Corporate Presentation - November 2018 - Eros International
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Corporate Presentation November 2018
1 Eros the leading Indian film studio
Executive Summary
Eros: A global leader in Indian film entertainment with #1 box office market share
1 130+ new releases in the last 3 fiscal years
2 Large content library of Indian language films, 2,000+, and music
3 Multi-platform model for content monetization
4 ErosNow(1) strategically positioned to capture large digital opportunity in India
5 Highly attractive market opportunity driven by secular tailwinds
6 Culture of innovation and partnerships with leading international talent
Note: (1) ErosNow is Eros International Plc’s, OTT entertainment service
PAGE 2
Unrivalled Library & Film
Production Capability
New film •Hindi
mix 40-50 Co-production Acquisition Own IP Creation •Regional language
Films Each •ErosNow Originals,
Year Short films
2,000+ film library
(1 year after Theatrical Release)
PAGE 3
Eros: A Multi-channel monetization
Model
Leading player in a growing and underpenetrated film market
Theatrical Investing in content driven films with high ROI potential
Film pre-sales facilitated by long-standing Eros brand, reputation and industry relationships
Cable digitisation and rising Pay TV penetration drive market growth and demand for premium content
Eros’ film library of over 2,000+ films is a stable source of revenue growth with high margins
Television & Others Television rights are often sold before box-office releases
Other streams through theatrical and catalogue rights include Music, Cable and broadband syndication, in-flight sales,
DVD sales, etc.
Exclusive content supplier to the fast growing OTT platform - ErosNow
Digital ErosNow, with 13m paying subscribers and over 128m registered users globally, is the leading Indian Film SVOD Platform
Expanding aggressively into digital content with ErosNow originals and short films
Sale of international distribution and digital rights to the parent company benefits de-risking and cash flows
Overseas Pre-determined recovery of significant film production cost through Eros International Plc
Parent Company enjoys wide international distribution network across 50 countries
Eros International is strategically positioned to monetise film content through multiple channels globally
$$$ $ AD $
Theatrical TV Syndication Freemium Pay Per View Subscription Advertising Bundled Services
PAGE 4
Deep and Longstanding Talent
Relationships
Select Leading Actors
Amitabh Shah Rukh Salman Ranveer Deepika Priyanka Anushka
Bachchan Khan Khan Singh Padukone Chopra Sharma
3 IIFA Awards 5 IIFA Awards 1 IIFA Award 3 IIFA Awards 4 IIFA Awards 3 IIFA Awards 3 IIFA Awards
4 NFA Awards 2 NFA Awards 1 NFA Award 1 NFA Award
Select Leading Directors
Sanjay Leela Anand Kabir Raj & DK Anurag Sujay
Bhansali L. Rai Khan Kashyap Dahake
4 IIFA Awards 1 BIG Award 1 IIFA Award 2 IIFA Awards 1 NFA Award
2 NFA Awards 1 Stardust Award 1 NFA Award
Note: IIFA = International Indian Film Academy. NFA = National Film Awards.
PAGE 5
Industry defining partnership
with Reliance Industries
⚫ Eros International Media and Reliance
Industries Ltd (“RIL”),India’s largest private A Mutually Beneficial Strategic Partnership with India’s
sector company, announced the creation of Largest Conglomerate to Consolidate Indian Content
a joint film fund to co-produce and
consolidate Indian content Content Distribution Capital Engagement
o The new partnership will look to
invest Rs 1,000 crore ($150mn) in Investment to dramatically scale Eros’ capabilities in content
the near-term to produce and production, marketing, and distribution
acquire Indian films and digital
originals across all languages Symbiotic relationship with Reliance’s Jio to create high efficient
unit economics for the ErosNow OTT platform
⚫ RIL, as per an agreement in February
2018, has acquired 5% equity stake in our Reliance’s production expertise to further bolster expansion and
parent company, Eros International PLC at development of Eros’ original and short form content
a price of $ 15 per share (18% premium to
the then close price)
PAGE 6
Successful Penetration into China,
expansion into new Geographies
Indo-Chinese Co-Production Bajrangi Bhaijaan in China Indo-Turkish Co-Productions
2 films created and produce by
in-house, will be co-produced
with a Chinese Studio
• First for an Indian studio
• Set in India and China
• Shot in both languages
Eros’ Influential Partnership in China
Partnerships with three major Chinese state-owned film and
entertainment companies to promote, co-produce and distribute
Indo-Russian Joint Content Distribution
Sino-Indian films across all platforms in India and China
Central Partnership and Eros Int’l to distribute and promote Indian
and Russian content across multiple platforms in both countries
PAGE 7
2 Our markets
India: Fast Growing Film and
Television Market
Indian Film and Television Market Projected to Grow at 9%
(Rs. In Billions)
’16 – ’20E CAGR
9%
1,054
900 192 7%
816
166
156
9%
862
734
660
2017A 2018E 2020E
TV Filmed Entertainment
(1) Source: FICCI – EY Report.
PAGE 9India: Leading Economic and
Population Growth
Fast growing economy Massive Population
Projected GDP Growth CAGR (2017A-2021E) (2017, in billions)
~18% of world
13.1% population
1.3
3.3%
0.3
India US India US
Highly favorable demographics Increasing annual consumer expenditure
Median age (Rs. billion)
39.3 37.1
31.6 101,146
27.6 83,858 90,016
74,967 80,266
71,324
Russia China Brazil India 2012 2013 2014 2015 2016 2017
Over the next 15 years India is expected to be the largest contributor of global GDP growth
World Bank, IMF, OECD, CIA World Factbook, Euromonitor International, United Nations, Wall Street Research
1. Number of Eros Now subscriptions purchasable in India for each Netflix subscription purchasable in the India. Services’ costs based on Rs.500 Netflix Standard monthly subscription plan for India and Rs. 50
Eros Now monthly subscription plan for India, respectively
PAGE 10Rapid Growth for India’s Film
Industry
More Movies Made, and More Tickets Sold in India Than
India - a highly underpenetrated market
Any Other Country
2,500 (2016A1) Theatre screens per million population
125
Number of Movies
2,000
India
Produced
1,500
1,000 60
Japan USA 40
China
500 France
UK 10 16
South Korea 8
0
0 500 1,000 1,500 2,000 2,500
India Brazil China South UK US
Annual Tickets Sold (mm) Korea
Multiplex rollout fueling growth …and substantial room to increase pricing
Number of Multiplexes in India (Rs.)
Average Admissions Price
1,028
2,750
2,100 635
458 517
1,500 393
1,225 308
925 190
India China Brazil Russia US UK Japan
2009 2011 2013 2015 2017
Eros Plc data, UNESCO Institute for statistics, Film Federation of India, Wall street research - Size of circles scaled to represent Number of Movies Produced x Annual Tickets Sold, FICCI-E&Y
2018 Report, India ticket price represents average ticket price at two leading multiplex chains as on 2017.
PAGE 11Growing Indian Television Market
Increasing television household penetration…(1) …is Expected to Fuel Growth in the Indian TV Industry (1)
(Rs in billion)
Paid C&S TV Household Penetration (%)
862
84%
81%
594 494
351
243 368
Total # of 2016A 2021P 2016A 2020E
TV 175m 200m Advertising Revenue Subscription Revenue
Households:
Willingness to pay for content…(1) ...is Supported by Favorable Viewing Preferences(1)
(in millions)
Paid C&S TV Household Percentage of viewing time spent
45%
42%
36% 70+%
22%
164
12% 11%
147 7% 7%
2016A 2021P Hindi GEC + Regional GEC + Kids + Music News
Movies Movies
2014 2015
1) Source: FICCI Report 2017, 2018
PAGE 12India: Compelling Digital Trends,
Underpinned by Mobile
In December 2017 India Reached 1.2 Billion Mobile Phone Subscribers, with Only 25% Smartphone Penetration
A Young, Technologically Savvy Demographic Strong Mobile Internet User Growth
27% Internet Median Age 87% Internet Millions2
Penetration1 Penetration1
37.9 829
481
27.6
2017A 2021E
Video Dominates Mobile Internet Usage in India A Handful of Telcos Control the Market
Mobile Internet Usage in India (2017E) Wired & Wireless Broadband Market Share (Jun-2018A)
File Sharing
95% Wireless Subscribers
Streaming Audio 2% 48%
10%
21%
14% 10%
Video 5%
49%
→ 75% by 2021E
Web and Other
Data Jio Airtel Vodafone Idea BSNL
39%
Source: FICCI Report, CIA World Factbook, Telecom Regulatory Authority of India, Ericsson Mobility Report, Statista. Note: Vodafone India and Idea Cellular merger pending.
1. 2016A.
2. Includes non-smartphone mobile internet users.
PAGE 13The Big Regional Opportunity
Language No. of films Top Grossing Worldwide Box Typical Typical
released in Film Office INR & Production Print &
2017 USD Budgets Advertising
Hindi 120 Dangal 1,870 cr ($291m) $ 12 -15m $3.0m
Tamil 198 Enthiran 283 cr ($44.2m) $ 10 -12m $0.7m
Telugu 156 Baahubali 2 1,560 cr ($238m) $ 8 – 10m $0.5m
Kannada 183 Aptharakshasa 55 cr ($8.6m) $ 4 – 5m $0.2m
Malayalam 132 Drishyam 75 cr ($11.7m) $ 1.5 – 2.5m $0.2m
Marathi 98 Sairat 110 cr ($16.7m) $ 1 – 2m $0.2m
Bengali 36 Chander Pahar 15 cr ($2.3m) $ 0.5 – 1m $0.1m
Punjabi 40 Chaar Sahebzaade 70 cr ($11m) $ 1.5 – 2.5m $0.2m
Over 1,000 films are released in The box office numbers suggest these are Varying Budgets. Low P&A. High
India each year across languages not niche films. Contributions are significant Margins and Presales
In the context of shortage of theatres, the Regional strategy adds scale, market share and margins without cannibalization
Source: BookMyShow, KoiMoi, Market reports
PAGE 143 A digital opportunity
ErosNow(1) : #1 SVOD Platform for
Indian Content
11,000+
Films Rights
5,000+
Into Perpetuity
100+
Originals over next 18 months
Rapidly Growing Paid Subscriber Base…
Eros now Paying Subscribers2 16.0+
(mm) 13.0
10.1
7.9
5.0
2.9 3.7
2.1
FY'17A Q1' FY'18A Q2' FY'18A Q3' FY'18A FY'18A Q1' FY'19A Q2' FY'19A FY'19E
(Mgmt Guidance)
Eros International produces/acquires content for ErosNow (1)
Note: (1) ErosNow is Eros International Plc’s, OTT entertainment service(2) Paying subscribers means any subscriber who has made a valid payment to subscribe to a service that includes
the Eros Now service either as part of a bundle or on a standalone basis, either directly or indirectly through a telecom operator or OEM in any given month be it through a daily, weekly or
monthly billing pack, as long as the validity of the pack is for at least one month
PAGE 16ErosNow(1) : World’s Leading Indian
Digital Entertainment Platform
✓135
Our Addressable Market is a Quarter of the World Population
Countries inc. India
✓128M
Registered Users
✓13M
Paying Subscribers
✓11,000+
Digital Rights
Note: (1) ErosNow is Eros International Plc’s, OTT entertainment service
PAGE 17ErosNow(1) - Unique distribution
model
Major Indian Telco Partnership Director to Consumer and Other
OEM Streaming
215mm 223mm 345mm 221mm
Subs Subs Subs Subs
(Partner
Channel)
Parent Company Market Capatilization1 $80bn $75bn $26bn $5bn Other
EROS Now Exclusive SVOD Partner
WALLETS
Long-Standing Partnership
TELCO / ISP
➢ Major Indian Telco Partnerships Underpin Sustainability
of ErosNow’s Moat
➢ Exclusive Partnerships for ErosNow, and Access to the
Largest and Most Linguistically Diverse Digital Indian
Film Library for Telcos
International
Note: (1) ErosNow is Eros International Plc’s, OTT entertainment service
PAGE 18Strong pipeline of ErosNow(1)
originals under Production/release
December 2018 / March 2019 March 2019 March 2019
January 2019
April 2019 May 2019 June 2019 June 2019 TBD
Note: (1) ErosNow is Eros International Plc’s, OTT entertainment service
PAGE 193 Forthcoming Content
Select Forthcoming Releases
Tentative
Film Name Star Cast/(Director/Producer) Language
Release
Amar Akbar Anthony Ravi Teja, Ileana D’Cruz and others (Mythri Movie Makers) Telugu FY2019
Ottakkoru Kamukan Jojo, Shine Tom Chacko and others (Dazzling Movie Land) Malayalam FY2019
Kaptan Saif Ali Khan, Zoya and others (Navdeep Singh / ColourYellow Productions) Hindi FY2019
Mumbai Pune Mumbai 3 Swapnil Joshi, Mukta Barve Marathi FY2019
Cobra Gautam Ghulati, Tarun Khanna, Nyra Banerjee, Ruhi Singh, Director - Munesh Rawal Hindi FY2019
Kaamiyab Drishyam Films Hindi FY2019
Ticket to Bollywood Amyra Dastoor, Diganth Manchale / (Eros) Hindi FY2019
Haathi Mere Saathi Rana Dugabatti (Prabhu Soloman) Hindi / Tamil / Telugu FY2020
Guru Tegh Bahadur (Harry Baweja) Punjabi FY2020
Jaita Harman Baweja (Harry Baweja) Hindi FY2020
Untitled Ravi Vasudevan Malayalam FY2020
Untitled Vijith Nambiar Malayalam FY2020
Untitled (Homi Adajania / Maddock Films) Hindi FY2020
Ankhen 2 Amitabh Bachchan & Others Hindi FY2020
Nervazhi Nayanthara (Bharath Krishna) Tamil FY2020
Shubh Mangal Savdhan - 2 (Colour Yellow Productions) Hindi FY2020
Panda (Indo-China) (Kabir Khan) Hindi FY2020
Tannu Weds Manu 3 Anand L Rai Hindi FY2020
Roam Rom Mein Nawazuddin Siddiqui & others (Tanishtha Chatterjee / Rising Star Entertainment) Hindi FY2020
The Body (Overseas) Emraan Hashmi, Rishi Kapoor (Viacom18 Motion) Hindi FY2020
Time to Dance (Overseas) Sooraj Pancholi, Isabelle Kaif (Super Cassettes Industries) Hindi FY2020
- The above list is indicative and subject to change
Strong releases YTD set to be bolstered by additional highly anticipated titles in the coming years
PAGE 21Select Forthcoming Releases
Tentative
Film Name Star Cast/(Director/Producer) Language
Release
Raw (Overseas) John Abraham (Viacom18 Motion) Hindi FY2020
Untitled Kartik Aaryan (Anees Bazmee) (Next Gen Films) Hindi FY2020
Untitled- (Hindi remake of
Kartik Aaryan / Jacqueline Fernandez (Kyta Productions) Hindi FY2020
Kirik Party)
Chandamama Door Ke Sushant Singh Rajput, Nawazuddin Siddiqui (Sanjay Puran Singh) Hindi FY2020
Pitch White (Vipul Shah) Hindi FY2020
Untitled (Rahul Dholakia / Next Gen Films) Hindi FY2020
Heer (Colour Yellow Productions) Hindi FY2020
Fake (Raj & DK) Hindi FY2020
Re-Union (Sujoy Ghosh) Hindi FY2020
Hera Pheri -3 Suniel Shetty and others Hindi FY2020
Phobia 2 (Next Gen Films - Pawan Kriplani) Hindi FY2020
2 Guns (Krishna Jagarlamudi) Hindi FY2020
R. Rajkumar 2 (PrabhuDeva / Next Gen Films) Hindi FY2020
Khalifey Sanjay Dutt, SaifAli Khan, Arshad Warsi (Prakash Jha) Hindi FY2020
Make in India (Next Gen Films) Hindi FY2020
Jugaadu Harman Baweja Hindi FY2020
1234 (Part 2) Suniel Shetty, Paresh Rawal (Ashwni Dhir) Hindi FY2020
- The above list is indicative and subject to change
Strong releases YTD set to be bolstered by additional highly anticipated titles in the coming years
PAGE 224 Financial Overview
H1 FY2019 EBIT up by 26.4%, PAT
higher by 31.7%
Figures in INR million H1 FY2019 H1 FY2018 Growth (%)
Total Income 5,441 5,473 (0.6)%
EBIT 2,033 1,609 26.4%
EBIT Margin 37.4% 29.4% +800 bps
Adj. EBITDA (1)
2,395 1,917 24.9%
Adj. EBITDA Margin 44.0% 35.0% +900 bps
PAT (after minority) 1,363 1,035 31.7%
PAT Margin (%) 25.1% 18.9% +620 bps
Diluted EPS (Rs.) 14.17 10.82 31.0%
• Eros released 31 films (5 medium budget, 26 small budget) & 1 Digital Series in H1 FY2019 as compared to
12 films (1 high budget, 3 medium budget , 8 small budget) in H1 FY2018
• Margin expansion driven by a content - driven films, strong pre-sales strategy and catalogue monetization
1) Adjusted EBITDA is defined as EBITDA adjusted for (gain)/impairment of available-for-sale financial assets, profit/loss on held for trading liabilities (including profit/loss on derivative
financial instruments), transactions costs relating to equity transactions, share based payments, Loss / (Gain) on sale of property and equipment, Loss on de-recognition of financial assets
measured at amortized cost, net, Credit impairment loss, net, Loss on financial liability measured at fair value through profit and loss, Loss on deconsolidation of a subsidiary and
Impairment of goodwill (as applicable).
PAGE 24Conservative Balance Sheet: Leverage
and liquidity improve further
All figures in Rs. Million
Particulars As on Sept 30, 2018 As on March 31, 2018 As on Sept 30, 2017
Cash 2,106 1,872 1,887
Net Debt 5,112 5,557 5,854
Networth 24,936 22,559 21,188
Net Debt / Equity 0.21 0.25 0.28
Net Debt / EBIT 1.25 1.51 1.63
• Eros’ investments are focused on enhancing its position as a premium content owner of Indian film and
digital content while maintaining a conservative balance sheet
• Capital structure, liquidity and coverage ratios improve further and are well within the prescribed norms.
PAGE 25Consistent Profits; strong growth
in margins
Diversified Revenues Streams FY18
Revenue EBITDA PAT
Television
Figures in Rs. million & Others
46.3% Theatrical
16,257
42.8%
14,453
14,410
Overseas
10.9%
11,396
10,744
10,100
9,632
7,159
3,768
3,679
3,615
3,549
2,997
2,575
2,471
2,293
2,257
2,387
2,262
1,997
1,613
1,545
1,478
1,172
FY'11 FY'12 FY'13 FY'14 FY'15 FY'16 FY'17 FY'18
EBITDA (%) 22.5 23.4 21.1 26.3 25.1 21.8 26.1 36.4
PAT (%) 16.5 15.5 14.5 17.5 17.1 14.7 17.8 22.7
PAGE 26Important 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 forward-
looking 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.
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