Humanist Babu Gogineni Family Exclusive Interview

The debate over soaring hero remunerations has once again taken center stage as film budgets continue to spiral out of control. While producers are making every effort to cut costs across departments, one area that remains largely untouched is the hefty paychecks commanded by leading stars.

Veteran producer Dil Raju has now explained the financial reality of big-budget films with a simple example. According to him, in a film made on a budget of ₹300 crore, nearly ₹120 crore goes solely towards the hero’s remuneration, leaving producers with a shrinking margin to recover their investment.

“If a distributor buys such a film as a crazy project and it underperforms, the distributor incurs losses. If the film is released through third-party arrangements or on a hire basis, exhibitors suffer. Ultimately, the losses are shared only by three people—the producer, the distributor, and the exhibitor,” Dil Raju said.

He revealed that this financial reality has changed the way he chooses his projects. Instead of blindly agreeing to fixed remuneration demands, he now prefers to collaborate only with heroes who understand the changing economics of the industry.

Dil Raju said he begins every discussion by calculating the minimum recovery a film can generate. Based on realistic estimates of theatrical and non-theatrical revenues, he sits down with the hero to work out a mutually beneficial financial arrangement.

“I explain to them that market calculations have changed completely. I tell them how much theatrical and non-theatrical revenue is realistically possible, and then we discuss how to share it. Some heroes understand this approach, while others don’t. I choose to work only with those who do,” he explained.

The producer strongly advocated replacing the traditional fixed remuneration model with a profit-sharing system. Drawing a comparison with the ongoing shift of single-screen theatres from rental agreements to percentage-sharing models, he argued that heroes should also embrace revenue sharing instead of demanding massive upfront payments.

Dil Raju pointed out that several leading Bollywood stars, including Salman Khan and Akshay Kumar, already follow the profit-sharing model in films he is producing with them.

According to him, when actors become stakeholders in a film’s success rather than merely drawing fixed salaries, they naturally take greater responsibility for the project’s performance. He believes such a system will not only bring budgets under control but also create a healthier and more sustainable business model for the entire film industry.