Does Shah Rukh Khan Enter a 45% Profit-Sharing Agreement with YRF for the Movie Pathaan?

Yes, Shah Rukh Khan entered a profit-sharing agreement with YRF Films for the movie Pathaan. According to reports, he would receive a 45% share of the profits from the film. This agreement highlights the significant star power and marketability of Shah Rukh Khan, especially considering the film's anticipated success.

Pathaan, which was released in January 2023, went on to become one of the highest-grossing Bollywood films of all time, further validating the terms of the agreement.

A Tradition in Bollywood: Profit-Sharing Agreements

It is an unwritten rule in Bollywood that actors like SRK will have a share in the profits of a YRF film. This tradition continues with Pathaan. In the past, SRK was an outlier, preferring a flat fee and rejecting profit-sharing agreements. However, this is changing, and most actors in Bollywood now enter into profit-sharing agreements.

Token Fees vs. Profit-Sharing Agreements

Many actors today charge token amounts as their fees, ranging from Rs. 50 Lakhs to Rs. 5 Crores. For instance, Salman Khan, since Bajrangi Bhaijaan, has been charging only Rs. 10,000 as his token amount and has earned over Rs. 350 Crores from his films over the past five years. Shah Rukh Khan was the only major actor who did not follow the token fee model, sticking to flat fees.

SRK claimed that actors should not be judged solely on the success of a film, as factors such as marketing, release timing, and direction play significant roles. However, since the release of 'Zero' in 2018, SRK has been forced to follow the profit-sharing model due to the studios' refusal to pay the high flat fees.

Profit-Sharing Agreements in Detail

According to the terms of the agreement with YRF for Pathaan, Shah Rukh Khan will receive 45% of the profits after YRF has recovered their budget. If YRF's budget was Rs. 200 Crores and the film generated a total of Rs. 530 Crores, YRF would take back their Rs. 200 Crores plus Rs. 25 Crores. The remaining Rs. 280 Crores would be split 55:45 in favor of YRF and SRK respectively. This means SRK could receive almost Rs. 130 Crores in profits.

Notable Actors in Profit-Sharing Agreements

Several other prominent actors in Bollywood have also moved to the profit-sharing agreement model:

Aamir Khan: Since 2008, Aamir has only received Rs. 0 from the box office for Thugs of Hindostan. Salman Khan: Since 2015, Salman has followed the profit-sharing model. Akshay Kumar: Since 2016, Akshay has been receiving profits from his films. Hrithik Roshan: Since 2019, Hrithik has followed the profit-sharing model. Ayushman Khurana: Since 2018, Ayushman has accepted profit-sharing terms. Ranveer Singh: Since 2014, Ranveer has received profits from his films. Ajay Devgn: Since Golmaal 3, Ajay has been following the profit-sharing model.

Some actors still prefer the old formula of assured and contingent pay, including:

SRK (until 2018): Zero Amitabh Bachchan Sunny Deol Saif Ali Khan Shahid Kapoor

The shift to profit-sharing agreements in Bollywood reflects the changing dynamics of the film industry, where the success of a film depends not just on the star's performance but also on a variety of external factors.

Conclusion

Shah Rukh Khan's entry into a 45% profit-sharing agreement for Pathaan marks a significant shift in contractual practices in Bollywood. This move aligns with the growing trend of actors accepting a share of the profits rather than fixed fees, reflecting the complex and multifaceted nature of the Indian film industry.