This is the second time that the ace director is shooting in the state. Earlier in 2006, he shot in the picturesque Munnar hills for the Amitabh Bachchan-starrer "Nishabd".
The filming began Saturday in Athirapally forests -- fast becoming a hotspot for the Bollywood industry. Last year, Mani Ratnam was here for his film "Ravana".
"A film unit on a shoot gets trapped deep in a forest. And one by one the crew members start getting killed. This is the main story of the film, " Varma told reporters here.
Athirapally is about 60 km from Kochi and the film crew will shoot here for another week.
Nitin, a Telugu star, and Priyanka Kothari are the main leads in the film.
A major chunk of the movie has been filmed in the Sigiriya forests in Sri Lanka and the film is likely to be released in July, Varma added.
Reacting to the controversy when he was seen with the son of the then Maharashtra chief minister Vilasrao Deshmukh at the Taj Hotel in Mumbai soon after the terror attacks, the director said that it was "accidental" and wasn't meant for any other purpose.