Music Broadcast Limited Investor Presentation May 2017 Safe Harbor - PDF document

Music Broadcast Limited Investor Presentation May 2017

Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Music Broadcast Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment what so ever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company. This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded. Certain matters discussed in this Presentation may contain statements regarding the Company’s market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performance of the industry in India and world-wide, competition, the company’s ability to successfully implement its strategy, the Company’s future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company’s market preferences and its exposure to market risks, as well as other risks. The Company’s actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes no obligation to update any forward-looking information contained in this Presentation. Any forward-looking statements and projections made by third parties included in this Presentation are not adopted by the Company and the Company is not responsible for such third party statements and projections 2

Benefiting from Profitable Growth Strategy CAPEX for all 11 ~36% for 28 Net Cash of Rs. Stations done Stations 145 Crs Maintenance ~34% for 39 Improvement in CAPEX Rs. ~4-7 stations Debtor days Margins sustained Crs despite investment in Prudent Investments Financial Flexibility 11 stations for Profitability for Growth Strong Balance Sheet EBITDA Margins CAPEX 3

Introduction

MBL at a Glance Over 15 Years of Experience in the Radio Industry 11 Cities acquired in Phase III 1 st Private FM Radio Broadcaster in India ▪ ▪ Presence in 12 out of the top 15 cities of India by population 52.5 mn Listenership in 23 ▪ Presence in the Internet Radio Space with PlanetRadioCity.com – 42 web radio stations in 8 languages Cities ▪ Present in Android and iOS under an app called “Planet Radio City” Publisher: Radio City India 39 Radio Stations Ranked 1 st in the Media Industry and 2 nd in Best Place for Hiring and ▪ Welcoming categories by Great Place to Work in 2015 ▪ Ranked 1 in Mumbai, Bengaluru and Delhi under “Top of Mind” brand recall for 12 Of the Top 15 cities previous months covered Source: AZ Research Report, March 2017 (23 Markets), Census 2011, Great Place to Work (GPTW) 5 ^ Radio Mantra Stations has been transferred to MBL pursuant to the Scheme of Arrangement

Industry Potential

Radio Industry : Growth Ready Media Industry Radio Industry Highlights of Phase III Policy In Rs. bn In Rs. bn Government has Liberalized Regulations CAGR 14% 16% CAGR 2,419 48 Multiple frequencies: An operator under Phase III Policy regime may own up to 40% of channels in the same city subject to three different operators operating in the city, whereas under Phase II Policy permitted only one channel per operator per city 9% 15% 1,262 Permission to broadcast news and current affairs: The radio 23 channels can broadcast news bulletins of All India Radio as mutually agreed with Prasar-Bharati 728 12 Networking: An entity will be permitted to network its channels in its own network within the country, which results in saving of cost by sharing the infrastructure 2011 2016 2021 2011 2016 2021 License period: License period for the migrating stations has been extended to 15 years under Phase III Policy Growth in the Industry will be contributed by : Lock in: Lock-in period for the largest Indian shareholder has been Operationalization of new stations in both existing and new cities reduced to three years under the Phase III Policy Increasing usage of medium by new local and national advertisers FDI Limits: The present FDI limit 49% as against 20% under the Phase II Policy regime Radio transitioning into a ‘Reach Medium’ from the traditional coverage medium Source: Radio and online Services, RAM Report(4 Markets), KPMG-FICCI Report 2017 7

Mega Industry Trends Increase in number of frequencies ✓ Increased frequencies from 243 to 405 post Phase III, Batch 2 Increase in the wallet share ✓ Radio’s share in the overall advertising revenue ranges ~ 4 -5% which is lower than many developed countries where the share is ~ 7-10% Deepening Penetration ✓ FM reached 45% of India’s Population which is expected to go to 60 -65% ✓ Share of Listeners tuning into Radio from home is 78.1% in 2016 Government Initiative ✓ Increased the FDI limit in Private FM radio raised to 49% in 2015 ✓ Increased the license period to 15 years in Phase III Source: KPMG-FICCI Report 2017 8

Radio City Rag Rag mein LEADERSHIP 9

Rag Rag mein LEADERSHIP Industry Product Organizational Leadership Leadership Leadership Leadership Position in Large Markets Right Shows : Right Time Internal Operational Systems & HR 1. 1. 1. Received 28 awards in 2016 and 33 awards and counting in 2017 Leadership in Mumbai and Bengaluru Right Markets : Right Price 2. 2. 2. Great Place to Work - Ranked 1* in Media Industry Leadership Advertising Volume New Age Digital Media 3. 3. 3. * In 2014 & 2015 10

Industry Leadership

Leadership Position in Large Markets Listenership Across Listenership in Mumbai Listenership in Delhi Listenership in Bengaluru Markets In mn In mn In mn In mn 52.5 8.4 9.2 4.7 8.2 42.1 3.7 7.2 6.4 5.9 3.2 5.5 5.8 5.5 2.7 27.2 2.3 22.7 15.1 2.0 9.1 Radio City Radio Mirchi Big FM Red FM Fever Radio One Radio City Big FM Radio Mirchi Fever Radio One Radio City Radio Mirchi Red FM Big FM Fever Radio City Big FM Radio Mirchi Fever Radio One Radio City has been Ranked 1 in Mumbai, Bengaluru and Delhi in terms of number of listeners and have a total number of 52.5 million listeners across all 23 cities covered by AZ Research Source: AZ Research Report, March 2017 (23 Markets) 12

Leadership in Mumbai and Bengaluru Listenership Market Share Data Mumbai Bengaluru 20 30 25 16 20 12 % Share % Share 15 8 10 4 5 0 0 2013 2014 2015 2016 YTD 2017* 2013 2014 2015 2016 YTD 2017* Mirchi One City Big Mirchi One City Red Big Indigo Fever S FM Mirchi 95 Fever Oye Nasha Redtro Amongst the highest average listenership share percentage in Mumbai and Bengaluru Listenership market share represents the percentage of the total radio listeners that are tuned to a particular station in a given time period. It depends both on the number of individuals who are exposed to the station and the average amount of time spent listening to the station over a defined time period Source: RAM Data (4 Markets) 13 *Jan – Mar 2017

Leadership in Advertisement Volume Advertising Volume 12.1% Real Estate Government BFSI 6 Year CAGR (FY11-17) 9.7% 9.0% 9.1% 8.3% 4.0% 8% 10% 16% Radiocity Radio Big FM Red/S FM Others Industry Mirchi mn Seconds (FY17) Others Retail E-commerce 34.2 63.2 94.6 342.3 74.9 75.4 53% 7% 6% Radio City has seen a 6 year CAGR of ~12.1% compared to industry CAGR of 9.1% in Advertising Volume MBL has # 4,634 Advertisers in FY17 Source: AirCheck Data (14 Markets) 14

Product Leadership