On the other hand, India's own Reliance ADA Group has entered into multi-million dollar deals with big Hollywood names such as Steven Spielberg's DreamWorks to start a new $1.2 billion film company.

However, the present financial slowdown in the west has also slowed down Bollywood's funding. Siddharth Roy Kapur of UTV Motion Pictures, which has a deal with Will Smith's production company, agrees that the global financial turmoil will affect the entertainment industry in India, especially those companies which have foreign funding.

Even local production houses may have to think twice, says analyst Farokh Balsara of Ernst and Young. "Those who want to raise money the public route will have to re-think their strategy before launching an IPO, because frankly the situation that was six months ago is now a thing of the past. They will either have to rethink their strategy or just change the timing."

But it's not all doom and gloom. The crisis at Wall Street could also trigger off a host of opportunities for Indian entertainment companies, says Balsara.

"This phase could also trigger off a spate of acquisitions by Indian companies looking to build their assets abroad. For example, a multiplex chain in the US could now be going at a much lesser rate due to the sub prime crisis and this would lend an opportunity to build an entire network in that country. Indian entertainment and India as a whole are still seen as a sound investment and that image won't be shaken any time soon," he added.