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Bombay Talkies, the first Indian company to publicly issue shares in 1934

Eighty-three years ago, the film studio founded by Himanshu Rai, offered the shares of its company to the public.

Sonal Pandya

In 1934, Bombay Talkies became the first Indian studio to introduce its shares to the public. Himanshu Rai, its founder, received a European film education, picking up most of what he knew from the German film industry. His first feature, The Light of Asia aka Prem Sanyas (1926) was a silent film directed by Franz Osten, a co-production with the Emelka Film Company of Munich.

It was the beginning of many co-productions with the country with Shiraz (1928) and A Throw of Dice (1930) which were released later. Rai got the help of Sir Richard Temple, a son of the former Governor of Bombay to form the Himanshu Rai Indo-International Talkies in England. The company produced Karma (1933), co-starring Rai’s wife Devika Rani, to great reception internationally and later back home as well.

Himanshu Rai and Devika Rani in Karma (1933)

Rai had great plans for his newly found company and launched Bombay Talkies in 1934 in India. Using a capital of Rs25 lakh, Rai formed the first public limited film company and issued the shares on 26 February 1934 to the public. The company’s board of directors boasted of the who’s who of Bombay society with FE Dinshaw, a businessman who lent his summer mansion in Malad for the studios to form a base, Sir Chimanlal Setalvad, the famed barrister, Sir Chunilal B Mehta, the bullion broker and financier, Sir Phiroze Sethna, head of the Central Bank of India and Sir Cawasji Jehangir, an eminent member of Bombay’s Parsi community.

The states of Hyderabad and Jaipur also supported the studio, with the Nizam of Hyderabad commissioning Bombay Talkies to produce instructional films. The August issue of Silver Screen magazine stated: The company has been floated with an authorised capital of Rs25 lakh and an issued capital of Rs10 lakh... Cumulative participating shares of Rs100 each. Shares of the face value of Rs2,52,900 have been applied for by the directors and their friends; the subscription list is open and will be closed on or before 13 August 1934. The company will be commencing its activities, it is expected, with six films during the first twelve months at an estimated average cost of rupees one lakh per film. A net profit of Rs35,000 per film exploited. The company expects additional income from its production of educational and advertising films.

Following the international model, the studio was fully formed by 1935. Rafique Bagdadi wrote in his definitive article on the studio’s 50th anniversary in 1984 for Screen magazine, “A sound and echo-proof stage was built along with dressing rooms, laboratory workshops, offices, a restaurant and a theatre. Rai bought the best equipment available – several modern cameras, the latest sound recording apparatus, a triple set of automatic film developing and printing machines, editing tables, several batteries of high-powered arcs and the only set in India of the newly-invented playback apparatus.

Bagdadi spoke to Cinestaan.com about the studio’s rise and fall. “They ran Bombay Talkies as a factory, as a company. You had to go in the morning at 9 o’clock, come back at 6 o’clock and you had all the facilities in the studio itself,” he said They gave a dividend till some time and then by the time the war had come close, in 1939, most of the German workers were detained at Deolali.”

The loss of international talent initially hurt the company and Rai, under a lot of stress, was hospitalised and later died in 1940. Bombay Talkies bounced back with Kismet (1943) directed by Gyan Mukherjee and starring Ashok Kumar and Mumtaz. The film ran for three straight years at Kolkata’s Roxy Theatres. But in its aftermath there was a split in the core group of initial creators who left to form their own companies.

But when the shares of the company were first introduced, they flourished. Bagdadi says, “A lot of people had an understanding of the market, what they should do and what they should not do. Because the studio system was throughout the world and Bombay Talkies was very much influenced by USA and the German studios, they had an idea of what they were doing.”

Later on, when the company fell on hard times, shareholders were offered tickets to Bombay Talkies films instead of dividends. Bagdadi had come across some share certificates during his research of the Screen article. “The people who lost a lot of things were the people who were working. In 1955, the company closed down and it was in bankruptcy. They sold out the rights of their films. There was no money coming in. The shares, initially for five or six years were very good,” he explained.

After the studio shut down, the Malad compound was turned into an industrial estate and the workers who were part and parcel of Bombay Talkies’s legacy were out of a job. Phani Majudar's Baadbaan (1954) starring Dev Anand, Ashok Kumar and Meena Kumari became their last film.