Zee Entertainment Enterprises Limited · NSE:ZEEL
Zee Entertainment Enterprises — Investor Presentation (June 2018)
35 slides from Zee Entertainment Enterprises's investor presentation, June 2018
Slide 1: Zee Entertainment
Extraordinary Together Zee Entertainment 3600 Entertainment Content Company
Slide 2: Presentation Flow
Presentation Flow India M&E Industry Domestic Broadcast Digital A to ZEE of Content Movies & Music Leadership International Live Events Financials 2
Slide 3: India Media & Entertainment Industry – An Overview
India Media & Entertainment Industry – An Overview TV INR660bn Print Others INR303bn INR157bn CY17: INR1,473bn Films Digital INR156bn INR119bn Music Live Events INR13bn INR65bn Source: FICCI-EY M&E Report 2018 * - Others include Radio, Animation, VFX, Gaming and OOH 3
Slide 4: M&E Industry – An all-round growth story
M&E Industry – An all-round growth story Others CY20e 18% Category CY12-17 CAGR CY17-20e CAGR 15% CY17 Television 12.3% 9.8% Music 10% Print 6.2% 5.7% CY12 3% 8% 42% Films 6.8% 12.0% 14% Share of 45% Digital 11% M&E 45% Digital 40.5% 24.9% Verticals 11% Music 4.2% 10.7% 27% Others* 22.0% 17.6% Films
Slide 5: A to ZEE of Content Leadership
A to ZEE of Content Leadership Domestic Broadcast ➢ Hindi GEC ➢ Regional Entertainment ➢ Hindi Movie Cluster ➢ Niche Channels Digital ➢ ZEE5 Movies & Music ➢ Zee Studios ➢ Zee Music Company International ➢ America ➢ Europe ➢ MENAP & Africa ➢ APAC LIVE ➢ Zee Live ➢ Zee Theatre 5
Slide 6: Domestic Broadcast
Domestic Broadcast 6
Slide 7: Television to continue on the growth trajectory
Television to continue on the growth trajectory Television industry in a secular growth phase Television offers much wider reach than other mediums (INR bn) (monthly reach amongst 12+ individuals) TV - 9.8% CAGR 75% 862 660 594 39% 19% 19% CY16 CY17 CY20e TV Newspaper Radio Internet Source: FICCI-EY
Slide 8: Television market – Revenue composition
Television market – Revenue composition TV Revenue (CY17) INR 660bn Advertising Revenue Subscription Revenue INR 267bn (40.5%) INR 393bn (59.5%) Broadcasters’ Share Broadcasters’ Revenue INR 99bn (25.2%) INR 366bn Distributors’ Share INR 294bn (74.8%) Source: FICCI-EY M&E Report 2018 8
Slide 9: Strong growth in television ad spends to continue
Strong growth in television ad spends to continue Double-digit nominal GDP growth Healthy growth in television ad spends to continue Increasing (INR bn) TV – 11.3% CAGR 368 discretionary spends 243 267 Growth Drivers Increasing share of organized sector New CY16 CY17 CY20e categories like BFSI, Phar
Slide 10: Television distribution value chain – A snapshot
Television distribution value chain – A snapshot PAY DTH Operator Subscribers 52mn PAY Broadcasters Local Cable MSO Subscribers 99mn Operator FTA DD Freedish Viewers 31mn Content flow Source: FICCI-EY M&E Report 2018 Revenue flow MSOs and DTH operators make bouquets consisting of channels of differe
Slide 11: Drivers in place for sustained subscription revenue growth
Drivers in place for sustained subscription revenue growth Digitization Increasing HD penetration Increase in transparency on ARPU of HD packages is account of digitization will help Broadcasters’ Subscription ~2x-3x of that of SD broadcasters in monetization revenue (INR bn) 125 90 99 ARPUs expecte
Slide 12: Complete entertainment portfolio
Complete entertainment portfolio 37 Channels across genres and languages 12
Slide 13: Steady improvement in viewership share
Steady improvement in viewership share Network share across broadcasters, FY18 ZEEL has consistently increased its viewership share 17.1% 17.7% 16.4% 14.9% ZEEL, 18.0% 14.1% 13.1% 11.6% Others, 31.6% Star, 17.7% Viacom, 10.1% Sun, 12.2% Sony, 10.4% CY11 CY12 CY13 CY14 CY15 CY16 CY17 Network share ex
Slide 14: ZEEL - well entrenched in content eco-system
ZEEL - well entrenched in content eco-system Independent production ~500 hours of houses original content produced every week In-house production house ZEEL has library of over 250,000+ hours of content Large number of small production houses with limited risk taking ability ZEEL engages closely wit
Slide 15: Digital
Digital 15
Slide 16: Digital Gaining Momentum
Digital Gaining Momentum Digital is expected to continue its growth momentum Broadband subscriber base driven by mobile 224 429 mn internet users (INR bn) Wired Broadband 119 5.0% 92 3G+4G 2G 71.5% 23.5% CY16 CY17 CY20e Source FICCI-EY M&E Report 2018 Source : TRAI Reports, IIFL Capital Research Dat
Slide 17: ZEE5 – ZEEL's comprehensive digital offering
ZEE5 – ZEEL’s comprehensive digital offering ➢ Intuitive UI ➢ Originals, digital first content ➢ Strong recommendation engine ➢ Strong movie library ➢ Premium content across genres Technology Content Regional Revenue ➢ Regional language UI Focus Model ➢ AVOD ➢ Regional language content ➢ SVOD ➢ TVOD
Slide 18: ZEE5 – An unrivalled content catalogue
ZEE5 – An unrivalled content catalogue ZEE5 Originals ➢Originals in 6 languages ➢New series to be released every month ➢Captivating shows Movies ➢3500+ movies ➢12 languages International Content ➢100+ digital premieres ➢Shows from Turkey, Brazil, Pakistan, Korea etc. ➢Dubbed/sub-titled in multiple I
Slide 19: ZEE5 – Customized for the Indian consumer
ZEE5 – Customized for the Indian consumer UI/UX Innovations ➢ Flexibility to chose display in 11 languages ➢ Option to choose content from 12 languages ➢ Voice search for seamless search experience Technology Customizations ➢ Multiple CDN for smooth streaming experience ➢ Option to download content
Slide 20: Movies and Music
Movies and Music 20
Slide 21: Indian movie landscape changing fast
Indian movie landscape changing fast Rising penetration of multiplexes bodes well for movie Regional movies gaining traction in INR142bn Indian movie producers industry Punjabi Others Number of Multiplex Multiplex screens as % of 8% screens overall screens Bengali 2% 2% 3,000 2,750 35% Marathi 2,500
Slide 22: Zee Studios' approach to movie production
Zee Studios’ approach to movie production SCRIPT DRIVEN ACROSS BUDGETS, ACROSS PROFIT SHARING WITH KEY LEVERAGE PRESENCE LANGUAGES TALENT ACROSS VERTICALS ➢ Strong story-line ➢ Portfolio approach to ➢ Engaging key talent on ➢ Backward integration in ➢ Low dependence on star movie making profit shari
Slide 23: One of the leading movie production studios in India
One of the leading movie production studios in India Hindi Movies Regional Movies Received National Film Award for The Best Actor 23
Slide 24: Zee Music Company – rapidly building its catalogue
Zee Music Company – rapidly building its catalogue Digital consumption of music is driving music industry’s growth Recently acquired Music titles (INR bn) 14.5% CAGR 18.0 12.0 10.6 CY12 CY17 CY20e Source: FICCI-EY M&E Report 2018 Digital contributes upto 70% of the revenues of music labels Zee Music
Slide 25: International
International 25
Slide 26: International – Serving diaspora and local audience
International – Serving diaspora and local audience 39 international channels with 13 channels in 9 non- Presence in 170+ countries with reach of 578mn Indian languages Serves South Asian Diaspora as well as local audience in Gradually expanding in markets with affinity for Indian select countries c
Slide 27: A strong global presence
A strong global presence 39 International Channels 13 Local Language Channels * - Logos relate to ZEEL’s channels catering to local audience 27
Slide 28: Live Events
Live Events 28
Slide 29: Live Events – A growth opportunity
Live Events – A growth opportunity Organized Event Industry market size (INR bn) 109 65 56 CY16 CY17 CY20e Source: FICCI-EY M&E Report 2018 India is opening up to ticketed live events which presents a growth opportunity Zee Live is dedicated to all forms of live entertainment for different kinds of
Slide 30: Financials
Financials 30
Slide 31: FY18 revenue and costs breakdown
FY18 revenue and costs breakdown Revenue breakdown – INR66,857 mn Costs breakdown – INR46,095 mn Others, 6.8% EBITDA, 31.1% Operating , 37.8% Subscription, 30.3% Advertising, 62.9% Admin & Others, 12.5% Employee , 10.0% A&P, 8.6% 31
Slide 32: Strong growth in advertising and subscription revenues
Strong growth in advertising and subscription revenues 42,048 INR mn 36,735 33,652 26,603 23,081 19,639 18,225 15,841 16,302 16,388 13,184 14,240 11,648 9,223 FY12 FY13 FY14 FY15 FY16 FY17 FY18 Advertising revenues Domestic Subscription revenues *ZEEL divested its sports business reflected in FY18 d
Slide 33: Strong and consistent profitable growth
Strong and consistent profitable growth 34.6% 33.0% 33.5% 32.5% 31.1% 30.1% 29.9% EBITDA CAGR 18.8% 29.9% 25.8% 27.2% 25.7% 26.0% 24.3% FY12 FY13 FY14 FY15 FY16 FY17 FY18 EBITDA margins * EBITDA margins (ex-Sports) *ZEEL divested its sports business – Ten Sports Network, in FY17 33
Slide 34: Consistent payout to shareholders
Consistent payout to shareholders Consistent dividend distribution Payout to shareholders is higher than annual equity dividend 31.2% FY12-18 (Cumulative) 63.2% 30.3% 28.4% 26.6% 26.1% 25.2% 21.5% 30.2% 25.7% Equity Equity + Buyback Equity + Buyback + FY12 FY13 FY14 FY15 FY16 FY17 FY18 RPS Equity Eq
Slide 35: Thank You
Thank You
Zee Entertainment Enterprises — Investor Presentation (June 2018) on 6ix