Inox Leisure Limited

INOX LEISURE LIMITED INVESTOR PRESENTATION FEBRUARY 2016 1 DISCLAIMER This presentation and the following discussion may contain “forward looking statements” by Inox Leisure Limited (“ILL” or “the Company”) that are not historical in nature. These forward looking statements, which may include statements relating to future state of affairs, results of operations, financial condition, business prospects, plans and objectives, are based on the current beliefs, assumptions, expectations, estimates, and projections of the management of ILL about the business, industry and markets in which ILL operates. These statements are not guarantees of future performance, and are subject to known and unknown risks, uncertainties, and other factors, some of which are beyond ILL’s control and difficult to predict, that could cause actual results, performance or achievements to differ materially from those in the forward looking statements. Such statements are not, and should not be construed, as a representation as to future performance or achievements of ILL. In particular, such statements should not be regarded as a projection of future performance of ILL. It should be noted that the actual performance or achievements of ILL may vary significantly from such statements. 2 DISCUSSION SUMMARY INDUSTRY OVERVIEW COMPANY OVERVIEW COMPETITIVE ADVANTAGE AND OUTLOOK ANNEXURE SHAREHOLDING STRUCTURE KEY MANAGEMENT PER SCREEN ECONOMICS ROCE ANALYSIS DETAILS ON OWNED PROPERTIES DETAILED FINANCIALS 3 INDUSTRY OVERVIEW 4 INDIAN FILM EXHIBITION INDUSTRY STRONG FUNDAMENTALS, LARGELY UNDER-SCREENED, HUGE GROWTH POTENTIAL 2nd HIGHEST NUMBER OF THEATRE FOOTFALLS IN THE WORLD HIGHEST NUMBER OF FILM RELEASES IN THE WORLD Footfalls in Million 2,178 1,602 1,930 1,364 745 554 476 279 324 241 204 182 208 197 176 171 169 156 146 166 China India US France Mexico UK Japan S. Korea Germany Russia India China Japan US France UK Germany S. Korea Spain Italy HOWEVER, INDIA’S SCREEN DENSITY IS ONE OF THE LOWEST Screens / Million population 125 85 82 61 57 26 13 9 US France Spain UK Germany Japan China India Source: CRISIL Report, FICCI Whitepaper on Screen Density in India 5 INDIAN FILM EXHIBITION INDUSTRY STEADY PERFORMANCE AND RESILIENCE INDIAN FILM INDUSTRY DISPLAYS STEADY PERFORMANCE TRENDS 250 In Rs Billion CAGR 10.0% 203.9 200 186.4 170.8 CAGR 11.0% 155.5 136.3 150 125.3 126.4 112.4 92.9 100 83.3 133.7 145.1 113.6 123.5 50 85.1 93.4 93.5 99.9 62 68.8 0 2010 2011 2012 2013 2014 2015E 2016E 2017E 2018E 2019E Domestic Theatrical Overseas Theatrical Home Video Cable & Satellite Rights Ancilliary Revenue Streams DOMESTIC THEATRICALS CONTINUE TO REMAIN THE MAJOR REVENUE CONTRIBUTOR 74.4% 74.1% 75.7% 74.5% 74.0% 73.3% 73.1% 72.3% 71.7% 71.2% 2010 2011 2012 2013 2014 2015E 2016E 2017E 2018E 2019E % Share of Domestic Theatricals in Total Film Industry Revenues Source: FICCI-KPMG 2015 Report 6 INDIAN FILM EXHIBITION INDUSTRY MULTIPLEXES WITNESSING RAPID GROWTH NUMBER OF SCREENS 9,710 FACTORS DRIVING GROWTH IN MULTIPLEXES: 9,308 9,121 8,685 8,451 8,002 . Superior location, destination and parking facilities. State of art equipment (high quality video and audio), superior interiors, ambience 1,350 1,500 1,630 925 1,075 1,225 and service. 2009 2010 2011 2012 2013 2014 . Multiple screens in one location offer a Single Screens Multiplexes wider variety of content to the patrons. Further, different screen sizes provide Multiplexes currently account for programming flexibility. This results in higher occupancy ratios. ~ 16% market share of the screens, however account for . Strong demographics, rising disposable incomes and discretionary spends. more than 40% of box office collections Source: CRISIL Report 7 INDIAN FILM EXHIBITION INDUSTRY MULTIPLEX INDUSTRY IS IN CONSOLIDATION PHASE The Indian multiplex industry has undergone significant consolidation over last decade. Industry leaders have grown not only through organic screen additions, but also through acquisition of smaller regional multiplex chains and single screen players. As a result of this consolidation, the top four players account for ~ 70% of multiplex screens. 491 NUMBER OF SCREENS 413 As on 31th December 2015 138 Cinemax 346 Satyam Cineplexes 38 Glitz Cinemas 30 Fame Cinemas 95 89 Cinemas 7 217 Big Cinemas 242 353 83 Own Screens Fun Cinemas Own Screens 273 Broadway Cinemas 10 Own Screens 134 Own Screens 64 PVR INOX Carnival Cinepolis 8 INDIAN FILM EXHIBITION INDUSTRY INCREASING NUMBER OF INR 1 BN + MOVIES WIDER SCREEN RELEASES 5,200 4,500 3,446 3,359 3,014 2,638 2,065 2,101 1,598 INCREASING NUMBER OF 1,000 MOVIES ARE GENERATING 3 Idiots Dabaang Bodyguard Ek Tha Dabaang 2 Chennai Dhoom 3 Kick P.K Bajrangi MORE THAN RS 1 BN IN (2009) (2010) (2011) Tiger (2012) Express (2013) (2014) (2014) Bhaijaan NET BOX OFFICE COLLECTIONS (2012) (2013) (2015) DRIVEN BY HIGHER NUMBER OF INR 1 BN + MOVIES WIDER SCREEN RELEASES AND 2 2 IMPROVING CONTENT QUALITY 2 9 7 1 5 6 5 1 2 2008 2009 2010 2011 2012 2013 2014 2015 INR 1 BN + INR 2 BN + Source: Industry 9 COMPANY OVERVIEW 10 COMPANY OVERVIEW BRIEF PROFILE . Inox Leisure Limited (ILL), incorporated in 1999, is the 2nd largest multiplex operator in India . ILL is a part of Inox Group which is diversified across industrial gases, engineering plastics, refrigerants, chemicals, cryogenic engineering, renewable energy and entertainment sectors . ILL currently operates 105 properties (413 screens and 107,576 seats) located in 57 BUSINESS cities across India, being the only multiplex operator having such a diverse presence OVERVIEW across pan India . The company accounts for ~19% share of the multiplex screens in India and ~8% share of domestic box office collections . The company has aggressively scaled up through organic and inorganic expansion over last decade growing from 2 properties – 8 screens in FY03 to 105 properties – 413 screens in Q3 FY16, virtually adding on an average 3 screens every month over the last decade 11 COMPANY OVERVIEW TRACK RECORD OF AGGRESSIVE EXPANSION 105 96 413 372 79 74 68 310 63 285 257 239 32 26 22 119 14 91 9 6 76 2 3 51 35 25 8 12 FY03 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 9M FY16 Screens Properties ON AN AVERAGE ADDITION OF 3 SCREENS EVERY MONTH OVER THE LAST DECADE Note: Includes Acquisition of 1) 89 Cinemas in FY08, 2) Fame India in FY11, 3) Satyam Cineplexes in FY15 12 COMPANY OVERVIEW PAN INDIA PRESENCE 2ND LARGEST MULTIPLEX CHAIN OPERATOR IN INDIA PUNJAB | 1 Property | 6 Screens UTTAR PRADESH | 4 Properties | 16 Screens 18 States DELHI | 4 Properties | 13 Screens JHARKHAND | 1 Property | 4 Screens HARYANA | 6 Properties | 19 Screens 57 RAJASTHAN | 11 Properties | 35 Screens Cities MADHYA PRADESH | 4 Properties | 16 Screens 105 GUJARAT | 10 Properties | 40 Screens WEST BENGAL | 13 Properties | 52 Screens Locations ODISHA | 1 Property | 3 Screens MAHARASHTRA | 22 Properties | 96 Screens CHHATTISGARH | 2 Properties | 8 Screens 413 GOA | 3 Property | 10 Screens TELANGANA | 2 Properties | 11 Screens Screens KARNATAKA |10 Properties | 38 Screens ANDHRA PRADESH | 7 Properties | 26 Screens 107,576 KERALA |1 Property | 6 Screens TAMIL NADU | 3 Properties | 14 Screens Seats Includes 6 management properties with 21 screens and 5,486 seats 13 COMPANY OVERVIEW CONSISTENT ORGANIC SCREEN ADDITIONS ADDITIONS IN Q3 FY16 PROPERTIES 4 SCREENS 20 SEATS 4,824 ADDITIONS IN 9M FY16 PROPERTIES 9 SCREENS 41 SEATS 8,827 R City Ghatkopar Goa Osia 20th November 2015 29th December 2015 9 Screens 2 Screens 2,109 Seats 335 Seats Thrissur Sobha City Meerut PVS Mall Mall 31st December 2015 31st December 2015 3 Screens 6 Screens 1,012 Seats 1,368 Seats 14 COMPANY OVERVIEW Q3 & 9M FY16 – RESULTS HIGHLIGHTS Q3 FY16 YoY ANALYSIS REVENUES* EBITDA ** and EBITDA MARGIN PAT and PAT MARGIN 3,417.1 15.4% 15.5% 4.8% 4.6% 3,007.6 528.3 463.1 143.0 156.0 14 % 14 % 9 % Q3 FY15 Q3 FY16 Q3 FY15 Q3 FY16 Q3 FY15 Q3 FY16 EBIDTA EBIDTA % PAT PAT % 9M FY16 YoY ANALYSIS REVENUES* EBITDA ** and EBITDA MARGIN PAT and PAT MARGIN 5.9% 10,457.7 16.7% 14.0% 3.0% 7,990.6 1,748.6 613.7 1,122.6 241.0 31 % 56 % 155 % 9M FY15 9M FY16 9M FY15 9M FY16 9M FY15 9M FY16 EBIDTA EBIDTA % PAT PAT % Note: * Revenue from Operations, ** EBIDTA excluding Other Income In Rs. Mn 15 COMPANY OVERVIEW Q3 & 9M FY16 – REVENUE ANALYSIS Q3 FY16 YoY ANALYSIS 9M FY16 YoY ANALYSIS REVENUES* BREAKUP REVENUES* BREAKUP 3,417.1 10,457.7 515.8 3,007.6 160.2 294.9 716.1 144.6 7,990.6 289.2 2,086.4 11 % 655.1 454.9 13 % 556.3 617.0 2 % 1,536.0 16 % 18 % 36 % 2,306.9 7,139.4 2,017.5 5,382.7 14 % 33 % Q3 FY15 Q3 FY16 9M FY15 9M FY16 % Share Q3 FY15 Q3 FY16 % Share 9M FY15 9M FY16 Gross Box Office 67.1% 67.5% Gross Box Office 67.4% 68.3% Food & Beverages 18.5% 19.2% Food & Beverages 19.2% 20.0% Advertising 9.6% 8.6% Advertising 7.7% 6.8% Other Operating Revenues 4.8% 4.7% Other Operating Revenues 5.7% 4.9% Note: * Revenue from Operations In Rs. Mn 16 COMPANY OVERVIEW Q3 & 9M FY16 – KEY OPERATIONAL METRICS FOOTFALLS AND OCCUPANCY RATE FOOTFALLS AND OCCUPANCY RATE - COMPARABLE PROPERTIES 31% 32% 28% 28% 27% 28% 29% 27% 42.0 34.8 32.6 30.3 11.6 12.9 11.6 12.1 11 % 29 % 4 % 15 % Q3 FY15 Q3 FY16 9M FY15 9M FY16 Q3 FY15 Q3 FY16 9M FY15 9M FY16 Footfalls (Mn) Occupancy (%) Footfalls (Mn) Occupancy (%) Footfalls with Management Properties – Q3 FY16: 13.4 mn, 9M FY16: 43.5 mn AVERAGE TICKET PRICE (ATP) (RS) AVERAGE TICKET PRICE (ATP) (RS) OF COMPARABLE PROPERTIES 180 175 179 174 166 171 164 169 2 % 3 % 3 % 3 % Q3 FY15 Q3 FY16 9M FY15 9M FY16 Q3 FY15 Q3 FY16 9M FY15 9M FY16 All the above charts exclude managed properties.

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