IT raid at Ramayana producer’s office sends shares down 8%

An Income Tax search at the Mumbai office of Prime Focus Ltd has put the company behind Ramayana in the headlines for reasons no producer wants, less than a month before the film’s Diwali release.

What happened on October 7

Officials of the Income Tax Department carried out searches at Prime Focus’s Mumbai offices on October 7. Prime Focus is headed by Namit Malhotra, the producer steering Nitesh Tiwari’s two-part mythological epic.

According to CNBC-TV18, the searches are reportedly connected to foreign remittances. Neither the tax department nor the company has yet disclosed which transactions are under scrutiny, how much is involved, or how long the process may run.

Investors did not wait for details. Prime Focus shares reportedly fell around 8% during morning trading the same day, making the tax action the company’s dominant story of the day.

Why Prime Focus matters to film fans

Prime Focus has a wide footprint across visual effects, animation, post-production and content creation. Its VFX arm, DNEG, is handling the extensive effects work on Ramayana, which has been reported to carry a budget of Rs 4,000 crore.

The searches come days after a minor fire near the film’s sets at Prime Focus Studios in Mumbai. That incident caused no injuries, and production resumed once the fire was brought under control. Together, the two events have drawn more attention to the production’s workings than its promotional beats, even as release day approaches.

The film behind the noise

The first part of Ramayana is scheduled for November 5, 2026, timed to Diwali; the second part is planned for Diwali 2027.

• Ranbir Kapoor as Lord Ram
• Sai Pallavi as Sita
• Yash as Ravan
• Sunny Deol as Hanuman
• Ravie Dubey as Lakshman
• Arun Govil as Dashrath, Lara Dutta as Kaikeyi and Rakul Preet Singh as Surpanakha

The film is produced by Prime Focus Studios with DNEG and Yash’s Monster Mind Creations. Its music brings together Hans Zimmer and AR Rahman, a pairing that has only raised expectations.

What to watch next

A tax search is an investigative step, not a verdict. In common usage, foreign remittances are cross-border transfers of money; tax authorities often review them to check whether withholding and reporting rules have been followed. That does not imply any conclusion, but it helps explain why investors treat the word “searches” as a risk until the department says more.

For the industry, the key signal is whether the action slows post-production, financing or distribution. For audiences, the practical question is simpler: has the release date changed? There is no sign of that yet.

The stock slide shows that investors are cautious about what may come out of the searches. Film fans should treat the Diwali date as intact unless the makers announce otherwise, and watch for any official statement from Prime Focus or the Income Tax Department.

Source: The Times of India