Mahindra Holidays & Resorts India Limited · NSE:MHRIL
Mahindra Holidays & Resorts India — Investor Presentation (May 2021)
53 slides from Mahindra Holidays & Resorts India's investor presentation, May 8, 2021
Slide 1: Cover letter to stock exchanges
4,Ve 4 ClubMahindra May 8, 2021 MHRIL/SE/21-22/13 Listing Compliance Department of Corporate Services National Stock Exchange of India Limited BSE Limited Exchange Plaza, Plot No. C/1, G Block Floor 25, PJ Towers, Bandra-Kurla Complex Dalal Street Bandra E, Mumbai – 400 051 Mumbai – 400 001 Scrip Co
Slide 2: Investor Presentation 8th May 2021
..x.• -.41 01.0' if INDIANS BEST 4t1 I0 FAVOURITE 14 tr. MOST POPULAR %I 1,0 COMPANIES TO 4.11A- 11( 111 k RESORT ill" Yok RESORT V WORK FOR ' F4 CHAIN 3. CHAIN TOP100. 2024 di' HOLIDAY r1:1 AWARD 2917 11141ESTRAVEL AWARD 20 I 9 GREAT PLACE TO WORK' INSTITUTE ahindra Holidays & Resorts India Ltd. In
Slide 3: Outline / Agenda
Outline /Agenda Ae 4CLubMahindm Executive Summary 03 Hospitality Industry 06 Vacation Ownership Industry 12 Our Unique and Resilient Business Model 16 Our FY21 Performance 22 A Strong Er Consistent Performance Track Record 30 Long-Term Value Creation 40 Holiday Club Resorts 47
Slide 4: In a year impacted by a pandemic, we have emerged stronger
In a year impacted by a pandemic, we have emerged stronger CLubMahindra F Expanding Member Base li r p Occupancy Operational Profit 12,031 85% EBITDA grows to Member additions Occupancy in Q4 FY21; 250,000+ Rs. 286 Cr 72% (up 18% YoY) Cumulative Member Base Occupancy in FY21 L_ Liquidity Position Ba
Slide 5: Executive Summary
Executive Summary Ac 4 CLubMahindm A Strong Our Key Long-Term Industry Outlook Performance Differentiators Value Creation Track Record Well Poised to Drive Domestic • Unique and resilient business • Multiple annuity revenue Key Strategic Initiatives to Leisure Travel Demand model streams Drive Consi
Slide 6: Our Financial Metrics Demonstrate the Resilience of our Business Model
Our Financial Metrics Demonstrate the Resilience of our Ae Business Model Predictable Revenue Streams 4CLubMahindm Built-in multiple income streams - Vacation Ownership Income, Annual Subscription Fee 8- Resort Income Deferred Revenue pool of Rs. 5,081 Crs A steady stream of income from a large pool
Slide 7: Hospitality Industry
Ae 4 CLubMahindm Hospitality Industry
Slide 8: Evidence of Green-Shoots of Recovery in the US Travel Industry
Evidence of Green-Shoots of Recovery in the US Travel Industry Indicates Expected Strong Recovery in the Indian Market AP 4 CLubMahindm Accelerated Leisure Travel Recover creased Confidence to Trave Easing of domestic travel restrictions and the faster- US market has witnessed increased demand to fl
Slide 9: We are well-positioned to capture emerging trends in the Indian Hospitality Industry
We are well-positioned to capture emerging trends in the Ve Indian Hospitality Industry A 4 OubMahrridni The pandemic has led to certain trends emerging ... which MHRIL is well placed to capitalize on in the Indian Hospitality industry... TICKET Bounce-back in occupancies post the easing of lockdown
Slide 10: Well-positioned to capture emerging trends in Indian Hospitality Industry continued
We are well-positioned to capture emerging trends in the si Indian Hospitality Industry continued.. Ave CLubMahindm The pandemic has led to certain trends emerging ... which MHRIL is well placed to capitalize on in the Indian Hospitality industry... Iv • • 1 Restaurants, hotels, and recreation cente
Slide 11: Sharp Recovery in Occupancies at our Resorts
Sharp Recovery in Occupancies at our Resorts 4 CLubMahindm 85% 75% Rebuilding Resort Occupancy (Occupancies as a % of operational 30% rooms) 0% J 01 FY21 02 FY21 03 FY21 04 FY21 On easing of lockdown restrictions in With our resorts at drivable distances from Majority of members preferred to stay in
Slide 12: We Differentiate ourselves through High Occupancies and Zero Debt
We Differentiate ourselves from the Traditional Hospitality AV( Players through High Occupancies and Zero Debt CLubMahindm Healthy Cash Flows Upfront While hospitality companies take Zero Debt on debt to fund their capex, we Membership Fees have zero debt Growing and Loyal Member Base [ Multiple Ann
Slide 13: Vacation Ownership Industry
e 4 ClubMahindra Vacation Ownership Industry -410m10.
Slide 14: Global Vacation Ownership Landscape
Global Vacation Ownership Landscape AP 4 CLubMahindm Globally there are 5,000 timeshare resorts • U.S. timeshare industry sales witnessed a CAGR of -7% in 121 countries from $ 8.6 bn in 2016 to $ 10.5 bn in 2019 arket No. of Cu e VO Playe • * ($Bn) Resorts# ember Base In the U.S. there are 1,500 tim
Slide 15: A Large & Attractive Market for Vacation Ownership in India
A Large Er Attractive Market for Vacation Ownership in India fir` CLubMahindm 01 • -3 Crs High-income Households with an annual income > Rs. 275 lakhs expected by CY30 There is a huge potential target market for VO as household • • Rs. 55 Lakh Crs Annual Consumption from high-income households by CY
Slide 16: Growing Demand for Travel
Growing Demand for Travel a 1,e India's Travel Trends Market Trends 4 1 CLubMahindm ■ Domestic Tourist Visits (in mn) • Leisure to lead recovery 1,855 Domestic 1,615 1,653 1,432 • Preference for domestic tourist trips 1,283 1,143 destinations to accelerate have witnessed 1,045 a CAGR of 12% 865 747
Slide 17: Our Unique and Resilient Business Model
ASSONORA Ae 4 CLubMahindm Our Unique and Resilient Business Model
Slide 18: Our Capabilities Built Over 25 years of Our Journey
Our Capabilities Built Over 25 years of Our Journey Ae Creation of marquee resorts in new and unexplored destinations 4 CLubMahindm Choice of 69 Domestic Resorts, 10 resorts in South-East Asia, 9 Associate Resorts in U.S. and 33 Holiday Club Resorts in Europe Manage fully serviced resorts with high
Slide 19: Unique and Resilient Business Model
Unique and Resilient Business Model AP 4 CLubMahindm r Income From • • I I I • • Admission Fee Resort - FIT Resort - Members Annual Subscription Fee al Interest MI Financing i Recurring Revenue Streams : ASF* , Resort Income Value Creation 1 Upfront Admission fees Built- In Multiple Annuity Streams
Slide 20: Diverse set of products targeting multiple customer segments
Diverse set of products targeting multiple customer segments 11111 41 'V CLubMahindni Target Consumer Consumer Preferences Couples with Young Children ▪ Cautious explorers Er comfort CMH 25 – 25 years, 7 nights per year Affluent, NCCS A, travelers 30-40 years of age ▪ Plan vacations in advance ▪ Fin
Slide 21: Our Expanding Destination Network
Our Expanding Destination Network 4 CLubMahindm Holiday Exchange RC l' Program - Club 4,300 Resorts in 69 Resorts in India + 10 in South-East 33 Resorts in Mahindra ‘Horizon’ 110 countries Asia and 9 Associate Resorts in USA Europe 210+ Partner Hotels worldwide 20
Slide 22: We are leading the recovery in the sector
We are leading the recovery in the sector.. Ac 4 CLubMahindm ( We are completely focused on leisure travel and family experiences and are best positioned to benefit from the pent-up demand for leisure travel 01 ( With 69 resorts across India, we are poised to take advantage of consumer preferences f
Slide 23: Our Performance
Ac 4 ClubMahindra Our Performance
Slide 24: Member Acquisitions
Member Acquisitions Ae 4 CLubMahindm 12,031 Nos. Member additions grew 4,789 every quarter.. 2,681 3,291 1,270 mi. A 01 FY21 02 FY21 03 FY21 04 FY21 FY21 • From the start of the pandemic (Apr'20), the customer acquisition team moved to virtual selling • Member engagement activity ('Heart to Heart')
Slide 25: Resort Performance
Resort Performance Ac 4 CLubMahindm 44.6 Resort Income (In Rs. Crs) 6.7 0 01 FY21 02 FY21 03 FY21 04 FY21 • Our resort performance has sharply recovered QoQ and has reached pre-pandemic levels both in terms of occupancies and resort revenues • Our resort income of Rs. 53.1 Crs in Q4 FY21 was higher
Slide 26: Expanding our Inventory Portfolio to 79 resorts
Expanding our Inventory Portfolio to 79 resorts CI .1 bMahincha 4,197 Ranthambore, Alibaug, Assonora, Goa Mount Abu, Netrang, Port Blair, Gujarat Havelock, Neil, In Nos 3,732 Jaipur Andamans Arookutty, Nicobar Island Kerala Alleppey, Kerala Room additions grew at the fastest rate to cross the 4,000+
Slide 27: Domestic Resorts Network
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Slide 28: Enhanced Cost Efficiencies
Enhanced Cost Efficiencies Ac 4 CLubMahindm In Rs. Crs C-17) 273 267 243 P 188 1 145 68 Mr 7 46 Sales Er Marketing Rent 1 Employee Benefit Other Expenses Expenses Expenses FY20 FY21 Significant cost saving measures have resulted in total cost reduction by 22% YoY
Slide 29: FY21 Performance Trend
FY21 Performance Trend Ae 4 CLubMahindtlt Rs. Crs Total Income* EBITDA Margin PBT Margin 1,037 31.5% 909 228 104 18.6% 23.3% 12.0% 809 FY20 I FY21 805 1- FY20 FY21 1 FY20 FY21 Resorts *FY21 was impacted by Covid-19
Slide 30: FY21 Profits
FY21 Profits Ae 4 CLubMahindm Rs. Crs PBT Rs. Crs PAT 169 126 124 92* I FY20 FY21 FY20 FY21 Note: *Before one-time impact due to change in corporate tax
Slide 31: A Strong & Consistent Performance Track Record
dol" ClubMahindra A Strong & Consistent Performance Track Record 30
Slide 32: Large base of loyal and committed members
Large base of loyal and committed members Ac 4 CLubMahindm Fully paid members crossed 200,000+ in FY21 (CAGR of 8% over the FY16-21 period) CAGR Total Member Base 1,99,617 2,18,138 2,35,792 2,43,574* 2,58,336 2,54,4314 5.0% 1,91,615 2,08,967 Fi 1,77,277 1,62,875 1,45,960 1,41,947 Fully Paid Members
Slide 33: Room additions track record
A Strong and Consistent Performance Track Record Ac 4 CLubMahindm Room additions grew at the fastest rate to cross the 4,000+ mark in FY21 • Inventory addition of In Nos 4,197 465 room units in an otherwise challenging 3,732 P year has been the highest, taking our 3,595 3,472 total room inventory 3,
Slide 34: Total Revenue and PBT track record
A Strong and Consistent Performance Track Record AP 4 CiubMattindni Total Revenue CAGR of 10% (FY15-19) PBT CAGR of 23% (FY15-19) In Crs In Crs I I 1,170 I 241 1,090 1,094 I 1,037 964 I 963 201 207 909* 808 168 169 I I I I I P 105 100 124 I I I I FY15 FY16 FY17 FY18 FY19 I FY19 FY20 FY21 FY15 FY16 F
Slide 35: Cash position has improved significantly
A Strong and Consistent Performance Track Record Ac 4 CiubMattindni Cash position has improved significantly In Crs 940 572 470 265 83 26 FY15 FY16 FY17 FY18 FY19 FY21 Despite a challenging environment and continuing capex plans, we have added Rs. 159 Crs in FY21 and Rs. 368 Crs over the last two ye
Slide 36: Multiple Annuity Revenue Streams
Multiple Annuity Revenue Streams AP 4 CLubMahindm VO Income* ASF Income* CAGR of -6% (FY15-19) CAGR of -11% (FY15-19) In Crs In Crs 583 I 291 293 539 545 557 i 261 444 240 210 217 347 345# 173 315 156 FY15 FY16 FY17 FY18 FY19 FY19 FY20 FY21 iI FY15 FY16 FY17 FY18 FY19 1 FY19 FY20 FY21 IndAS 18 IndAS
Slide 37: Multiple Annuity Revenue Streams
Multiple Annuity Revenue Streams Ae Resort Income Interest & Others 4 CLubMahindm Resort Income CAGR of -14% (FY15-19) CAGR of -14% (FY15-19) In Crs In Crs 228* 1 122 220 111 209 109 I 190 173 89 93 80# 132 64 67 104* FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY15 FY16 FY17 FY18 FY19 I FY19 FY20 FY21 IndAS
Slide 38: Revenue Mix
Revenue Mix Ae IND AS 18 IND AS 115 4 CLubMahindm 1°Z. 3% 3% 6% 7% 9% 8% 9% 11% 9% Our cumulative 18% 19% 20% member base provides us with 28% 18% 32% multiple revenue 17% 19% streams such as VO Income, ASF Income, 23% 22% 12% Resort Income, and • Interest Income 56% which contributes to 53% 0% 91%
Slide 39: Growing Profit Margins
Growing Profit Margins Ae 4 CLubMahindm EBITDA Margin PBT Margin 32% 21% 18% 19% 19% 25% 24% 25% 17% 23% 13% 12% 16% 10% FY15 FY16 FY17 FY18 FY19 FY19 FY20 FY21 FY15 FY16 FY17 FY18 FY19 FY19 FY20 FY21 IND AS 18 IND AS 115 IND AS 115 Er 116 IND AS 18 IND AS 115 IND AS 115 £x116 PAT Margin 14% 13% 12%
Slide 40: Supported by a Strong Balance Sheet and Liquidity Position
Supported by a Strong Balance Sheet and Liquidity Position Ac 4 CLubMahindm Rs. 5,081 Cr Rs. 940 Cr Zero debt Rs. 2,143 Cr Income earned This together with Includes Land and deferred as the Accounts Assets per IND AS 115, Receivables book of Rs. 1,145 Cr and this will be of Rs 1,205 Cr excludes IND
Slide 41: Long-Term Value Creation
4 CLubMahindm Long-Term Value Creation
Slide 42: Strategy to Drive Consistent Growth
Strategy to Drive Consistent Growth AP 4 CLubMahindm Accelerate Inventory Addition Improve Operational Efficiencies Grow Cumulative Member Base Deliver Superlative Customer Experience I Strengthen Brand o p Continue Digital 11 Enablers Pull Transformation Enablers II 41
Slide 43: Robust Inventory Addition
Robust Inventory Addition A tp Room Additions 4 ClubMahindra in Nos 5,500+ 4,197 3,595 3,732 3,472 3,152 2,816 2,879 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 FY25 Estimated L Room inventory additions are planned to achieve 5,500+ room units in the next 4 years 42
Slide 44: Accelerate Member Additions
Accelerate Member Additions 4 CLubMahindm Scale up Member acquisition through Referrals, Digital and Alliances Use a multi-product portfolio to acquire members based on life- stage segmentation (Go Zest, CMH-25 and Bliss) P Scale up resort onsite sales teams to acquire new members and upgrade existi
Slide 45: Delivering Superlative Customer Experience
Delivering Superlative Customer Experience Ac 4 aubMahindra Pottery Making Kebab and Biryani Festival Kids Magic Show Yoga Session Rajasthani Theme 44
Slide 46: Digitally Enabled Customer Journey
Digitally Enabled Customer Journey Ae 4 CLubMahindm For Prospects For Members Online Digital Happy Digital Prospect Website Membership Family Referral Onboarding Program Upgrade EGE Referral prompts at Features: Chat — -1• various touchpoints Onboarding, Pre- in the digital purchase, Upgrade, journe
Slide 47: Key Takeaways
Key Takeaways Ae 4 CLubMahindm • We see accelerated demand for domestic leisure travel over the next few years • The VO space will grow faster, and we see potential of significant growth in this decade in an under-penetrated market • We have a resilient business model which has emerged stronger duri
Slide 48: Holiday Club Resorts
1
Slide 49: Business Model & Key Facts
Business Model Er Key Facts a 'VIe 14 CLubMahindni ▪ Holiday Club Resorts is the largest vacation ownership company in Europe and the leading leisure travel company in Finland SAARISELKÄ ▪ Total of 33 resorts - 25 in Finland, 2 in Sweden, 6 in Spain (5 in Gran Canary, 1 in Costa del Sol) SALLA ▪ Pri
Slide 50: Revenue streams
Revenue streams Ae 4 CLubMahindm ❖ HCR has two major business units ▪ Sale of Timeshare o Revenue is generated from timeshare sales either in the form of traditional timeshare weeks or fractional villa sales ▪ Spa Hotel Operations o Revenue generated from Spa Hotels consists of room revenues, food &
Slide 51: Key Highlights
Key Highlights Ac • Holiday Club Resorts is one of the most respected timeshare brands in Scandinavia 4 CLubMahindm • We have been able to significantly reduce the debt on HCR books from Euro 51.7 million as on September 2014, when we first invested in HCR, to Euro 26.0 million as on March 2021 • Th
Slide 52: Outlook
Outlook Ae 4 CLubMahindm ▪ While Covid-19 has impacted the performance, HCR has successfully controlled costs. ▪ We believe that majority of the Finland population would be vaccinated by June'21. ▪ Domestic travel is estimated to recover by mid-June'21 around the holiday season, while international
Slide 53: Thank You
POOVAR KERALA ClubMahindra Z = S Thank You 52
Mahindra Holidays & Resorts India — Investor Presentation (May 2021) on 6ix