km wedding events management inc. a comprehensive wedding...
TRANSCRIPT
KM Wedding Events Management Inc.A comprehensive wedding services company
Investor Presentation
LD MICRO – Los Angeles December 2014
OTC: KMWE
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OTC: KMWE
SAFE HARBOR
This presentation may contain “forward-looking statements” that are madepursuant to the “safe harbor” provisions as defined within the PrivateSecurities Litigation Reform Act of 1995. Forward-looking statements may beidentified by words including “anticipates,” “believes,” “intends,” “estimates,”and similar expressions. These statements are based upon management’scurrent expectations as of the date of this presentation. Such forward-lookingstatements may include statements regarding the Company’s future financialperformance or results of operations, including expected revenuegrowth, cash flow growth, future expenses and other future or expectedperformances. The Company cautions readers there may be events in thefuture that the Company is not able to accurately predict or control and theinformation contained in the forward-looking statements is inherentlyuncertain and subject to a number of risks that could cause actual results todiffer materially from those indicated in the forward-looking statements.Further information on these and other potential factors that could affect theCompany’s financial results is included in the Company’s filings with the SECunder the “Risk Factors” sections and elsewhere in those filings.
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OTC: KMWE
ABOUT KM WEDDING EVENTS MANAGEMENT
Leading one-stop solution provider of matrimonial and wedding
services for Indian & Indian-American markets
Strong brand and presence in the Indian market since 2004
High ROI customer acquisition through multiple channels, including physical
locations and media outlets (Internet, TV, print)
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Match Making
600,000+ matrimonial customer
profiles registered
250,000+ weddings enabled over a
decade and 30,000 in 2013
Wedding Event Management
Wedding halls; event planning; food &
beverage; bridal services; honeymoon
packages; concept, theme and
celebrity weddings
OTC: KMWE
INVESTMENT HIGHLIGHTS
Established track record and brand with projected rapid growth in both Indian and Indian-American markets
High ROI and scalable business model – turn-key solution for wedding events across India and the US
Leveraging established match-making client base of 600,000 registered clients to upsell higher revenue/margin wedding event management services
Ability to accelerate growth through cross-selling to wedding guests and providing full lifecycle services
Growing revenue, profitable, solid balance sheet, and clean capital structure
Proven management team with over 70 years of combined industry experience
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OTC: KMWE
INDIAN WEDDING MARKET OVERVIEW
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$32.29$40.36
$50.45
$63.06
$78.82
$98.53
0
20
40
60
80
100
120
2010 2011 2012 2013 2014(E)2015(E)
Market Size USD Billion
Market Size USD Bn CAGR
Matrimony:
South India delivers 44% of potential customers
Physical locations dominate market with 88% share
Online market share small but increasing consistently
Wedding Events:
Five major metro cities account for 50% share of the Indian market
Dominated by a large number of un-organized players
OTC: KMWE
INDIAN WEDDING INDUSTRY OUTLOOK
Current wedding industry of $60bn is set to grow by 25% per annum
The estimated cost of a wedding is from $10,000 to $1 million
A destination wedding in Goa or Jaipur can cost between $200,000 to $400,000
Wedding industry growth increases demand for events and structured planning services
Trends: theme weddings, destination weddings, wedding planning online software, online classified players diversifying into wedding planning
Facts and figures related to the industry:
No. of Indian marriages per year (approximately): 10 million
Venue decoration market: $5 billion
Venue rent and catering: $8 billion
Wedding invitation card market: $2 billion
Bridal Mehendi market in India: $1 billion
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MARKET NEED FOR COMPREHENSIVE TURN-KEY WEDDING SERVICES
OTC: KMWE
MATCH MAKING IS NOT GOING AWAY
Indian marriages are largely arranged by families
South India has 81% arranged marriages
Women with English fluency have 80% arranged marriages
Arranged marriage ratio is the highest among highly educated women
Only 6.25% women reported “love marriage”
Even if the rate of love marriages increases, arranged marriages willcontinue to dominate the market for the foreseeable future
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OTC: KMWE
MARKET DRIVERS FOR WEDDING EVENTS MANAGEMENT
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Lack of quality wedding halls to keep up with the demand
Limitation in hotel banquet halls to perform traditional religious weddings
Busy lifestyles demand trusted, turn-key wedding solutions
Industry largely unorganized and fragmented - lacking quality, scale, resources, technology and most importantly innovation
Lack of comprehensive service providers that offer one-stop-solutions
Demand Supply
OTC: KMWE
KMWE SERVICES
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Match making through: TV programs (700+ episodes)
Website
Print magazine
Relationship managers
19 centers in India & U.S.
Huge customer base 600,000 profiles
30,000 matches last year
Turn-key services for wedding events 100+ wedding events managed Array of over 30 different services
Catering to logistics Décor to photography Bridal dresses to honeymoon
packages
Outstanding customer reference and feedback
Focus Segments Indian and Indian-American Middle-to-high income
Match-Making Services: “Kalyanamalai”
Wedding Services: “Athithi”
Legacy Services Growth Strategies
OTC: KMWE
MATCH-MAKING SERVICES: “KALYANAMALAI”
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TV Show (#1 channel; 15 years running)
Viral marketing/referrals
Online & call centers
Branches & events
Magazine
Narrow target profiling
Achieving partner expectations
Sales closed by match-making executive
Acquisition Channels Acquisition Process
Key-Benefits:
Wide reach through multiple channels
Comprehensive match-making engine
Personalized service through Relationship Executive
Enhanced success rate
Increasing success rate:
First 9 years: 100,000
Following 4 years: 100,000
Last 6 months: 20,000
OTC: KMWE
WEDDING EVENT MANAGEMENT: “ATHITHI”
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Leveraging the existing match-making business platform by forward integrating into Wedding Event Management Services
Establishing a branded wedding hall chain network through long term lease arrangements = asset light strategy
Offering a comprehensive and growing suite of turn-key wedding services
Centralized planning, quality control, procurement, kitchen & supply chain for the halls (hub & spoke model)
OTC: KMWE
DIFFERENTIATED WEDDING EVENT STRATEGY
Low Quality High Quality
Low
High
Normal Hall +
Contractor
Market Demand (KMWE)
Wed
din
g Su
itab
ility
Wedding Infra & Service
Typical Wedding hall + Good Contractors
Typical Star Hotels Banquet Hall
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OTC: KMWE
SCALABLE WEDDING HALL MODEL / HIGH ROI
Plan to operate 10+ wedding halls over the next 2-3 years
Estimated near-term revenue of $20M+ with over 30% EBITDA due to scalability
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Sample Wedding Hall Model
Avg Rev./Wedding $25,000
No. Weddings/Yr. 60
Revenue/Yr. $1,500,000
Cost of Services $1,110,000
EBITDA / Yr. $390,000
EBITDA % 26%
Investment Per Hall $600,000
OTC: KMWE 15
Leveraging match-making business platform into wedding event management service
Expanding quality wedding infrastructure chain without major capex costs
Establishing a branded wedding hall chain network through long term lease arrangements
Offering a comprehensive suite of 30 services to encompass a wedding event under the chain
Centralizing planning, quality,
procurement, kitchen & supply chain for the halls
Keyfactor
for revenue growth
Scale throughhub & spoke model
GROWTH STRATEGY
OTC: KMWE
CONVERSION INTO GROWTH
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10%
$75M=
Conversion of 10% match-making customers into wedding services customers = $75,000,000 in new revenue at protected EBITDA Margin of 40%.
40%EBITDA Margin
CORE BANQUET HALL & WEDDING EVENT SERVICES
OTC: KMWE
PRODUCT/SERVICE UPSELL – FINANCIAL MODEL
Wedding shopping
Honeymoon packages
Household goods
Baby products
$112.5M
$15.0M
$75.1M $75.0M
$33.8M
$4.5M
$15.0M$22.5M
US$
Revenue Profit
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Future serves:
• Home buying assistance• Mortgage consulting• Financial loans• Etc.
• Assumes 10% conversion of match-making customers (60,000) into wedding customers (30,000 weddings);• Assumes upsale of just 25% of wedding services customers
OTC: KMWE
VIRAL GROWTH - MONETIZING WEDDING GUESTS
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On average, 500+ guests attend each wedding; assuming 30,000weddings (per year)
Conversion of 2% = 300,000 future customers
Conversion of 5% = 750,000 future customers
Plan to upsell wedding guests a variety of services, including butnot limited to:
Match making
Wedding services
Wedding shopping
Honeymoon packages
Household goods
Baby products
Etc.
OTC: KMWE
PROVEN MANAGEMENT TEAM
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Name/Title Experience Highlights
TV Mohan (aka Venkatesan)Founder & Chairman
Entrepreneur & celebrity30 years of match making and wedding event management experience
Meera NagarajanPresident, CEO and Board of Director
Responsible for overall business,20+ years experience in wedding servicesEditor for KM Kalyanamalai magazine, Masters Degree in Public Administration and Economics
Vijaya BhaskarCFO and Board of Director
Finance, responsible for technology and US operations15+ years of business experienceBachelors Degree in Computer Science
Sridhar KalyanasundaramDirector – Indian Operations
Head of Indian operations, marketing and wedding events24+ years of business experience Cost accountant, company secretary & financial planner
Suresh VenkatachariPresident – US Operations
US Operations25 years of Business experience Entrepreneur and Active member of several indian associations
OTC: KMWE
INCOME STATEMENT
FY 2014 FY 2013
Total Revenue $1,564,825 $1,436,632
Total costs & expenses $1,441,996 $1,668,749
Operating Income (Loss) $122,829 ($232,117)
Income / (loss) before income tax expense $92,411 ($269,295)
Net Income (loss) $82,539 ($278,938)
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FYE March 31
• In FY 2014, Revenue growth exceeded 20% in Indian Rupees• Indian Rupees depreciated by 11% against US$ between 2013 and 2014, so the net revenue
growth in US$ was approximately 9%• For Public listing and setting up of US business operations, the company spent approximately
$268,000 in FY 2013 and $150,000 in FY 2014,
OTC: KMWE
BALANCE SHEET
31-Mar-14 31-Mar-13
ASSETS:
Cash and cash equivalents $88,616 $374,598
Total current assets $875,303 $680,140
Total assets $1,915,920 $842,498
LIABILITIES & SHAREHOLDERS’ EQUITY
Total current liabilities $1,093,272 $1,022,707
Long-term debt $20,865 $54,616
Total stockholder equity $750,695 $(278,393)
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OTC: KMWE
INVESTMENT SUMMARY
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Established track record and brand with projected rapid growth in both Indian and Indian-American markets
High ROI and scalable business model – turn-key solution for wedding events across India and the US
Leveraging established match-making client base of 600,000 registered clients to upsell higher revenue/margin wedding event management services
Ability to accelerate growth through cross-selling to wedding guests and providing full lifecycle services
Growing revenue, profitable, solid balance sheet, and clean capital structure
Proven management team with over 70 years of combined industry experience
OTC: KMWE
KEY STATISTICS
Ticker: KMWE
Share price (as of 12/1/2014): $.32
Common shares outstanding: 41.6 M
Market Capitalization: $13.3 M
Fiscal 2014 Revenue (YE March 31, 2014): $1.6 M
Fiscal 2014 Net Income (YE March 31, 2014): $0.08 M
Total shareholder’s equity (Sept 30, 2014): $0.9 M
Fiscal year-end: March 31
Insider ownership: 55.1%
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OTC: KMWE
Thank you!
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Contact:David K Waldman or Michael LakshinCrescendo Communications, LLCTel: 212-671-1020 x [email protected]