The Inox Group Companies
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CONTENTS ABOUT US 4 At a Glance 8 Our Pride of Parentage 10 Our Operating Metrics 12 Our Report Card 16 Our Presence Across India 17 Our Brand Partnerships 18 Board of Directors 20 Leadership Team 22 Indian Film Exhibition Industry & Multiplex Opportunity 26 Perfecting Luxury & Technology: INOX’s Complete Film Viewing Experience 28 Corporate Information REPORTS 29 NOTICE 38 BOARD’S REPORT 69 MANAGEMENT DISCUSSION & ANALYSIS 74 CORPORATE GOVERNANCE REPORT 92 BUSINESS RESPONSIBILITY REPORT FINANCIAL STATEMENTS 100 Standalone Financial Statements 168 Consolidated Financial Statements 239 Route Map Step Into The 2 Annual Report 2017-18 www.inoxmovies.com About Us Reports Financial Statements STARLIGHT… with INNOVATION. GROWTH. OPULENCE. Innovation in film INOX is one of the INOX has a 360O technology is at the largest multiplex strategy to ensure forefront of INOX’s operators in India with our multiplexes mission to deliver 128 properties, 512 are destinations of a premium viewing screens and 1,25,508 opulence. experience. seats in 64 cities and 19 The introduction of INOX’s states as on date. new signature experience- INOX has redefined the way INSIGNIA has surpassed cinema is viewed in India Over the last decade, INOX the expectations for a luxury with the best & the latest in has aggressively scaled film viewing experience. technology. up its presence through organic and inorganic At INOX, Our premium multiplex expansion. We expect the watching a movie will never properties, state-of-the-art momentum to continue on be just that, technology, unmatched the back of a strong content but so much more. service and ambience, along release pipeline. We have with strong partnerships an encouraging outlook With offerings like a Master with leading brands gives us for capacity expansion, Chef curated menu, Butler- a competitive edge in the substantiated with signed on-Call service, interactive marketplace. agreements for new screens. screens & new applications for mobile devices, etc., Working to add 12 Sitting back on a Italian- properties with 59 screens leather recliner is just the and 10579 seats during cherry on top. FY2019. Our key focus during FY2019 will be to further improve all our revenue streams to ensure bottom-line improvement. INOX Leisure Limited Annual Report 2017-18 3 AT A GLANCE We are pioneers of the multiplex concept We look back at an exciting in India and one of India’s leading multiplex operators. and action-packed year that saw the big screen entertain A portfolio comprising of 128 multiplexes, millions of people. Driven by 512 screens in 64 cities with a seating capacity of 125,508 makes us a truly pan- an encouraging box office India multiplex chain. performance and on the back A mix of organic and inorganic expansion of a strong content pipeline, has enabled us to have an entrenched we expect the momentum position in the domestic multiplex to continue. industry and emerge as one of the largest multiplex players in India with approximately 11% market share in domestic box office collections. 4 Annual Report 2017-18 www.inoxmovies.com About Us Reports Financial Statements INOX Leisure – In a Nutshell Our Service Levels Strong management team belonging to a recognised and trusted group 7 star experience with Well diversified distribution of unmatched service and ambience multiplexes across India Premium multiplex properties, with state-of-the-art technology High level of hygiene Unmatched service and ambience Access to wide variety of regional Curated and wide variety of F&B content Strong partnerships with approximately 100 leading Indian and Interactive & paperless ticketing global brands Interactive menus Butler on Call Kiddles: Fun zone for children Plush ergonomic recliners with USB charging port and ample leg space Consistently high service standards INOX Leisure Limited Annual Report 2017-18 5 ` 25.5 Billion Market Capitalisation (As on March 31, 2018) (Source: BSE Website) ` 114 . 6 Crs. Profit After Tax 533 Lakhs Number of Patrons in FY18 61 Cities As of 31st Mar’18 INOX is one of India’s largest multiplex chains in the cinema exhibition industry, with a wide presence and strong ability to deliver growth. 6 Annual Report 2017-18 www.inoxmovies.com About Us Reports Financial Statements All our properties benefit from a strong ` 1348.1 Crs. Revenue from Operations management team, premium technology, and unmatched service and ambience. 121,573 Seats As of 31st Mar’18 123 Properties As of 31st Mar’18 492 Screens As of 31st Mar’18 19 States INOX Leisure Limited Annual Report 2017-18 7 OUR PRIDE OF PARENTAGE We are a subsidiary of Gujarat Fluorochemicals Limited, a part of the US$ 3 Billion INOX Group with a rich lineage of diversified and successful businesses. The INOX Group is a family owned, professionally The Group includes three public-listed companies managed business group, with market leadership – Gujarat Fluorochemicals Limited, INOX Leisure in diverse businesses including Industrial Gases, Limited and INOX Wind Limited. Engineering Plastics, Refrigerants, Chemicals, Cryogenic Engineering, Renewable Energy and Entertainment. It employs more than 10,000 people at more than 150 business units in India and has a distribution network that is spread across more than 50 countries across the globe. 02 Part of the US$ 3 Billion INOX Group with Diversified Businesses 01 90 year track record of ethical 03 business growth Diversified, professionally managed 04 group More than 150 business units across India, employing more than 10,000 people 8 Annual Report 2017-18 www.inoxmovies.com About Us Reports Financial Statements THE INOX GROUP COMPANIES LISTED COMPANIES GUJARAT INOX LEISURE INOX WIND FLUOROCHEMICALS LIMITED LIMITED LIMITED Largest producer of (by One of the largest Fully integrated player in volume) chloromethane, multiplex chain in India the wind energy market refrigerants and In the business of setting State-of-the-art Polytetrafluoroethylene up, operating and manufacturing plants near in India managing a national chain Ahmedabad (Gujarat), Una of multiplexes under the (Himachal Pradesh) and in brand name ‘INOX’ Madhya Pradesh, which is Present in 64 cities with one of the largest in Asia 128 multiplexes and 512 Ability to provide end-to- screens end turnkey solutions for wind farms OTHER KEY COMPANIES INOX AIR INOX INDIA PRODUCTS LIMITED PRIVATE LIMITED 50:50 joint venture with Air Largest producer of Products Inc., USA cryogenic liquid storage Largest producer of and transport tanks in industrial gases in India India 40 plants spread Offers comprehensive throughout the country solutions in cryogenic storage, vaporization and distribution engineering Has operations in India, USA, Netherlands and Brazil INOX Leisure Limited Annual Report 2017-18 9 OUR OPERATING METRICS AS ON FY18 61 Cities 492 Screens 12 9 EAST 99 72 EAST WEST WEST NORTH NORTH 18 OUTH 102 OUTH 22 S 219 S 123 Properties 121,573 Seats 18,805 23 19 EAST 22,937 EAST WEST WEST NORTH NORTH 26,037 29 OUTH OUTH 52 S 53,794 S Average Ticket Price (`) Up 8.2% Over FY18, our average 195 ticket price increased 193 by 8.2%, advertisement 190 revenue increased 185 by 44.4%, and other 180 178 operating revenues 175 increased by 9.4%. 170 FY2017 FY2018 10 Annual Report 2017-18 www.inoxmovies.com About Us Reports Financial Statements Other Operating Revenue Up % Advertisement Revenue Up % ( ` Crores ) 9.4 ( ` Crores ) 44.4 102 150 101.0 100 140 138.9 98 120 96 100 96.2 94 80 92 92.3 60 90 40 88 20 86 0 FY2017 FY2018 FY2017 FY2018 Food & Beverages Net Contribution to Spend Per Head (`) Up 7.3% Revenue ( % ) 77 67 76 76 75.7 66 66 75 65 74 64 73 63 72 62 62 71 70 61 69 60 FY2017 FY2018 FY2017 FY2018 INOX Leisure Limited Annual Report 2017-18 11 OUR REPORT CARD Our growth in high quality cinema properties and emphasis on excellent customer service are the key factors that have propelled positive operating results for us over a long term. Our standing as one of the leading multiplex players in the country is backed by high quality revenues, excellent operational delivery standards and an encouraging content pipeline. Financial Highlights: Revenue ( ` Crores ) PAT and PAT Margins ( ` Crores ) 7.0% 8.5% 2.5% 4.8% 2.2% 1,348.1 114.6 1,220.7 1,160.6 81.0 895.4 762.8 36.9 30.6 20.0 FY14 FY15 FY16 FY17 FY18 FY14 FY15 FY16 FY17 FY18 PAT PAT Margin% 12 Annual Report 2017-18 www.inoxmovies.com About Us Reports Financial Statements The focus has been on consistent and profitable growth as well as effective execution of strategy. This has led to delivering a sustainable financial performance, while navigating a challenging business environment over the year. Return Metrics ( % ) EBITDA ( ` Crores ) and EBITDA Margin ( % ) #18.8 16.0 13.7 16.3% 12.0 15.6 16.8 14.9 210.4 13.2 189.1 11.5 10.3 146.1 122.0 122.7 7.3 6.1 5.7 3.8 FY14 FY15 FY16 FY17 FY18 FY14 FY15 FY16 FY17 FY18 ROCE ROE EBITDA EBITDA Margin (%) # includes Tax write back pertaining to earlier years of ~` 54crs INOX Leisure Limited Annual Report 2017-18 13 OUR REPORT CARD Operational Highlights: Footfalls and Occupancy Rate CAGR 8% F&B Net Contribution (%) 29% 28% 25% 26% 28% 534 537 533 76.0% 75.7% 386 411 FY14 FY15 FY16 FY17 FY18 FY17 FY18 Footfalls Occ % Average Ticket Price (`) (ATP) CAGR 5% Operational Metrics 193 178 193 170 178 156 164 66 62 53.7 53.3 FY14 FY15 FY16 FY17 FY18 Average Ticket Average F&B Footfalls Price (`) Spend (`) (Million) FY2017 FY2018 Spend Per Head (`) (SPH) CAGR 8% Revenues- Segment Breakup ( % ) 61.3 59.5 66 62 55 58 49 23.3 22.7 7.9 10.3 7.6 7.5 FY14 FY15