S Chand And Company Limited · NSE:SCHAND
S Chand And — Investor Presentation (July 2018)
55 slides from S Chand And's investor presentation, Jul 17, 2018
Slide 1: Leading the Education Revolution in India
LEADING THE EDUCATION REVOLUTION IN INDIA
Slide 2: Welcome to the 1st Analyst Meet
Welcome to the 1st Analyst Meet at Trident Hotel, BKC, Mumbai 17th July 2018
Slide 3: Agenda for the Evening
Agenda for the Evening 1. Welcome , Key Management Introduction 2. S. Chand Group Corporate Video 3. Strategy & Business – Mr. Himanshu Gupta (MD) 4. Future of Education- Mr. Ashish Gupta - (Head Business Development & New Digital Initiatives) 5. Financial Highlights – Mr. Saurabh Mittal, CFO 6. Q &
Slide 4: S. Chand Group Corporate Video
S. Chand Group Corporate Video
Slide 5: Strategy & Business
Strategy & Business Mr. Himanshu Gupta - Managing Director
Slide 6: Large Addressable Opportunity
LARGE ADDRESSABLE OPPORTUNITY US$90 BN Market Size for the Indian Education Sector 6 US$6 BN Ancillary Education Segment Early education 2 Informal Education Segment S. Chand operates in this segment (K-12/ Higher Education content). Test prep 5 5 o US$20 BN ➢ Supports formal and informal education
Slide 7: Indian Education Sector: Inflection Point, Strong Potential
INDIAN EDUCATION SECTOR: INFLECTION POINT, STRONG POTENTIAL Age-wise population distribution in India : S. Chand target market Literacy rate improving with higher participation from students (Source: IBEF Report) (Source: Technopak’s Outlook on India Schooling Segment) 500 40% 450 Potential Market o
Slide 8: Preference Towards Private, Central Curriculum Schools
PREFERENCE TOWARDS PRIVATE, CENTRAL CURRICULUM SCHOOLS Private schools market share increasing every year Indian K-12 education infrastructure (Source: IBEF Report) 120% (Source: Technopak’s Outlook on India’s Schooling Segment) Number of Schools: 1.5 MN 100% 20.0% 21.2% 21.5% 22.1% 23.0% Government
Slide 9: Preference Towards Private, Central Curriculum Schools
PREFERENCE TOWARDS PRIVATE, CENTRAL CURRICULUM SCHOOLS Target Market is 3,00,000 schools – growing at 8-10 % annually and student strength growing at 7-8% • Currently covering 38,000 schools in the target market • Target market growing at 8-10% annually in the no. of Intl 25-300 Schools schools Scho
Slide 10: India Expected to Follow China Trend in Education
INDIA EXPECTED TO FOLLOW CHINA TREND IN EDUCATION CHINA 2006 INDIA 2017 • GDP per capita US$ 2,100. • GDP per capita US$ 1,940 • Private education market < US$ 50 Billion*. • K-12 market growing at ~ 20%. • Private education market ~ US$ 30 Billion*. • Education market expected to double to US$ 180
Slide 11: Leader in Indian Education Content
LEADER IN INDIAN EDUCATION CONTENT Delivering content, services and solutions… ➢ Long operating history of over seven decades. ➢ Offerings spanning entire the ➢ High brand equity across multiple brands. education spectrum …across the ➢ Strong author relationships. education o Early learning continuu
Slide 12: Testimonials
TESTIMONIALS Principals • Mr. Harish Luharuka, Director – Academics Universal Group, Mumbai • Ms. Sunita Gandhi, Founder & Chief Academic Advisor, City Montessori School, Lucknow Channel Partner • Malik Books, Delhi
Slide 13: Business Segments
BUSINESS SEGMENTS K-12 Higher Education Early Learning Revenue 80% of FY2018 revenues 18% of FY2018 revenues 2% of FY2018 revenues contribution 40% revenue CAGR (2012-2018) 9% revenue CAGR (2012-2018) Test prep (>18 years) Target Segment School students (4 -18 years) College students / professionals
Slide 14: Growth Anchored by Leadership in K-12 Segment
GROWTH ANCHORED BY LEADERSHIP IN K-12 SEGMENT Growth Strategy ❖ Consolidated leadership in CBSE/ ICSE schools as preferred content provider. 5,378 ✓ More offerings in K-12 through multiple brands. ✓ Curriculum management. 6,355 5,427 ❖ Geographical diversification in large 3,898 regional markets/ st
Slide 15: Powerful Brand Connect
POWERFUL BRAND CONNECT Connecting with Learners • Art of Book making tour of the Printing Facilities • Mystudygear App • Social Media Connecting with Teachers with • Teacher Conclaves and Awards • Over 2000 Workshops • The Progressive Teacher magazine Connecting with School Leadership • Best Practic
Slide 16: 3-Pronged Strategy
3 – PRONGED STRATEGY 2 Leverage Reach & Expand ACCELERATE • Expand into regional markets through strategic ACQUISITONS & DIGITAL alliances/ acquisitions. INITIATIVES • ”Phygital” to broaden reach and improve outcome. • Expand digital & service offerings to new geographies and segments. 1 Maintain Le
Slide 17: Leverage Reach & Expand – Strategic Alliances / Acquisitions
LEVERAGE REACH & EXPAND – STRATEGIC ALLIANCES / ACQUISITIONS STRATEGIC ALLIANCES / ACQUISITIONS • Strengthen penetration in the CBSE, ICSE Schools and expand into regional markets. • Made multiple successful acquisitions in the past, integrating companies with S. Chand Group philosophy • Alliances w
Slide 18: Digital Initiatives – Complementing Core Business Through Phygital
DIGITAL INITIATIVES – COMPLEMENTING CORE BUSINESS THROUGH “PHYGITAL" Short Multi-media / videos to better illustrate difficult topic to students. • Test preparation and simulated papers for learners to test their understanding. • Students can gauge their performance and better prepare for exams. • M
Slide 19: Digital Initiatives – Synergies to the Core Business
DIGITAL INITIATIVES – SYNERGIES TO THE CORE BUSINESS In-House (Revenue Stream) Digital Investments (Inorganic) • Focused on investing in early stage digital companies. • Offerings include digital classroom learning solutions, • Total investments in digital investee companies is ~Rs.304 learning mana
Slide 20: Future of Education
Future of Education Mr. Ashish Gupta - Head Business Development & New Digital Initiatives
Slide 21: " os
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Slide 22: Welcome to the Future of Education
d Welcome to the Future of Education New Business Initiatives
Slide 23: Jobs of the Future
Jobs of the Future What careers can we expect in years to come? As a kid, what did you want to be when you grew up? A lawyer, doctor or possibly a teacher? In the catalogue of careers will be created as the relationship between man and technology continues to evolve. future, a whole new The children
Slide 24: Farmers and Self-Driving Car Mechanic
~ Farmers will use technology to carefully raise engineered crops, The future of farming is also set to become vertical as creating these spaces in urban areas will help boost food supply. Self-Driving Car Mechanic As the direction of travelling in the future becomes more about self-driving cars, th
Slide 25: Space Tourism Guide, Drone Manager, Neuro Enhancer
Space Tourism Guide Drone Manager In the future, a specialist will be trained to organise, maintain and direct a fleet of drones. Neuro Enhancer
Slide 26: Time Broker, eSport Athlete, Virtual Teacher
Time Broker In the future, time bonking assumes time is more valuable than money. We will be able to deposit our time for completing tasks to. get rewards in return. This is great for freelancers as they will make up 40% of the workforce by 2020. eSport Athlete Players are signed to world clubs, and
Slide 27: Seems Unreal?
Seems Unreal ?
Slide 28: The Journey to Tomorrow
The Journey to tomorrow Early Learning Revolutionize Early Learning by providing “ Pre Early School in a Box” – an integrated program with Learning Material, Digital Content And activities K-12 - India’s leading Virtual Reality content provider linked to curriculum - India’s first integrated content
Slide 29: smartK: Pre School in a Box
Vision : Pre School in a Box smartK Nuri Nori NCERT Based Early International digital and activity Learning Curriculum based early learning program 4 hours / day ~30 Min / day 20 days / month 20 days / month 10 themes 10 Themes Ages : 3+, 4+ Ages : 3+,4+
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Slide 31: The Journey to Tomorrow
The Journey to tomorrow Early Learning Revolutionize Early Learning by providing “ Pre Early School in a Box” – an integrated program with Learning Material, Digital Content And activities K-12 - India’s leading Virtual Reality content provider linked to curriculum - India’s first integrated content
Slide 32: Explore the VR Lesson
EXPLORE THE VR LESSON
Slide 33: VRX: Virtual Reality
VRX : Virtual Reality Edweek, Jan 2018 1. The next wave of technology adoption in U.S. schools will be virtual reality “class kits,” 2. More than 15 percent of U.S. schools are forecast to have a VR class kit by 2021 3. More than 70 million K-12 students are expected to have a VR experience in schoo
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Slide 35: Vision: India's Largest VR Library Based on Curriculum
Vision : India’s largest VR library based on curriculum 2018 2019 2020 2021 Class 9,10 6,7,8 3,4,5 11,12 Go to Market Book+ Book+B2C Book+B2C+International
Slide 36: IED (Integrated Education Destination)
IED( Integrated Education Destination)
Slide 37: IED: NextGen Digital Solution
Can be accessed by NextGen Digital Solution! student on ANY device! IED Single Learning Destination Mat Scie h nce Practice Practice Aligned to School Curriculum Soci Engl al ish Practice Practice App for “All the Learning Needs” of a student
Slide 38: The Netflix of Education
Unique & Differentiated Proposition The “Netflix” of Education Subscription based access to unlimited content Practice & Teacher Assessments Functionality Extensive library of videos & animations School Aligned Study Tools Total On-demand eBooks Access (i.e. on any device, anytime, anywhere)
Slide 39: Potential to Disrupt the Market
Potential to disrupt the market IED offering is significantly differentiated and compelling offering 1. On demand access to unlimited content 2. Go-To-Market – through partner schools & book bundling and free app upgradation 3. Access to ebooks of Group companies 4. Role for teachers 1. Automated ho
Slide 40: Go to Market: Leverage Our Captive Base
Go to Market : Leverage our captive base myStudygear DS Digital Mylestone Print Books Active Users Schools Students 5 Cr 5 lac + 1000+ 50,000+ downloads • Ad and bundling in • Start with tapping • Incremental INR 1000 • Upgrading the free print books urging the Schools with greater from students opt
Slide 41: The Journey to Tomorrow
The Journey to tomorrow Early Learning Revolutionize Early Learning by providing “ Pre Early School in a Box” – an integrated program with Learning Material, Digital Content And activities K-12 - India’s leading Virtual Reality content provider linked to curriculum - India’s first integrated content
Slide 42: Competition Exam: Market Right for Disruption
Competition Exam : Market Right for Disruption Practice Test / Mock Test : 2 Cr + Units per Year Read Questions on Books Answer on the Phone Real Time Analysis Detailed Explanation Instant Score and All India Rank
Slide 43: Test Coach Mobile Mock Test Series
= = @ ay ‘S.CHAND a Test Coach 8 Mobile Mock Test Series Fie > G Test Coach Mobile Mock Test Series he Mobile oN lf Mock Tests ‘ | FIRST TIME 15 Mobile Mock Tests WY r4 4 My coach helped me become Indian Captain, - ~ =one~9 gf Saurav Ganguly Real time Analysis IIA-3M2 LW/Od 44eg Sdal Read from BOOK
Slide 44: Asset Light Model / Minimal Investments / Collaboration
Asset Light Model / Minimal Investments / Collaboration / Quick to Market Early Learning 1. 10 year exclusive license for India on exclusive basis 2. All content localizations and investments by Sigong Media over last 3 quarters Virtual Reality 1. No in house team /resources 2. Work on hire project
Slide 45: The Future of Education
The Future of Education
Slide 46: Financial Highlights
Financial Highlights Mr. Saurabh Mittal - CFO
Slide 47: Performance – FY 2017-18
PERFORMANCE – FY 18 + 18% yoy + 21% yoy + 73% yoy INR 31.1 Revenue growth Ebidta growth PAT growth Earning Per Share FY 2017-18 FY 2017-18 FY 2017-18 FY 2017-18 Summary : Consolidated FY 2018 FY 2017 YOY% FY 2017 Figures in INR Mn Audited Proforma* Audited Total Revenues 8,072 6,868 18% 6,622 Ebidta
Slide 48: Performance Trend
PERFORMANCE TREND Increasing Contribution of K-12 to Group Revenues. Revenue Growth = Organic Growth + Acquisitions. Early learning K12 Higher Education Other Revenue 6 - Year CAGR : 29% 1,403 1,224 1,282 1,237 6,355 7,945 1,345 5,427 6,833 3,898 4,785 5,407 3,378 3,710 2,173 2,816 1,746 FY2014 FY20
Slide 49: Improving Margin Profile
IMPROVING MARGIN PROFILE Improving Margin Profile • Economies of scale • Production Efficiency • Rationalization of Royalty • Improved realization from DEBs • Operating Leverage
Slide 50: Quarterly Business Cycle – Nature of Our Business
QUARTERLY BUSINESS CYCLE – NATURE OF OUR BUSINESS 7% to 8% Revenues 4% to 5% Revenues 8% to 9% Revenues 77% to 80% Revenues Negative WC Negative WC Peak Inventory Peak Receivables Q1 April - June Q2 July - September Q3 October - December Q4 January - March o Content revision/ development o Sample di
Slide 51: Quarterly Working Capital Cycle
QUARTERLY WORKING CAPITAL CYCLE Working Capital • Almost all sales of K-12 business (comprising 80% of total sales) are triggered largely in Q4 to match with school calendar implying high debtors and days for Q4 quarter / year end. However, the recoveries begin in Q4 and are completed by Q3 of the f
Slide 52: Capital Allocation
CAPITAL ALLOCATION ------------------------- FY 2017-18 -------------------------- Inorganic Strategy 5 – Year Goal Standalone Digital Assets Consolidated Consolidated Goodwill On 28.7%* + INR 1,280 Mn Consolidation = 19.1%* 25% INR 3,290 Mn Publishing -ve EBIT ROCE ROCE ROCE Phigital + Digital Digi
Slide 53: In Summary
IN SUMMARY IN SUMMARY • With the GROWTH of ASPIRATIONS and INCOME, Indian education industry is poised for LONG TERM GROWTH in MARKET OPPORTUNITY AND OVERALL PIE • S. CHAND – SUPER BRAND in its market segment, well poised to LEVERAGE the OPPORTUNITY • Over next 5 years, we aspire to • Remain the pre
Slide 54: S. Chand Group
— —— S.CHAND GROUP www.schandgroup.com
Slide 55: Disclaimer
Disclaimer This presentation and the following discussion may contain “forward looking statements” by S. Chand & Company Limited (“S. Chand” or the Company) that are not historical in nature. These forward looking statements, which may include statements relating to future results of operations, fin
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