ClubMahindra February 8, 2019 MHRIL/SE/ 2018-19/537 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 Dalai Street Bandra (E), Mumbai - 400 051 Mumbai — 400 001 Scrip Code: MHRIL Scrip Code: 533088 Dear Sir, Sub: Investors Presentation Ref. No.: Our letter No. MHRIL/SE/2018-19/535 dated February 6, 2019 With reference to above and pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 ("SEBI Regulations"), please find enclosed the presentation to be made to the Investors / Analysts during the meet scheduled to be held on February 8, 2019. The aforesaid presentation is also being hosted on the website of the Company, www.clubmahindra.com in accordance with the Regulation 46 of the SEBI Regulations. Kindly take the same on record. Thanking you, Yours faithfully, For Mahindra Holidays & Resorts India Limited Dhanraj Mulki General Counsel & Company Secretary Encl: as above Mahindra Holidays & Resorts India Limited Corporate Office : Mahindra Towers, Floor, 'A Wing, Dr. G. M. Bhosle Marg, P. K. Kurne Chowk, Worli, Mumbai - 400 018 22 3368 4721 t: + 91 22 3368 4722. f: + 91 Registered Office: Mahindra Towers, 2"° floor,17/18 Patullos Road. Chennai - 600 002 t +91 44 3988 1000 f : + 91 44 3027 7778 e: memberrelations@clubmahindra.com / w: www.clubmahindra.com / CIN: LS 5101TN1996PLC036595
Dis isclaimer ▪ This note has been prepared exclusively for the benefit and internal use of the recipient and does not carry any right of reproduction or disclosure. Neither this note nor any of its contents maybe used for any other purpose without the prior written consent of Mahindra Holidays & Resorts India Limited. ▪ In preparing this note, we have relied upon and assumed, without any independent verification, the accuracy and completeness of all information available from public sources or which was otherwise reviewed by us. ▪ This note contains certain assumptions, which Mahindra Holidays & Resorts India Limited considers reasonable at this time and our views as of this date and are accordingly subject to change. Computations adopted in this note are indicative and are based on current prevailing market prices and general market sentiment. No representation or warranty is given by Mahindra Holidays & Resorts India Limited as to the achievement or reasonableness or completeness of any idea and/or assumptions. ▪ This note does not purport to contain all the information that the recipient may require. Recipients should not construe any of the contents herein as advice relating to business, financial, legal, taxation, or investment matters and are advised to consult their own business, financial, legal, taxation and other advisors concerning the company. ▪ This note does not constitute an offer for sale, or an invitation to subscribe for, or purchase equity shares or other assets or securities of the company and the information contained herein shall not form the basis of any contract. It is also not meant to be or to constitute any offer for any transaction
Contents 3
Business Model Target Profile of CMH 25 Member Club Mahindra (CMH 25) Flagship Product Offering Strategic Priorities Product Portfolio Strengthen & Leverage Grow Member Base Brand Bliss for 50 CMH 25 Create Marquee resorts in year+ Age Member Engagement unexplored destinations group Maximize Lifetime Value Drive Operational of members Efficiency 4
Sales Network and Revenue & Cost Model Cost Model Sales Network • 117 branch offices, sales offices & channel partners • ASF funds maintenance, renovation of resorts & • Leads generated through Digital route, Referrals, member servicing Alliances, On-ground Events/Activities, Campaigns • Share of pull based Digital & Referral leads stable at the 48-50% levels in FY17-FY18 Revenue Model • Vacation Ownership Income • Resort Income • Admission Fee • Room • Entitlement Fee • F&B • Income from Upgrades • Holiday Activity • Annual Subscription Fee • Spa & Wellness • Interest on Instalments 5
Unique Business Model 6
Unique Business Model Zero Debt Status Unique Consistently High Business Strong Balance Sheet Occupancy Model 7
Unique Business Model - Strong Balance Sheet IND AS 115 Deferred Strong Asset Strong Cash Receivables Revenue Base Position Rs. 5,196 Cr Rs. 1,792 Cr Rs. 521 Cr Rs. 1,792 Cr Provides Opportunity for 59 Resorts Organic Growth Visibility of Inorganic can be met Revenues growth through without relying Includes Land Securitization Assets on External Of Rs. 1,125 Cr Debt * Figures as on Dec 31, 2018 8
Uniq ique Busin iness Model l - Consistently Hig igh Occupancy 5,000 100% 85% 85% 82% 81% 4,000 80% 3,472 3,152 2,879 2,816 3,000 60% 2,000 40% 1,000 20% - 0% FY15 FY16 FY17 FY18 Room Inventory (Units) Occupancy % High occupancy in resorts at 80%+ even with growing Inventory 9
Uniq ique Busin iness Model l - Zero Debt (Standalone) Status Self-Funded Model Capex requirements for Membership Fee from Used to Fund Building New Resorts Members Room Inventory (Units) Cash & Equivalent (in Rs Crs) 4,000 3,540 600 3,472 521 3,152 470 2,879 500 2,816 3,000 400 265 2,000 300 200 1,000 84 100 26 - - FY15 FY16 FY17 FY18 YTD FY15 FY16 FY17 FY18 YTD Dec'18 Dec'18 Cash Position Strong at Rs. 521 Cr as at 31 st Dec’18 aided by focus on high-quality memberships with more conservative payment plans, involving higher down payments and fewer EMIs 10
Leadership Position in in Vacation Ownership 11
Le Leadership Position in in Vacation Ownership 2.47 Lakh+ Member Choice of 59 Full base Trusted Brand service resorts for Track record of over Members two decades Significant Recurring Income Member Engagement streams/Revenue Visibility 12
Resort Div iversity Hill Stations Beaches Backwaters ▪ ▪ ▪ Manali, Shimla, Naldhera, Kandaghat Varca, Emerald Palms, Acacia Palms - Ashtamudi Goa ▪ Kumarakom ▪ Dharamshala, Kanatal, Binsar, Mashobra ▪ Cherai ▪ Poovar ▪ Mussorie, Naukuchiatal, Srinagar ▪ Pondicherry ▪ Allepey ▪ Munnar, Ooty, Kodaikanal, Coorg, Yercaud, ▪ Ganpatipule Wayanad ▪ Srilanka ▪ Gangtok, Baiguney, Kalimpong, Darjeeling, Namchi ▪ Mahabaleshwar, Lonavala, Hatgad Wildlife Forts & Heritage Cities ▪ ▪ ▪ Corbett Kumbhalgarh Cochin ▪ ▪ ▪ Gir Udaipur Nadiad ▪ ▪ ▪ Kanha Jaisalmer Dubai ▪ ▪ ▪ Thekkady Jaipur Kuala Lumpur ▪ ▪ Jodhpur Singapore ▪ Dwarka Bangkok Kuala Lumpur ▪
Member Engagement In In Resorts & Cit ities Heart-to-Heart Dreamscapes Curated Vacations Exchange Program • • • • Festivals & theme-based In-city meets include Wide variety of in-city Creating choice of vacation experiences for leisure & edutainment experiences especially destinations for members at attractive activities for members members for a Fee curated for members prices • Members can exchange • • 10,000 members 2,400+ experiences room nights for stays in participated in FY18 available in 50 cities top-rated hotel chains in India & abroad Mobile App Video/Social Media Resort Campaigns Cruise Experiences • • Created video content on • Mobile app has become Curating special • Preferential pricing & our resorts, offerings & preferred platform of itineraries with activities room night exchange for experiences engagement for & events in some resorts cruise experiences members e.g. ‘White Winters’ • Increasing Social Media • Available on popular • presence for engagement, Use of Analytics for cruising routes in South positive online sentiment & personalised Asia and South East Asia faster complaint resolution recommendations 14
Transition to IND AS 115 15
Transition to IN IND AS 115 – Im Impact on Revenue & Cost Ind AS Ind AS VO Income VO Income 115 18 60% non refundable admission fee Recognized over the tenure of recognized upfront, 40% of Entitlement membership Fee deferred over tenure of membership 30% Ind AS Ind AS Cost 115 Cost 18 Ind AS 115 Direct Costs are charged to P&L as Costs are charged to P&L as and and when incurred & when incurred ONLY incremental costs to obtain the contract are amortized over the tenure of membership 16
Transition to IN IND AS 115 – Ill Illustrative Example As Per IND AS 18 (60:40) As Per IND AS 115 (Spread over 25 years) Particulars FY18 Particulars FY18 New Members New Members ~18,000 ~18,000 (Units) (Units) Avg. Realization Avg. Realization ~3.5 ~3.5 (Rs. Lakh) (Rs. Lakh) 60% Revenue Recognized in FY18; 40% over tenure of membership 4% Revenue Recognized in FY18; 96% over tenure of membership Particulars FY18 FY19 FY20 FY21 ………. FY42 Particulars FY18 FY19 FY20 FY21 ………. FY42 Cum. Cum. Revenue (Rs. Cr) 378.0 10.5 10.5 10.5 10.5 Revenue (Rs. Cr) 25.2 25.2 25.2 25.2 25.2 630 630 Deferred Revenue Deferred Revenue 252.0 241.5 231.0 220.5 ……. 0 604.8 579.6 554.4 529.2 …….. 0 (Rs. Cr) (Rs. Cr) 17
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