Lyca Productions steps away from Mohanlal's Empuran, faces uncertain future amid reports of financial struggles

Lyca Productions, the renowned production house that entered Tamil cinema with Kaththi in 2014, is reportedly shutting down operations following Jason Sanjay’s upcoming film. Interestingly, the company, which began its journey with Thalapathy Vijay’s film, might be concluding its run with a project helmed by his son. The production house is yet to comment on reports of financial troubles.

Lyca Productions has played a pivotal role in financing some of Tamil cinema’s biggest films, including Mani Ratnam’s Ponniyin Selvan series (PS-1 and PS-2), Shankar’s 2.0, Indian 2, and Indian 3. They have also backed several notable films such as Vada Chennai, Chekka Chivantha Vaanam, Kolamavu Kokila, and Don.

Reports indicate that the production house has been grappling with massive financial losses, exacerbated by big-budget projects like 2.0, Chandramukhi 2, Lal Salaam, Darbar, Kaappaan, and Ram Setu. More recently, the underperformance of Indian 2, Vettaiyan, and Vidaamuyarchi has further strained their finances.

Adding to their challenges, Lyca’s parent company, Lyca Mobile, is embroiled in VAT and money laundering cases in France and the UK. These legal troubles have reportedly created severe financial instability, prompting the production house to halt new film investments.

The financial strain has led to partial exits from key projects. Lyca reportedly withdrew from L2: Empuraan, starring Mohanlal, due to a financial dispute with Aashirvad Cinemas, leading to Sree Gokulam Movies stepping in.

It is believed that Gokulam Gopalan repaid Lyca’s Rs. 75 crore investment, facilitating their exit.

Meanwhile, the company has been criticised for lackluster promotions of major films like Vidaamuyarchi and Vettaiyan, fueling speculation about its diminishing influence in the industry. There are also doubts about whether they will be able to complete Indian 3.

Reports suggest that Lyca has funded 90% of the budget for Jason Sanjay’s debut directorial as a first-copy investment. The young filmmaker is said to have meticulously planned production to avoid financial setbacks. If Indian 3 manages to release, it could be Lyca’s last major film, while Jason Sanjay’s project might mark their final venture in Indian cinema.

Lyca Productions now seems to be following the path of other corporate giants like UTV, Reliance, Sahara Movie Studios, Eros International, Pyramid Saimira, and Moser Baer—companies that struggled to sustain themselves in the highly unpredictable Indian film industry.