Slide 0 - Eros International

Corporate presentation
June 2015
1
Eros the leading Indian film studio
Leading Global Indian Film
Entertainment Company
Largest Indian film content library of 2,000+ films

Film content across Hindi & regional languages

Subtitled / dubbed content in 25+ different languages

Multi-channel global distribution in 50+ countries

Parent Eros International Plc is the 1st Indian Media & Entertainment company to
be listed on NYSE Euronext
Revenue
PAT
2,471

(Rs. in million)
FY10
826
210+ new releases over the last 3 fiscal years
14,410

Strong Financial Track Record(1)
6,535
Premier co-producer, acquirer and marketer of Indian
language films globally
FY15
FY10
FY15
Diversified Revenue Mix FY2015(1)
Theatrical
38.0%
Overseas
30.7%
Television
& Others
31.3%
(1)
Fiscal year ended March 31
PAGE 2
Content is King
New film mix
60-70 films
each year
Co-production
Acquisition
Trinity
Pictures
•Hindi
•Regional language
2,000+ film library
(1 year after Theatrical Release)
PAGE 3
Leading Theatrical Market Share
Participation in Average 3 of the Top 10 Releases in India Each Year(1)
$23.3m
$16.5m
$8.8m
Leading Market Share in United States(2)
Others
16%
Eros
32%
Fox
4%
Reliance
12%
$25.7m
$24.5m
$19.3m
YRF
14%
$14.5m
$20.4m
$19.8m
UTV
22%
Leading Market Share in United Kingdom(2)
Other
15%
$17.4m
$ 32.2m
$19.9m
Fox
5%
Eros
35%
Reliance
11%
$22.8m
$ 18.5m
$15.8m
YRF
14%
UTV
20%
(1) Includes films only distributed internationally by Eros. 3 of the Top 10 grossing Hindi films in CY’10 (Source: BoxOfficeIndia.com); 4 of the Top 10 Hindi films in CY’11 (Source: BoxOfficeIndia.com); 2 of the
Top 10 Hindi films in CY’12 (Source: bollywoodhungama.com); 4 out of top 10 Hindi releases in CY’13 (Source: bollywoodhungama.com); 3 out of top 10 Hindi releases in CY’14 (Source:
bollywoodhungama.com). Rupees converted to USD at average annual exchange rate.
(2) Represents market share of all theatrically released Indian language films 2011-2014 (Source: Rentrak)
PAGE 4
Successful Multi-Platform Content
Monetization Model
New Release Content(1)



Library Content
Co-production: Perpetual copyrights
Acquisition: 15 – 20 year rights
Trinity Pictures: Perpetual copyrights
Theatrical


TV Syndication
Digital
SVOD / VOD
2,000+ Industry-leading, extensive and
valuable library of films
Attractive multi-platform rights
Music /
Publishing
Ancillary

In-flight
entertainment

DVDs
Radio
Hotels



Note:
(1)
Ringtones
Companies shown above are a selection of the Company’s relationships
Typical terms for new release content
PAGE 5
A Vertically-Integrated Studio
Content
Aggregation
Co-production
Studio Model
Superior
Financial
Strength
Monetization
India
Theatrical
Deep Multidecade
Talent
Relationships
Acquisition
Trinity Pictures
Proven
Capabilities
In Global
Marketing &
Distribution
TV
Syndication
Prudent Risk
Mitigation
Strategies
India’s
Largest
Content
Library
Digital
Music /
Others
Overseas
$
Theatrical
TV Syndication
Freemium
Pay Per View
Subscription
Advertising
IPR Creation – Concept to Library Exploitation
PAGE 6
Maximize Monetization Through
the Release Windows
The Company operates a de-risked business model
• Monetization starts prior to the theatrical release
• Stable source of revenue through library monetization
• Multiple windows, existing and emerging, increase potential upside
Pre-Sales Window
Digital Exploitation
Ancillary including post-release
music
Pre-Prod /
Planning /
Casting /
Scripting
Principal
Photography
PostProduction /
Completion
Music
Release
Theatrical
Release
(TR)
DTH
Eros
Library
DVD Distribution
Satellite TV Licensing
18 months
before TR
12 months
before TR
6 months
before TR
3 months
before TR
Theatrical
Release
3 months post TR
1 year post TR
PAGE 7
2
Our markets
Indian Media & Entertainment
Market
Media & Entertainment Market Projected to Grow at 14%(1)
1,964
1,740
397.7
1,532
1,330
204.0
161.3
386.8
170.7
8.0%
358.0
155.6
331.9
136.3
126.4
10.0%
186.3
236.1
195.0
19.8%
341.1
289.8
1,159
1,026
’14 – ’19 CAGR
307.1
284.5
263.4
474.9
543.2
2014A
2015P
631.2
2016P
TV Print
739.6
2017P
Film Other (2)
854.6
2018P
975.5
15.5%
2019P
(1) Source: FICCI-KPMG Report 2015.
(2) “Other” includes radio, music, out of home, animation & VFX, gaming and digital advertising segments
PAGE 9
India: High Growth and Attractive
Fundamentals
One of the Fastest Growing Economies(1)
Increasing annual disposable income(2)
Projected GDP growth rate (%) for FY16
(Rs. In billion)
115,860
7.5%
6.3%
108,459
100,499
96,954
3.1%
2.3%
India
China
US
UK
Highly favorable demographics(2)
2012
2013
2014
2015
Attractive Market Fundamentals
Median age
38.9
36.7
30.7
27.0
Growing Middle Class
Increasing Discretionary Income
Russia
China
Brazil
India
(1) IMF World Economic Outlook as of April 2015
(2) FICCI-KPMG 2014 & 2015 Report
PAGE 10
Expanding Theatrical Market
Should Benefit Eros
India is a Highly Underpenetrated Market…(1)
Theatre screens per million population
…Fueling Growth in the Indian Film Industry(1)
125
Indian film industry revenue outlook
85
(Rs.in billion)
204
61
57
126
7
India
Germany
UK
France
US
2014A
…with Increasing Multiplexes & Ticket Prices(2)
…with substantial room to increase pricing(3)
Number of films with box office revenues
9
5
1
(Rs.)
Average Admissions Price
976
6
5
3
2
2019E
2
292
1
373
435
491
Brazil
Russia
US
603
44
2009A
2010A
2011A
> INR 1 bn
(1)
(2)
(3)
2012A
> INR 2 bn
2013A
2014A
India
China
UK
Japan
> INR 3 bn
Source: FICCI-KPMG Report 2015
Source: FICCI-KPMG Report 2013, 2015
Magna Global, June 2014
PAGE 11
Growing Indian Television Market
Increasing television household penetration…(1)
Status of Digitization in India(1)
TV Household Penetration (%)
61%
Total # of
Households:
71%
2014
2019E
168m
196m
Phase
…is Expected to Fuel Growth in the Indian TV
Industry (1)
Parliamentary approval Digital cable
Digitisation
for analogue shutdown STBs rolled out including DTH
Phase 1
Jun-12
~ 8 mn
98%
Phase 2
Mar-13
~14 mn
90%
Phase 3
Dec-15
~3 mn
40-50%
Phase 4
Dec-16
...is Supported by Favorable Viewing Preferences(1)
(Rs in billion)
45%
975
475
676
320
55
299
2014A
2019P
Advertising Revenue
1)
70+%
18%
11%
Subscription Revenue
Hindi GEC +
Movies
Regional
Channels
Kids + Music
7%
News
Source: FICCI-KPMG Report 2015
PAGE 12
Compelling Digital Opportunity
Internet penetration is still in early stages(1)
90%
Strong Expected Internet-enabled Smartphone
Growth(1)
(in million)
87%
435
369
53%
299
46%
249
188
UK
USA
Brazil
China
19%
116
India
2014P
India’s digital ad market to reach c$2.8bn by 2020
Online advertising spend
(Rs. in millions)
172,080
2015E
2016E
2017E
2018E
2019E
Mobile advertising to be largest component
2020 share of online ad spend
(Rs. in millions)
Mobile, INR
53,359
Social Media,
INR 51,618
28,110
Display, INR
12,936
FY' 14
Online ad spend as
% of total ad spend
7%
FY' 20
Search, INR
25,809
Video, INR
25,809
Email, INR
2,612
19%
(1) FICCI KPMG Report 2015, and broker research
PAGE 13
4
A digital opportunity
Digital Revenue Potential through
ErosNow





A subscription-based on-demand entertainment portal with over
14 million registered users in India
Subscribers have access to 10,000+ content offerings including
movies, music tracks, music videos, TV episodes and original
videos
Exclusive film premieres available to all users, including recent
super-hit Tanu Weds Manu Returns
Unlike other OTT (“over-the-top content”) players, Eros owns
much of the content on ErosNow
Tanu Weds Manu Returns
Film Studios
Available on all internet-enabled devices and fully integrated
with the top social media outlets globally
Music Labels
TIMES
music
TV Networks
ErosNow is ideally positioned to capitalise on growing internet penetration and
benefits from high barriers to entry
ErosNow is Eros International Plc’s on-demand entertainment portal
PAGE 15
ErosNow: The Promise of Endless
Entertainment
Music
Movies
Pioneering New Content
Original long-form content
Originals
TV
Original short-form content
 Original programming under
production
 Broad range of genres from fantasy
and adventure to romance and thriller
 Expected launch: FY’ 16
 Initial ErosNow viewing window
followed by wide TV syndication
ErosNow is Eros International Plc’s on-demand entertainment portal
PAGE 16
5
FY’ 15 Financial Highlights
Key Financial Highlights

Strong Track Record of Revenue, EBIT & PAT Growth

Multi-Channel Distribution Diversifies Sources of Revenue

Conservative Balance Sheet

Impressive slate of films lined for FY16 & FY17
PAGE 18
Steady Revenue Growth – growing
catalogue
Diversified Revenue Streams – FY15
Strong Historical Revenue Growth
(Rs. in million)
14,410
10,744
11,396
9,632
6,535
Overseas
31.3%
Theatrical
38.0%
Television
& Others
30.7%
7,159
Catalogue Contribution
Diversified Revenue Streams
22%
FY10
Film by Budget
Type(1)
High
FY10
FY11
FY12
FY11
FY12
FY13
FY13
FY14
FY14
FY15
FY15
3
3
5
6
4
6
Medium
11
10
5
13
21
11
Low
97
64
67
58
44
47
111
77
77
77
69
64
Total
(1)
Films(2)
15%
10%
FY12
12%
FY13
FY14
FY15
High Budget for Hindi films>USD8.5mn, Tamil/Telugu/Regional>USD7mn, Low Budget for all languages <USD1mn and Medium Budget is the intermediate range, 1USD=Rs.61
PAGE 19
Solid Track Record of Profitability
EBIT
PAT
(Rs. in million)
(Rs. in million)
3,616
2,471
2,997
1,997
2,257
2,264
1,613
1,545
1,182
1,213
% Margin
1,491
826
FY10
FY11
FY12
FY13
FY14
FY15
18.6
22.5
23.4
21.1
26.3
25.1
.
FY10
FY11
FY12
FY13
FY14
FY15
12.6
16.5
15.5
14.4
17.5
17.1
PAGE 20
Conservative Balance Sheet
Select Balance Sheet Items
(Rs. in millions)
Commentary
March 31, 2015
Cash
1,735
Total Debt
4,875
Net Debt
3,140
Shareholders’ Equity
 Low Leverage
 Strong Liquidity and Coverage Ratios
14,822
Net Debt / Equity Ratio
0.21
Net Debt / EBIT Ratio
0.87
PAGE 21
6
Appendix
Film Release Profile
Releases in FY’ 16 to date
Release date
Gabbar is back (overseas)
Q1 FY’ 16
Uttama Villain (Tamil)
Q1 FY’ 16
Tanu Weds Manu Returns
Q1 FY’ 16
Masss (Tamil)
Q1 FY’ 16
Aga Bai Arechaa 2 (Marathi)
Q1 FY’ 16
Dil Dhadakne Do (Overseas)
Q1 FY’ 16
PAGE 23
Significant forthcoming releases
Release title
Life of Josootty (Malayalam)
Bajrangi Bhaijaan
Rajini Murugan (Tamil)
Bangistan (Overseas)
Hero
Singh is Bling (Overseas)
Bajirao Mastani
Gabbar Singh 2 (Telegu)
Aligarh
Dictator (Telugu)
Naale (Malayalam)
Perai Thedai Natkal (Tamil)
Enkitta Mothathe (Tamil)
Housefull 3
Shivay
Untitled
Farzi
Banjo
Raabta
Jugaadu
Untitled
Star Cast / (Director/Producer)
Tentative release date
Dileep, Jyothi Krishna, Rachana Narayankutty (Jetthu Joseph)
Q2 FY’ 16
Salman Khan, Kareena Kapoor (Kabir Khan)
Q2 FY’ 16
Sivakarthikeyan (Ponram)
Q2 FY’ 16
Ritesh Deshmukh, Pulkit Samrat, Jaqliene Fernandis(Karan Anshuman)
Q2 FY’16
Sooraj Pancholi, Adheya Shetty (Nikhil Advani)
Q2 FY’16
Akshay Kumar, Kareena Kapoor, Amy Jackson (Prabhu Deva)
Q3 FY’16
Ranveer Singh, Deepika Padukone (Sanjay Leela Bhansali)
Q3 FY’ 16
Pawan Kalyan (K. S. Ravindra)
Q4 FY’16
Kangana Ranaut (Hansal Mehta)
Q4 FY’16
Balakrishna (Srivaas)
Q4 FY’16
Fahad Fazil, Malavika S Mohan, Isha Talwar, Mukesh (Shiju S Bawa)
Q4 FY’16
Ashok Selvan (Abraham Prabhu)
Q4 FY’16
Natarajan Subramaniyam Rajaji and Vijay Murugan (Ramu Chellappa)
Q4 FY’16
Akshay Kumar, Abhishekh Bachchan, (Director-Sajid-Farhad)
FY’ 17
Ajay Devgn (Ajay Devgn)
FY’ 17
Kajol (Ajay Devgan Productions)
FY ‘17
Shahid Kapoor, Kiriti Sanon (Raj Nidimoru and Krishna D.K.)
FY’ 17
Riteish Deshmukh, Nargis Fakhri (Ravi Jadhav)
FY ‘17
Sushant Singh Rajput (Dinesh Vijayan and Homi Adjania)
FY’17
Harman Baweja and others
FY’17
Saif Ali Khan (3 movies)
FY’17
PAGE 24
Important notice and
disclaimer
Certain statements in this presentation concerning the future growth prospects are forward looking statements, which involve a number of risks and
uncertainties that could cause actual results to differ materially from those in such forward-looking statements. In some cases, these forwardlooking statements can be identified by the use of forward-looking terminology, including the terms “believes”, “estimates”, “forecasts”, “plans”,
“prepares”, “projects” “anticipates”, “expects”, “intends”, “may”, “will” or “should” or, in each case, their negative or other variations or comparable
terminology, or by discussions of strategy, plans, objectives, goals, future events or intentions. These forward-looking statements include all matters
that are not historical facts. They appear in a number of places throughout this presentation and include, but are not limited to, statements regarding
the Company’s intentions, beliefs or current expectations concerning, among other things, the Company’s results of operations, financial condition,
liquidity, prospects, growth, strategies, business development, the markets in which the Company operates, expected changes in the Company’s
margins, certain cost or expense items as a percentage of the Company’s revenues, the Company’s relationships with theater operators and
industry participants, the Company’s ability to source film content, the completion or release of the Company’s films and the popularity thereof, the
Company’s ability to maintain and acquire rights to film content, the Company’s dependence on the Indian box office success of its films, the
Company’s ability to recoup box office revenues, the Company’s ability to compete in the Indian film industry, the Company’s ability to protect its
intellectual property rights and its ability to respond to technological changes, the Company’s contingent liabilities, general economic and political
conditions in India, including fiscal policy and regulatory changes in the Indian film industry. By their nature, forward-looking statements involve
known and unknown risk and uncertainty because they relate to future events and circumstances. Forward-looking statements speak only as of the
date they are made and are not guarantees of future performance and the actual results of the Company’s operations, financial condition and
liquidity, and the development of the markets and the industry in which the Company operates may differ materially from those described in, or
suggested by, the forward-looking statements contained in these materials. The forward-looking statements in this presentation are made only as of
the date hereof and the Company undertakes no obligation to update or revise any forward-looking statement, whether as a result of current or
future events or otherwise, except as required by law or applicable rules.
PAGE 25