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August 2015 Investor Presentation Index Executive Summary Key Company Milestones Industry in Growth Phase Key Differentiators Capturing the Entire Value Chain Location Count Teaching Methodology
August 2015
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Executive Summary Key Company Milestones Industry in Growth Phase Key Differentiators Capturing the Entire Value Chain Location Count Teaching Methodology Growth Strategy Experienced Management Team Financial Overview and Operating Leverage Shareholding Pattern
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Mahesh Tutorials – a 27 year old brand; Coaching services being provided by Mr. Mahesh Shetty since 1988 under the brand name ‘MAHESH TUTORIALS’ Operates under three business verticals – School, Science and Commerce; Diversified product
Entrance Exams (including IIT Entrance), exams for CA course and MBA aspirants Network consists of 136 coaching locations in 7 states/union territories including Maharashtra, Karnataka, Tamil Nadu, Gujarat, Punjab, Haryana and Chandigarh 53,383 students serviced in Q1 FY16; Total headcount strength of 2,500+ with 1,200+ faculty members Focus on result oriented quality coaching with technology enabled classrooms and digitized content and emphasis on teacher training through intensive workshops Experienced management team consisting of senior professionals having strong background in academics and administration Asset light business model with negative working capital Shareholding pattern (as on June 2015 ): ~52.4% held by Promoter/Directors/KMPs and ~32% held by DIIs/FIIs/Bodies Corporate
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First Branch of MT Setup
1988 2001
Introduction of Science Coaching for XI and XII Introduction of Commerce Coaching for XI and XII
2003 2007
PE Investment of USD 8mn by Helix Investments Company for expansion in Mumbai
2009
Introduction of Technology Aided Teaching (TAT)
2011
Acquisition of 51% stake in Chitale’s Personalised Learning Pvt. Ltd.
2012
Listing in April 2012; Acquisition of 51% stake in Lakshya Forum for Competitions Pvt.
2013
Inauguration of Mahesh PU College at Mangalore
2014
Tie-up with Sri Gayatri Educational Society in Telangana and A.P.
2015
Learning Management System (LMS) Launch
8 24,418 40,187 75,629 2006-07E 2010-11P 2014-15P Market Size - Classroom based coaching industry
13% CAGR 17% CAGR Rising disposable income Increasing household spend
Infra bottlenecks for formal education Increasing private sector participation Growth in addressable market INDIAN EDUCATION SYSTEM Informal Education Vocational Education Formal Education
Open & distance learning Multimedia in Pvt Schools ICT in public schools Play School Higher Education K-12 Coaching Classes
The Indian coaching industry is expected to grow from Rs. 40,187 crore in 2010-11 to Rs. 75,629 crore in 2014-15.
Strong structural factors aiding the growth of this sector
A large market opportunity
Source: Crisil Source: Crisil Source: Websites of JEE, IIT Delhi, AIEEE, MHRD, Annual report of ICAI, Maharashtra Directorate Of Medical Education and Research
1,325,936 1,061,566 769,929 1,065,100 468,240 282,096 135,617 574,259 120,195 100,151 80,077 400,000 800,000 1,200,000 MSB Higher Secondary CBSE Xth CBSE XIIth AIEEE IIT JEE 2011 Com Ent Exams, Mah. All India Pre Med/Pre-Dental Test… CA CPT CA PCC CA IPCC CA Final
Organized and Diversified Player Large Pool of Quality Faculty Members Result Oriented Quality Methods
Corporatized Structure and Experienced Management Team
No one man show or ‘Star Teacher’ concept
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Well Recognized Brand & Experience 7th AIR in IIT JEE Advanced ; 4th AIR in AIPMT 55 scored ≥ 90% in HSC Exam in Science; 123 scored ≥ 90% in HSC Exam in Commerce 2,230 scored ≥ 90% in Xth Std. SSC Exam; 1st in Mumbai in SSC 98 locations in Mumbai
June 30 , 2015
Currently operates 38 locations in Rest
T.N., Gujarat, Karnataka , Punjab, Haryana and Chandigarh 1,200+ faculty members 300+ faculty Post Graduates (CA, MBA, B.Ed) Multiple faculty teaching each subject Continuous training Increased visibility amongst governments and international educational institutions Listed status makes it easier for fund raising Scientific coaching methods and system Focus on conceptual knowledge and holistic development Technology to supplement coaching via LMS, TAT and Robomate
June 30, 2015
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CA Final
CA IPCC, MBA Entrance (CAT & CMAT) Entrance Exams – CA CPT, CS Foundation JEE Mains, JEE Advanced (IIT) and NEET
IX & X (All Subjects – SSC, ICSE & CBSE)
Science Section Commerce + UVA Section Others School Section
XIth and XIIthstandard Test prep for the engineering and medical entrance examinations (JEE Mains and JEE Advanced, NEET) XIth and XIIthstandard CA-IPCC , CA Final, CA-CPT Skill Development Coaching for MBA Entrance i.e. CAT, CET Government Programmes IXth and Xth standard Maharashtra, Gujarat, Karnataka State Board CBSE ICSE Sale of Digital Content under ‘Robomate ‘ brand
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In the Secondary and Higher Secondary School Pursuing graduate degrees Undertaking CA examinations.
Preparing for various competitive examinations
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v 98 12 16 3 3
FY
Q1 FY 16 136 FY 15 128 FY 14 136 FY 13 122 FY 12 114 FY 11 103
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Historical No. of Locations over the years
Career Counselling: Through seminars and exhibitions Symphony: A mix of music, yoga and diet controlling techniques to reduce stress, enhance memory and improve communication skills. Hum Se Poocho: A 24 hour helpline during exam time Counselling Sessions: To facilitate communication between the teachers, students and parents on the students’ requirements.
Value Added Services
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Personalized attention by way of regular parent teacher meetings, day-to-day assistance, doubt solving during exam time Teaching with the help of digital content developed in-house by expert faculties after extensive brain storming Increasing focus on assessments, learning management systems Exhaustive test series with mock board exams Superior study material developed along with Chetana Publications for School section (MKeys) State of the art infrastructure facilities at the centers
Implementing Flipped Classroom
Student studies at home & comes with basic preparation Teacher teaches in the classroom Discussion, Learning &Evaluation happens in the classroom
passive earlier
control pace due to self learning
through a state of the art Learning Management System (LMS)
skills and critical thinking
Advantages
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Focus on National Level Exams
and expansion with college tie-ups offering test prep in college campuses
light with lower infrastructure spend
Asset light college tie-ups
entrance and professional examinations such as CA, IIT JEE Advanced, JEE Mains, CAT, CMAT, CBSE etc.
Rest of Maharashtra for School and Science section
in North India, Karnataka, Andhra Pradesh and Telangana for Science and Commerce
Geographical & Vertical Diversification Robomate
sale of digital content for higher scalability
geographies across India
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Overall market trend moving towards IX-X Combo, IX-X Combo admissions up from ~2,000 in FY 09 to
~7,000+ Focus on developing the CBSE & ICSE business verticals as a pillar of strength to enable rapid scalability of
Our unique product “Robomate” with entire content in digital form developed in-house by our faculties from the school section already launched for this academic season and has received a good response from
year 2015-16 Expansion in Maharashtra outside Mumbai with expanding in current cities like Pune and Kolhapur Tie up with local coaching classes in tier-III and tier-IV towns in Rest of Maharashtra and Gujarat for sale of Robomate to their students and providing TAT and teacher training. 16 such tie ups concluded and revenue started in FY 15-16.
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JEE Advanced coaching in North India carried out through a wholly owned subsidiary, Lakshya Forum for Competitions Pvt. Ltd. Robomate for JEE Advanced completed 7th All India Rank in JEE Advanced and 4th All India Rank in AIIMS (AIPMT) expected to generate positive response in North India market About Lakshya:
for IIT and medical entrance examinations
currently operates from 4 locations in Punjab and Haryana
With importance now being provided to Boards
and JEE Mains for admission into the IITs/other engineering institutes and JEE Mains becoming a common engineering entrance exam across states, this new exam pattern plays to the advantage of Mahesh Tutorials Science.
Coaching for JEE Advanced (IIT Entrance Exam) in
Mumbai under the brand ‘Lakshya’ launched in FY 13-14 Lakshya now expanding to Pune, Kolhapur and Nashik Promising admissions growth from 330 initially in 2013 to 1,000+ in current year Launch of Foundation courses (for Std. VIII-X) in Mumbai to act as feeder for JEE Advanced batches Plans to launch JEE Advanced coaching in Karnataka in the next academic session
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The Karnataka Pre-University (PU) College Tie-up Model is one of the most important growth areas under
the Science vertical. Today, ‘Mahesh PU’ brand is a well recognised brand in the state of Karnataka. Standard PU College Revenue Sharing Model:
respective college trust State of the art PU college at Mangalore with a capacity of 3,000 students ready. Hostel facility with a planned capacity of 900 students. Mangalore PU College campus acts as a proof of concept and is instrumental in all college tie-ups 14 operational college tie-ups across Karnataka, at Mangalore, Udipi, Tumkur, Hubli, Bengaluru (3), Kolar, Dharwad, Chitradurga, Davangere, Belgaum, Mysore and Gulbarga 4 additional tie ups done for FY 15-16 Proposing to tie-up with total 30 colleges by 17-18
Revenue Streams
Mangalore Other PU Colleges
Services rendered in a standard PU College:
entrance examinations in college premises after college hours; every college student is a student enrolled with MT Educare for test prep
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Focus on expanding MT Educare’s reach in the CA coaching market throughout India
Chennai developed as a “Centre of Excellence” for CA with being a nerve centre for strategizing growth in South India market. Excellent quality teaching and technology enablement has resulted in growth in students serviced to 7,060 in FY 15. Specialized batches for CA oriented and other students with focussed attention for Std. XI-XII Combo are gaining traction in Mumbai and Pune. Acts as a feeder for admissions in CPT / IPCC. Expanding into South India through CA video classrooms via own centres and Franchisees. Commerce Robomate Updates: Robomate for CA Final - Recorded live lectures of expert faculties and doubt solving support launched E Commerce portal offering sale of Robomate for CA-CPT and IPCC Std. XI and XII Robomate ready for launch
Has over 29 years of experience and holds a bachelor’s degree in science and education. His foresight of delivering quality education consistently with unique innovation ahead of the market has resulted in MT Educare being the premier institution in the Education sector and a household name. He was awarded the ‘Pride of the Nation Award’ by the All India Achievers Association in the year 2008
Mahesh Shetty (Chairman and MD)
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A Non Independent, Non Executive Director of our Company. He has been associated with our Company since its
the education sector. He was instrumental in establishing a culture of training and development in MT Educare.
Naarayanan Iyer (Non Executive Director)
Has over 20 years of experience in various sectors such as education, media, healthcare, constructions and manufacturing and has played a major role in corporatizing MT Educare , strategizing expansion plans of the Company and establishing it as a leading education services provider Holds a multidimensional education qualification in the fields of allied medical sciences, law and management being the alumni of IIM Calcutta
Chhaya Shastri (Non Executive Director)
A fellow chartered accountant and holds a bachelor’s degree in commerce Has 18 years of experience in the field chartered accountancy and taxation. She is a partner of Bansi S. Mehta & Co., B. S. Mehta & Co., and BSM Associates, Chartered Accountants. Her guidance and acumen on taxation matters has added significant value to MT Educare.
Drushti Desai (Independent, Non Executive Director)
Holds a bachelor’s degree in engineering from VJTI, Mumbai and a master’s degree in management studies from Jamnalal Bajaj Institute of Management Sciences, Mumbai. Has over 27 years of varied experience in sales, marketing, business development and general management across industries. He specializes in corporate training and consults corporates on growth strategies.
Yatin Samant, (Independent, Non Executive Director)
Holds a master’s degree in marketing management and a doctorate degree in physical chemistry from the Institute of Technology Mumbai. Has over 20 years of experience in various capacities in industry and academics. He is presently, the Dean - management education & assistant vice president (training & development) with Reliance Infrastructure Limited, a Reliance ADAG
systems and processes. Uday Lajmi (Independent, Non Executive Director)
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Anish Thakkar (Business Head- Commerce Section ) Chandresh Fooria (Business Head- Science Section ) Sujeet Koyoot (Business Head- Karnataka ) Murali Subramanian (Business Head- School) Shrenik Kotecha (Business Head- UVA) A rankholder Chartered Accountant with over 18 years of experience. He was responsible for starting the Commerce wing of the company and adding various offferings including the Higher CA Wing. Has completed his graduation in engineering with over 20 years of experience in the field of teaching and
greater heights and into a formidable position in the industry today. A post graduate in science with over 15 years of experience in the field of teaching and administration. He has contributed significantly towards company’s expansion in Karnataka and has established Company’s brand in Pre University college tie ups Holds a bachelor’s degree in engineering (electronics) and has over 15 years of experience across various segments within MT Educare . He is responsible for steady growth in the School section in Mumbai and has led its expansion into Rest of Maharashtra. Holds MBA degree and master’s degree in commerce . He is the co-founder of MT Commerce and the youngest Business Head of the company. He is spearheading company’s initiatives in the area of Skill Development. Vipul Shah (Head – Brand Development and Procurement) Holds a bachelor’s degree in computer engineering and masters degree in marketing management. He heads marketing and procurement for the company and is instrumental in introducing new systems and processes across various verticals of the company.
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Mahtab Khan (Head- CSR ) Parag Chitale (Business Head - MBA) Yagnesh Sanghrajka (Chief Financial Officer) Ashwin Patel (Company Secretary and Compliance Officer) Holds a master’s in business administration (MBA) from Jamnalal Bajaj Institute of Management Studies (JBIMS). A Founder – Promoter of Chitale’s Personalised Learning Pvt. Ltd. (CPLPL), he is responsible for the MBA piece of the business . Has over 20 years of experience especially in the services sector, in financial strategy planning, investor relations, management information reporting and corporate finance. Before joining the Company, worked with large corporate houses (Hinduja Group) and a leading PE firm Handles Finance & Accounts, Investor Relations and Acquisitions / Tie-ups A member of the Institute of Company Secretaries in India and has a bachelor’s degree in law. He has over 20 years of rich experience in the corporate field . Handles Secretarial and Legal function for the company. Holds a bachelor’s degree in science and education and a post graduate degree in science (electronics). Has been associated with the company since incorporation and has spearheaded the CSR activities
Revenue (INR Mn) EBITDA (INR Mn) PAT (INR Mn) Networth (INR Mn)
832 1,055 1,306 1,573 2,018 2,270 500 1,000 1,500 2,000 2,500 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15
125 190 231 293 425 466
15% 18% 18% 19% 21% 21%
0% 10% 20% 30% 200 400 600 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15
EBITDA EBITDA Margins
52 81 132 180 210 258 6% 8% 10% 11% 10% 11% 0% 10% 20% 100 200 300 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15
PAT PAT Margins
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30 411 476 571 1011 1120 1257
13% 17% 23% 18% 19% 21%
0% 10% 20% 30% 500 1,000 1,500 FY 10 FY 11 FY 12 FY 13 FY 14 FY 15 Networth RoE
FY 10-15: 22 % CAGR FY10-15: 38% CAGR FY10-15: 30% CAGR
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INR in Lakhs
Particulars For the quarter ended 30th June 2015 For the quarter ended 30th June 2014 For the year ended 31st March 2015 Fee Income 6,403 5,221 20,890 Other Operating Income 1,081 208 1,808 Total Revenue 7,484 5,429 22,699 Cost of Goods Sold 36 4 98 Direct Costs 4,111 2,856 11,269 Personnel Costs 851 648 2,946 SD&A Costs 1,466 1,116 3,728 EBIDTA 1,019 805 4,659 Finance Costs 33 83 402 Depreciation & Amortization 354 346 1,279 Other Income 216 125 708 PBT 847 502 3,686 Income Tax 243 164 1,168 PAT (Before Minority Int.) 605 338 2,518 Minority Interest 2 (38) (67) Adjusted comparable PAT 603 376 2,584
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FY 16 FY 15 Revenue 2,651 1,690
Serviced* 10,300 10,111 Science FY 16 FY 15 Revenue 2,016 957
Serviced* 21,741 11,961 Commerce & UVA ( includes Skill Development ) FY 16 FY 15 Revenue 2,662 2,433
Serviced* 21,342 22,038 School *No. of Students Serviced represents students coached for a course during the period under consideration. While a student is included in the no. of students serviced from the start of the course, the corresponding revenue for that student is accrued evenly over the course duration. Thus, the revenue recognized for the student builds up as the financial year progresses which is reflected by the annual average fee realization per student being higher than the average fee realization for the interim periods. The average fee realization per student serviced for the period under consideration is not comparable with the average fee realization for the full year. Q1 FY 16 Q1 FY 15 Total Students Serviced 53,383 44,110 (Revenue - INR in lakhs) Includes revenue from Science (Mah), Karnataka, Lakshya (Mumbai and North India) Robomate revenue & count are included in respective divisions.
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(3,870) (4,899) (4,961) (3,403) (3,607) (6,000) (5,000) (4,000) (3,000) (2,000) (1,000)
FY 11-12 FY 12-13 FY 13-14 FY 14-15 INR in Lakhs Advance Fees
INR Mn FY10 FY11 FY12 FY 13 FY 14 FY 15
Total Operating Income 8320 10550 13060 15728 20180 22700 EBITDA 1250 1900 2310 2930 4230 4660 EBITDA Margins 15% 18% 18% 19% 21% 21% Profit Before Tax 700 1280 1920 2540 3200 4073 PBT Margin 8% 12% 15% 16% 16% 18% PAT 520 830 1320 1800 2100 2583 PAT Margins 6% 8% 10% 11% 10% 11% Networth 4110 4760 5710 10110 11200 12573 Growth Rate 13% 16% 20% 77% 11% 12% Capital Employed 4110 5210 5710 10110 11200 12573 RoE 13% 16% 23% 18% 19% 21%
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(INR in lakhs)
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43% 10% 26% 5% 16%
% Share-holding
Promoter & Promoter Group Directors/Top Management Mutual Funds / FI /FII / Banks Bodies Corporate Large / Small Individual Investors
Category % Share-holding Promoter & Promoter Group 42.8 Directors/Top Management 9.6 Mutual Funds / FI /FII / Banks 26.1 Bodies Corporate 5.5 Large / Small Individual Investors 16.0 Total 100.0
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