Indian entertainment industry, further strengthening its position in the content production sector.

This acquisition will complement Reliance's existing entertainment assets, such as Jio Studios and Viacom18 Studios, positioning the oil-to-telecom giant as a leading force in India's rapidly evolving media landscape.

Strategic Move for Reliance in Indian Entertainment

Reliance's move to acquire a stake in Dharma Productions is seen as a strategic one. It would allow the conglomerate to consolidate its presence in India's lucrative entertainment market, building on its existing media portfolio, which includes Jio Studios, Viacom18 Studios, Colosceum Media, and a minority stake in Balaji Telefilms.

Jio Studios has already made a significant mark in the industry, earning 700 crore in box office collections in FY24 alone. A partnership with Dharma Productions could further enhance its production capabilities and market reach.

A source quoted in The Economic Times confirmed the negotiations, saying, 'In the past, RIL acquired a minority stake in Balaji. A similar structure could be pursued with Dharma.' Another insider added, 'Karan Johar has been exploring ways to monetise his stake for some time, but previous deals failed due to valuation issues.'

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Why is Dharma Productions Exploring This Deal?

Dharma Productions is currently owned 90.7#37 by Karan Johar and 9.24#37 by his mother, Hiroo Johar. The studio, like many others, is facing industry challenges including rising production costs, declining theatre attendance, and the growing popularity of over-the-top (OTT) platforms. With these pressures, several Bollywood production houses, including Dharma, are considering fundraising opportunities to stay competitive.

Karan Johar is reportedly looking to capitalise on his ownership, especially after earlier talks to sell a majority stake to Saregama fell through due to valuation disagreements.

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Dharma Productions: A Legacy of Bollywood Blockbusters

Dharma Productions, founded in 1979 by Yash Johar, has become one of India's most celebrated film production companies. Over the decades, it has produced numerous blockbusters across genres, from romance and drama to family entertainment. Iconic films like Kabhi Khushi Kabhie Gham, My Name Is Khan, and Student of the Year have cemented its place in Bollywood history.

After Yash Johar's passing in 2003, his son Karan Johar took over the reins, transforming Dharma into a modern, versatile studio. Its legacy continues to shape Indian cinema, making it an attractive acquisition target for companies like Reliance Industries.

As Reliance Industries continues to broaden its media presence, the potential acquisition of a stake in Dharma Productions could further enhance its influence in India's entertainment sector. With this deal, both companies stand to gain from the evolving dynamics of the Indian film industry.