Transcript Slide 1

SHREE ASHTAVINAYAK
CINE VISION LTD.
An Integrated Script
Private and confidential
Shree Ashtavinayak Cine Vision Limited
Shree Ashtavinayak – a snapshot
Industry Overview
Revenue Streams
A Unique Business Model
A Dynamic Management Team
Key Differentiators
Aggressive Growth Plans
Shree Ashtavinayak – A Snapshot
•
Focus: High entertainment value and mainstream Hindi filmed entertainment industry.
•
Repertoire: - Family entertainers, thrillers, comedy and romantic films.
•
Integrated: Across the complete value chain in the commercial motion-pictures segment –
from production to distribution and exhibition
•
Leadership: A relatively young company that has grown aggressively to achieve a
leadership position in distribution in the Mumbai territory – the largest film distribution
territory in India
•
Understanding: A deep understanding of audience preferences stemming from experience
in distribution translates to a high success-ratio of the films produced
•
Aggressively growing: Expected to outperform industry average of 18 per cent.
•
Progressive management: Company steered by a team of seasoned professionals.
Shree Ashtavinayak – Financial Snapshot
4th Quarter Ended
March 31, 2008
Year Ended
March 31, 2008
Year Ended
March 31, 2007
Income
2284.70
9356.86
9,606.63
Total Expenditure
619.45
1438.14
1,701.26
Depreciation on intangible assets
799.41
5874.08
5820.92
Profit Before Tax
840.84
2102.17
2,149.20
Total Tax
314.16
734.14
733.49
Net Profit
526.68
1368.03
1,415.71
5.25
13.64
19.63
Particulars (Rs. in Lacs)
Basic EPS (Rs.)
Strategy for Successful Releases
•
Best directors, script writers and actors
•
Proper selection of idea, concept & script
•
Excellent chemistry between director and actors
•
•
Multiple artists in genre of comedy/Love Story.
Excellent promotion through well made trailors
and attracting the audience through the title
songs
•
Excellent production values & shooting locations.
•
•
One of the best promotional campaign i.e. strength
of the marketing department
Making the movie in proper time & budge by
completion in less than industry average time
of 12 – 18 months
•
Released in maximum number of screens all over
India.
•
Proper financial management
•
Proper weightage on promotion & marketing
i.e. spending more on marketing for better
better opening at the time of release after
having proper controlling & monitoring
practices
•
Hard core entertainer which has universal
appeal
•
Best music albums in that particular year
•
Recovery of the cost of production before the
release of the movie
•
De-risked model & pre-selling of right to over the
C.O.P.
JAB WE MET
SUPERSTAR
BHAGAMBHAG
GOLMAAL
The Indian entertainment industry
Poised for an exciting period of growth
•
Media and entertainment industry is valued at
USD 7.72 billion and growing at 19%.
•
By 2010, the entertainment industry is expected
to reach USD 18.32 billion. Films contribute
about 20% share of the entertainment industry.
2.50%
2%
0.30%
Television
Music
41.90%
30.90%
Films
Radio
Print Media
19.30%
Live Entertainment
0.80%
Outdoor Advertising
2%
Internet Advertising
The Indian film industry
•
Currently the industry is valued at an estimated INR 68 billion
which is expected to double by 2010
•
The country has about has 12000, single screen theaters.
Growth in Multiplexes is expected from 328 screens in 2005
to over 1000 screens by 2008
•
Industry revenues expected to grow at CAGR of 18%.
Projected growth of the Indian film industry
200,000
153,000
132,000
INR million
150,000
113,000
97,000
100,000
56,500
68,000
79,000
50,000
0
2004
70,000
2005E
2006F
2007F
Source: Industry Sources
2008F
2009F
2010F
Indian films – paradigm changes
•
The Government granted “Industry” status to the
business in 2001 – making it easier for it to access
funds from the banking system
•
Reduced dependence on unorganised sector for
financing and underwriting/insurance has given it a
fillip resulting in greater professionalism and
accountability”
•
Huge growth in overseas market for Indian films
–
•
Craze for Indian films among the NRIs and the
neighboring countries
Easier availability of Institutional finance – Eg. IDBI,
Exim Bank
Widespread recognition of the industry changes
Film Finance :
Insurance companies bring best practices to
Bollywood.
•
Finance for Production of Films from Banks like
IDBI & Exim Bank.
•
•
IDBI ventures into film distribution after film
financing
Total premium from the film industry has already
crossed Rs 50 crores.
•
•
Total amount funded – Rs 460 crore
United Insurance, General Insurance Corporation,
Bajaj Allianz General Insurance have already
entered the arena
•
“ We have not been able to capture the upside in
case of successful films being financed by us.
We are looking at distribution to get a share of
profit made by our films” – says Mr. Jitender
Balakrishnan, Deputy MD, IDBI
•
Punctual movie stars, film production being
undertaken with a completed script and concluded
on time without cost overruns – That’s what
insurance companies have brought to Indian film
industry
•
“We have insured the largest number of films and
film insurance has been a profitable one for the
company” says M K Garg, Chairman United India
Insurance
Source: ET
Source: ET, September 14 2006
Revenue Streams
Theatrical Exhibition Rights
Overseas Rights
Satellite Telecast Right
Music Rights
In film endorsement & corporate sponsorships
Ring Tone Rights, Downloading Rights
In Cinema Advertising
Video CD & DVD rental rights
Internet Rights & Merchandising
Average revenue break-up
2.5%
18.0%
50.0%
8.0%
Domestic Theatrical
Sales
Overseas Sales
Music Rights
6.5%
15.0%
Source: Industry Sources
DVD/ VCD/ Video
rights
Satellite TV / Cable
Incinema ads / Corp
Ads
Territorial Break up of Domestic
Theatrical Sales
10%
Mumbai
Territory
8%
36%
13%
North Circuit
Central
Circuit
Eastern
Circuit
Southern
Circuit
Source: Industry Sources
33%
Territorial Break up – Mumbai Territory
7%
10%
3%
30%
Mumbai City
Gujarat
Maharastra/Goa
Thane
Saurashtra
Karnataka
25%
25%
Film Production – Cost Structure
6%
1%
10%
40%
8%
Artists, Film
and Music
Directors
Shooting &
Production
expenses
Post
production
Publicty
Contingency
Interest/Insur
ance
35%
Source: Industry Sources
Business Model
Production
Distribution
Exhibition
Business Model
Focus: High entertainment value
and mainstream Hindi films
Target audience:- All segments
Repertoire: - Family entertainers,
thrillers, comedy and romantic films
Movies With Mass Appeal
De-risked model
5 Parameter Test
Production
Distribution
Movies With Mass Appeal
Production
Distribution
Active Risk
Diversification
Production
Distribution
9
De-Risked Model
De-Risked Model
5 Parameter Test
Production
Distribution
Movies With Mass Appeal
Production
Distribution
Active Risk Diversification
Production
Distribution
 Star cast:- Bankability and market value of the star
 Banner/Producer:- Adequate financial resources to complete the movie on time
 Script/Director:- Strength of the script and track record of the director
 Music director: - Track record of the music director
 Marketing capability of the producer
10
De-Risked Model
De-Risked Model
5 Parameter Test
Production
Distribution
Movies With Mass Appeal
Production
Distribution
Active Risk Diversification
Production
Distribution
The recipe of entertainment:
 Script
 Screenplay
 Stars
 Salability
11
De-Risked Model
De-Risked Model
5 Parameter Test
Movies With Mass Appeal
Active Risk Diversification
Production
Multiple stream
of revenues
+
Focus
on cost
+
Bankable
stars/directors
+
Distribution
Cluster
bombing
12
De-Risked Model
De-Risked Model
5 Parameter Test
Movies With Mass Appeal
Active Risk Diversification
Revenue Pie (Production segment)*
Cost of Production
Recovered through pre-sale
Production
Mumbai
Territory
Box Office
25-35%
Box Office
from other
territories
25-35%
Profits
Distribution
 Pre-sells all the territories (except
Mumbai) and other rights of the
movie before the release
 Recovers all costs related to movie
 Revenues generated from Mumbai
territory go directly to the bottom-line
In-Cinema
Ads 2.5%
Video
Rights 8%
Music
Rights 7%
*Source: Company business model
Overseas
Theatrical
Rights 5%
Satellite/
Cable Rights
18%
 Company recovers all the money
invested in the project even before
the movie is released
13
De-Risked Model
De-risked model
5 Parameter Test
Movies With Mass Appeal
Active Risk Diversification
Production
 Reverse calculation of revenues
No of screens that movie can be screened on X
Percentage occupancy X
Per ticket cost X
First 3 days revenues = Total revenues
 Total revenues /1.2 = price of movie rights
Focus
on cost
+
Distribution
cluster
bombing
 Discounted higher if bought at an earlier stage
 The exposure of movie would be maximum in the
first week for revenue maximization
14
Business Model
Film Production:
• Began with producing films such as “Fun2ssh – Dudes in the
10th Century” and “Agnipankh”
• Recently released “Superstar” has received 3 star ratings by
Critics and running all over India successfully.
• A blockbuster hit film “Jab We Met” released on 26th October
2007 was highly acclaimed by Critics and the Audience.
• Largest and the most successful production ventures were
“Golmaal-Fun Unlimited” and “Maine Pyaar Kyun Kiya”
• “Bhagambhag” and “Golmaal-Fun Unlimited” were runaway
hits
• Excellent relationships with acclaimed directors, bankable stars
and technicians helps to ensure in high quality resources
available on time
• Corporate structure to help procure institutional funding and
insurance.
• Accelerated turnaround time -- films expected to be completed
in 10-13 months ensures cost effective production.
Latest Home Production Release
•
Directed by Rohit Jugraj
•
Starring Kunal Khemmu, Tulip Joshi, Aushima Sahney, Reema Lagoo etc.
•
Music Composed by Samir Tandon
A blockbuster n highly acclaimed Film
•Awarded by Film fare,Stardust and Star
screen in the categories of
• the best film,
• best Actor (Shahid Kapur) and
• bestActress (Kareena Kapoor)
•Best Dialogue writer (Imtiaz Ali)
Motion pictures produced and released
Films on the floor
•
Untitled by Abbas-Mustan
•
Untitled by Shivam Nair
•
Untitled Neeraj Vora
•
Untitled by Sanjay Gadhvi
•
Untitled by Rohit Shetty
•
CHAKKARA VIYUGAM - Tamil film
•
Untitled by Anthony D’souza
•
Untitled by Roomy Jafri
•
Untitled by Priyadarshan
Business portfolio
Film distribution:
• A leading distributor in the Mumbai Territory
• High success rate in distribution is ensured by grassroot
model to understand and estimate the market
• Successfully distributed blockbusters such as Main Hoon
Na, Dus, Mujhse Shaadi Karogi, Aitraaz, Phir Hera Pheri,
Partner, Heyy Babyy, Om Shanti Om, Welcome etc
• Acquired the worldwide distribution rights for the film Tom
Dick & Harry
• Geographical Expansion by distributing films in Delhi/UP,
Punjab, Rajasthan, Nizam and Overseas.
• Management insight into selection of films and its pricing
based on attributes like genre of the film, production house,
star cast, directors, the music and technology are
responsible for success.
A portfolio of our distribution successes
A portfolio of our distribution successes
A portfolio of our distribution successes
Directed By Farah Khan
Starring Shahrukh Khan,
Shreyas Talpade and
Deepika Padukone.
Directed by Anees Bazmee
Starring Akshay Kumar,
Paresh Rawal, Anil Kapoor,
Nana Patekar,
Katrina Kaif etc.
Business portfolio
Film exhibition:
• Strategy of acquiring running time/programming time of
single screen theatres in Mumbai Territory
• Allows the company to integrate with the retail end of the
cinema value chain
• Offers better understanding of audience preferences which
helps cherry picking films to be produced and distributed.
Attractively positioned:
Shree Ashtavinayak:
An Attractive
Proposition
•
One of the pioneers to put in place an integrated set up
covering production, distribution and exhibition.
•
A corporatized, professionally managed company
implies:
–
Smoother functioning, better coordination, rapid
turnarounds, superior budgeting and stricter
internal controls and lower cost over runs
–
Ability to garner the best talent from across the
industry
–
Organization wide discipline and well defined key
result areas for employees ensures better
performance and cost effectiveness
Shree Ashtavinayak:
Competitive edge
Competitive edge:
•
A de-risk approach to business by having presence in
the entire value chain
•
Experience in film distribution has ensured in-depth
interaction with leading entities in the industry
•
Established processes ensure clinical execution of the
projects and maximize utilization of resources
•
Ability to handle multiple projects simultaneously within
tight timeframes and budgets avoiding any time and cost
overruns.
•
Executing multiple projects results in economies of scale
across all production costs including fees to actors,
directors and technicians
Strong presence in the entire value chain
Production
• With an average margin of
25% this segment is the key
revenue driver for the
company
• Strength in distribution
contributes to greater insight
into audience preferencesminimizing risk & maximizing
returns.
• Corporate structure to help
procure institutional funding
and insurance facility.
Distribution
• Good relation with production
houses ensures continuous
availability of quality films
• It also provides an insight as
to how other production
houses function
• Greater control over home
productions.
• Distributing films from other
banners, provides critical
market knowledge besides
revenues
Exhibition
• Recent foray into exhibition to
gain control of the retail end.
• Gives assured audiences for
in-house productions.
• Provides deeper
understanding of the audience
preferences, aiding future
productions.
• Helps diversify revenue
streams
Segmental Break up of revenues and
PBIT March,07
Segmental Revenues
S ales
Segmental Profits
march,07
(in per c ent)
1
31
P roduc tion
D is tribution
68
E xhibition
Outside
Film
Distribution
20%
Film
Exhibition
1%
Inhouse
Film
Production
and
Distribution
78.53%
Management Team
Management Team
Mr. Dhilin Mehta
Chairman and Managing Director
Mr. Rupen Amlani
Director – Distribution and
Marketing
An M.B.A with a finance specialization, he is the promoter of Shree Ashtavinayak Cine
Vision Ltd. He oversees operations of the company. Dhilin began his career with small
budget films like Fun2ssh and Agnipankh and then led the company in its bigger ventures
in production and distribution. Presently he is concentrating on working with renowned
actors and technicians on the forthcoming ventures of the Company.
A Management Graduate specialized in Marketing. He is responsible for the Distribution
and Marketing Divisions of the Company. He is involved in the acquisition of distribution
rights for films produced by other production houses. After concluding the acquisition
deals, Rupen decides the media strategy using the various channels for publicity like
television, print and hoardings for successful commercial exploitation of the movies. His
experience of working with some of the large corporates such as Coca Cola and HSBC
and the understanding of how big organizations operate and sustain their businesses has
been of immense help.
Management
Team
`
Management Team
Mr. Dhaval Jatania
Director – Business Development
Mr. Hiren Gandhi
Director – Production
A Management Graduate (MBA), specialized in Marketing. He looks after Business
Development and is also involved with both Production and Distribution Divisions of the
Company. He is responsible for drawing up the strategic roadmap of the production
department, being the interface between the company and the directors, actors, scriptwriters and others. He guides a venture from concept to creation. His insight in the field of
distribution is of assistance while selling the different rights such as distribution rights,
overseas rights, music rights, satellite rights among others to extract the maximum
revenues.
A Computer Engineer, specialized in Networking. Hiren looks after the Production Division
and particularly focuses on the budgeting aspect. Each project receives his attention and is
responsible for the finalization of the scripts, directors, cast and locations. His experience
and relations built over the years with one and all aid smooth coordination between the
various facets of filmmaking. Hiren has been involved in all the three in-house
productions of Shree Ashtavinayak Cine Vision.
Key Differentiators
•
Creative and Dynamic management team not dependent on the skills and decisions of an individual.
•
Corporatised approach characterized by
–
Collective decision making
–
Young and professionally qualified management team
–
Delegated responsibility
–
Well established processes
–
Sound knowledge of art & culture
•
Long term commitment from bankable stars, renowned directors and technicians
•
Well defined projects in the pipeline for next 3 years
•
Cordial relation with the key stakeholders of the industry reduces competitive pressure
•
Vertically integrated in the entire value chain
•
Strong marketing strategy
Aggressive growth plans
Production
• Targeting at least 4 to 5 films in a year
• Signed up reputed directors and actors to ensure the success of our projects
• Make multiple projects in Hindi as well as targeting regional films
Distribution
• Targeting the distribution of about 6 films having potential to be big grossers
• Plans to improve margins through digitalization
• Geographic expansion into other territories and overseas markets
Exhibition
• Arrangements with various theatres for exhibition of films
• Plans to tie up with more single screen theatres and multiplexes
Disclaimer
In this communication we have disclosed forward-looking information to enable investors to comprehend our prospects and
take informed investment decisions. This report and other statements – written and oral - that we periodically make contain
forward-looking statements that set out anticipated results based on the management’s plans and assumptions. We have tried
wherever possible to identify such statements by using words such as ‘anticipate’, ‘estimate’, ‘expects’, ‘projects’, ‘intends’,
‘plans’, ‘believes’, and words of similar substance in connection with any discussion of future performance.
We cannot guarantee that these forward-looking statements will be realised, although we believe we have been prudent in
assumptions. The achievement of results is subject to risks, uncertainties and even inaccurate assumptions. Should known or
unknown risks or uncertainties materialise, or should underlying assumptions prove inaccurate, actual results could vary
materially from those anticipated, estimated or projected. Readers should bear this in mind.
We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future
events or otherwise.
The information contained herein has been prepared solely for information purposes and is not an offer or solicitation of an offer
to buy/sell the securities/instruments mentioned or to participate in any trading strategy or an official confirmation.
This is not a research and but it may refer to a research analyst/research report. The Company does not represent that the
information contained herein is accurate or complete. Information is subject to change without notice and we may not update
this. Past performance is not indicative of future returns. This price information (if any) is provided solely for informational
purposes and may differ substantially from price information available from other sources or an actionable price.
Thank You
A - 204/205, VIP Plaza, 2nd Floor,
B/7 Veera Industrial Estate,
Off Andheri Malad Link Road, Andheri (W)
Mumbai - 400 053
Tel: +91-22-6702 9630/1/2/3
Fax: +91-22-6702 9634
www.ashtavinayakindia.com
e mail: [email protected]