#1CL educate 6899 Excellence In Education. Since 1995 Q2 FY20-21 Investor Presentation Presented by: CL EDUCATE LIMITED#2Core Values R O H Risk Taking OPENNESS OWNERSHIP HONESTY &COMMITMENT INNOVATION CL educate Presented by: CL EDUCATE LIMITED 2#3Safe Harbor This presentation has been prepared by CL Educate Limited (the "Company") solely for information purposes without any regard to any specific objectives, financial situations or information needs of any particular person. This presentation and its contents are confidential and should not be copied, distributed, disseminated, published or reproduced, in whole or part, or disclosed by recipients directly or indirectly to any other person. Data and comments contained in the presentation are basis what the Company believes are a reasonable representation of its businesses. Certain statements in this document may be forward-looking statements. Such forward-looking statements are subject to certain risks and uncertainties like regulatory changes, local political or economic developments, and many other factors that could cause our actual results to differ materially from those contemplated by the relevant forward-looking statements. CL Educate Ltd. will not be in any way responsible for any action taken based on such data or comments or statements and undertakes no obligation to publicly update these data or comments or forward-looking statements to reflect subsequent events or circumstances. FY 18-19 or FY 19 means the year ending March 31, 2019 FY 19-20 or FY 20 means the year ending March 31, 2020 H1/Q2 FY21 means period ending Sep 30, 2020; H1/Q2 FY20 means period ending Sep 30, 2019 CI. CL educate Presented by: CL EDUCATE LIMITED 3#4Contents COVID Impact & Business Updates Financial Updates The New Normal *CL educate 4 Presented by: CL EDUCATE LIMITED#5Changing face of Business CI. CL educate Digital Transformation • . Digital First Premium-on-Demand • Tumult will continue Next 2-4 quarters Costs (offline) Pruned, will be flat Growth through . Higher EBITDA model in Cash Cows Foothold in Jobs segment (UPSC, GATE, NRA/Bank) - focus on market share 5#6Business Focus in H1 Remains Digital Driven Career Launcher Test Prep Digital Sales & Marketing Product Innovation Digital Delivery (inc. BPs) [ ] i KESTONE Corporate Virtual Events Digital Marketing Mar Comm CI. CL educate 6#7Q-on-Q: Business Progression POST COVID Study-centers in India slowly reopening in Q3 FY21 • Digital Billing up 5.5x, Digital enrollments up 89% • Sign of slow recovery in MBA & Law . • MBA - Volumes up 15%; • Law - Excellent results in CLAT & AILET, strong start to the new season Enterprise Corporate Biz stabilizing in Q2 FY21 on the back of strong Digital biz Publishing business showing slow progress in Q2 compared to Q1 CI. CL educate 7#8Enterprise: A Brief Snapshot Corporate Virtual Events . 70 Events in 100 days $800,000 confirmed Digital Marketing & Marcomm growing FY21 VEP will be the main driver of Growth International Biz picking up but a long way to go. Institutional Academic & Admission season delayed by 90-120 days Cash Crunch at institutions, lowers marketing Budgets Delayed payment cycles Pivoted Biz Model to leads and outreach against outcomes and more advance payments CI. CL educate 8#9Contents COVID Impact & Business Updates Financial Updates The New Normal *CL educate 9 Presented by: CL EDUCATE LIMITED#10H1 FY 2021 - A Brief Snapshot Physical Digital: 90 - 10 to 10 - 90 trend has continued through Q2 Total Income EBITDA PBT PAT Rs. in Cr Sep 20 Sep 19 97.9 192.8 9.2 25.3 0.8 14.2 0.6 10.7 CI. CL educate 10 Presented by: CL EDUCATE LIMITED#11Test Prep Key Business KPIs 89% CL Digital Enrollments 55,482 - Sep 20 29,396 Sep 19 Daily Active Users ✓ 68,575 - Sep 20 48,086-Sep 19 CI. CL educate 43% 450% Digital Billing 62.5 Cr-Sep 20 11.4 Cr-Sep 19 $ Monthly Repeat Users 33% - Sep 20 ✓ 25%-Sep19 8% 11#12Test Prep KPIs - Lead & Lag Indicators Lead Indicators Sep 20 Sep 19 Lag Indicators CI. CL educate Digital Users 45 Mn 29 Mn 55% Monthly Active Users Digital Enrolments 55K 29K 89% 2 Mn 1 Mn 100% Monthly Repeat Users 33% 25% Billing 32% 625 Mn 114 Mn ↑ 450% Daily Active Users 69K 48K 43% Minutes Spent 27 Bn+ 17 Bn+ 59% 12#13The Improving Wedge Revenue (mn) 40000000 35000000 30000000 25000000 20000000 15000000 10000000 5000000 0 Jul'18 Aug'18 Sep'18 COVID Effect Oct '18 Nov'18 Dec'18 Jan'19 Feb'19 Mar'19 Apr'19 May'19 Jun'19 Jul'19 (mn) Total Revenue Aug'19 Sep'19 Oct'19 MCAC (mn) Nov'19 Dec'19 Jan 20 Feb'20 Mar'20 Apr'20 May'20 Jun'20 Jul'20 Aug'20 Sept'20 Oct'20 Aptitude Segment MBA, Law, IPM, International Education 'Revenue - MCAC' MCAC (mn) Seasonality 13#14Contents COVID Impact & Business Updates Financial Updates The New Normal *CL educate 14 Presented by: CL EDUCATE LIMITED#15Financial Snapshot Enrollments 16% 55,482 Sep 20 66,149 Sep 19 Billing 62.5 Cr-Sep 20 136.4 Cr-Sep 19 49% | Digital | 55,482-Sep 20 I I 29,396-Sep 19 | Consol Revenue 97.9 Cr-Sep 20 192.8 Cr-Sep 19 $ CL *CI. educate EBITDA Margin 9.4% - Sep 20 Sep 19 13.1% 370bp EBITDA 9.2 Cr-Sep 20 25.3 Cr-Sep 19 64% 15#16Cost Impact Fixed Variable Sustainable reduction of Fixed Costs by ~5.5cr per Qtr 75% Reduction in Avg Quarterly Rent in H1 (1.6cr) 29% Optimization of Manpower Expenses (3cr) 30% reduction in Administrative Costs (0.7cr) Average borrowing costs has come down by 100bp Increase in Other Expenses of ~5.7cr in Q2 Digital Business Support up 1.2cr Q-on-Q Digital Marketing up 0.5 cr Q-on-Q Kestone Business Servicing expenses increased by 2.9cr inline with growth in Q-on-Q revenue Increase in Bad Debt on account of COVID (1.9cr) CI. CL educate 16#17Consolidated: Cash Position MF Investments Fixed Deposits Cash & Cash Equivalents Gross Cash Sep 20 Jun 20 Mar 20 37.9 37.6 37.2 19.1 23.1 12.1 13.4 13.0 11.6 70.5 73.7 61.0 Borrowings (Current & Non-Current) (41.3) (41.5) (42.8) Net Cash Trade Payable 29.2 32.2 18.2 28.6 37.9 40.7 CL *CI. educate Rs. In Cr. 17#18Merger Update • Merger process stalled due to COVID ✓ NCLT Chandigarh moving to VC mode, but not hearing Merger matters yet Last 5 Hearings postponed ✓ Emergency petition request was entertained by the NCLT Bench in October ✓ Order reserved, expected to be released post Diwali • As things stand: ✓ Best Case Scenario: May '21 ✓ Could well push into next FY CL *CI. educate Presented by: CL EDUCATE LIMITED 18#19Thank You For Investor Relations Queries Contact Arjun Wadhwa Chief Financial Officer CL Educate Ltd. Call: +91-98116 17289 E-mail: [email protected] [email protected] WISDOM IR Amit Kanabar Investor Relations CL Educate Ltd. Call: +91-88009 76683 E-mail: [email protected] [email protected] Ajay Jindal: [email protected] Nirjhar Gupta: [email protected] CL educate#20Annexures CL educate 20#21Merger Scheme Pre-Merger Organization Structure CL Educate Limited 1A Wholly owned subsidiaries CLEIS CL Media Upward merger of all the subsidiaries with CL Educate Post-Merger Organization Structure GKP CL Educate CL educate Kestone AKMS Consumer Segment Enterprise Segment Composite Scheme: Merger of CLEIS, CL Media, GKP, AKMS and Kestone with CL Educate Presented by: CL EDUCATE LIMITED 21#22Indian Education Landscape Operating in sizable @ $100 bn+, fast-growing industry A $100 bn+ market growing @16% CAGR CL's focus areas Unregulated/ Education Industry Informal/ Entrepreneurial Test-prep/ Coaching 7.2% GDP Growth expected in the $2.2 trillion Indian economy in FY18 (IMF) Budget'19 allocation to education Is Rs 8,187 bn, Up 10% YOY Regulated/ Formal ~2/3rd of the Industry K-12 Education $52 bn growing @ 14% CAGR Higher Education $15 bn growing @ 20% CAGR Vocational Education 28-29 mn people to be trained by FY20 (21-22% CAGR) Source: Technopak, CAGR - 2016 to 2020 Source: CRISIL, Google & KPMG H1 FY20 Investor Presentation Figures in Rs Cr CL educate JEE 14,600 GATE 1,680 Medical MBA Law 6,400 390 83 CA 2,520 UPSC, SSC, Bank PO 11,500 | T | CL's market-leading offerings Rs 37,800 Cr in FY16 growing @ 14% CAGR** Publishing Integral part of Test- prep services>> Assessments Actual coaching/ mentoring Assessments - - Schools, College, Placements Digital Publishing Publishing $28 mn with a growth rate of 20% ~$5.4 bn academic book publishing by FY21 @ 12% CAGR I Research Services Sunrise segment - Boosted by recently introduced universities ranking (NIRF) by MHRD, increased corporate demand for innovation & research solutions I Skill Training Huge Employability Skills demand - ~1mn youth enter the job market every month, Government encouraging Public Private Partnerships for Skill Training EdTech India's digital learning market is ~$2bn in 2016, and is expected to reach $ 5.7bn by 2020,, online market to 8-fold by 2021 to reach $2bn#23CL's portfolio CL R Comprehensive product portfolio in Knowledge & Career Services educate CL Group Aptitude Products (AP) MBA I Law | Bank/SSC I International Test-prep Consumer Services Knowledge Products (KP) GATE I IIT I Medical | CA | Civils Publishing Corporates Integrated Marketing Services (Corporates) Enterprise Services Universities Integrated Marketing Services (Institutions) Integrated Marketing Services (Research) Govt. Vocational Now Discontinued CL Educate Ltd GK Publications Pvt. Ltd Kestone Integrated Marketing Services Pvt. Ltd CL Media Pvt. Ltd Accendere Knowledge Management Services Pvt. Ltd 23 H1 FY20 Investor Presentation#24Corporate Structure 100% 57.85% Kestone Integrated Business, 100% ICEGATE GK Publications GATE based Test Marketing & sales Prep company services for corporates 100% Kestone 100% Kestone CL US Singapore Ltd. Integrated Business, Marketing & sales services for corporates Integrated Business, Marketing & sales services for corporates H1 FY20 Investor Presentation CL Educate Parent Company 100% 100% CL Media Test preparation publisher with significant owned content base Content development, books for sale via GKP, Student Outreach support to Edu Institutes Accendere Knowledge Mgt. Services 100% CLEIS Research Incubation & Support Career Launcher Education Corporate Research Infrastructure & Services Ltd Incubator 100% CLIP Career Launcher Infrastructure 44.18% Eduvisors CL educate Specialist K-12 focused education services company owning Indus World Schools Portfolio 361 DM (Associate Company) Private Ltd 4.41% Research & Technology-led learning & education company I 24#25Consumer Vertical Leader in Test-Prep Segment Consumer Bouquet of Products (MBA, Law, Civils, GATE, Engg, etc.) 1 National Test-Prep leader Delivering Successful Outcomes 70 CL Students in top 100 in the CLAT (Law) exam in May 2018 Growing Brand Equity from Sustainable Strengths Most comprehensive product-reach portfolio: 12 product groups + Network of 212* centers pan India & ~25K online users in FY18 CL educate 2 Household Test-Prep Brand Market leader in Aptitude Products (AP) MBA & Law offerings - CAREER LAUNCHER Well known Publications for test-prep E 3 6 2,939 Students received calls from at out of Top 10 in CLAT 18 & AILET 18 least one IIM in CAT 2016 out of 19,020 calls Scalable & asset-light business - 212* test prep centres with 63* owned & 149 under partnership in FY18 Strong Content 4 5 - Comprehensive, fully owned content, complemented by experienced faculty & trainers. 2,665 active titles (FY18) in Publishing Technology driven Multiple modes to reach students via digital strategies. 28% digital enrolments in FY18 - New brand acquisitions Addition of Knowledge Products (KP) via ETEN CA & IAS business acquisition; planned majority in ICE GATE Academy 俗 ETEN I.C.E. Inspiring Creativity & Endeavour IES GATE PSU 233 CL Students cleared Civil services (Preliminary) Examination 2016 18 selected in final merit list of the Civil Services Examination 2016 from 125 CL students Shortlisted in SBI PO 6 Mains Exam in 2017 H1 FY20 Investor Presentation CL 25#26Enterprise Vertical Knowledge services for Corporates, Educational Institutions. Differentiated offerings + One of the best execution capabilities Enterprise Unique Learning cum productivity DNA in Corporate services Corporates 35% Share Universities 3% Share Pioneer & Leader in Research & Ranking improvement services Knowledge Services for Corporates Sales . 1 Kestone 2,500+ Creative, approachable, multidiscipline Kestonians . 100+ . Strong reach and infrastructure to Indian cities & 10+ global destinations . 2 CL Media Managed Manpower Services Training & Development Marketing Marketing Communication CL educate Customized Engagement Programs Digital Marketing Experiential Marketing Research Services & Innovation For Corporate & Universities -facilitates wrt reaching out to the right student set and improving their quality of intake. Provides marketing services to corporates For Universities 3 Accendere - facilitates universities wrt improving their rankings through research and start-up incubation H1 FY20 Investor Presentation 26#27Unique Synergies Cross-leveraging between consumer & enterprise platforms CL educate CONSUMER ENTERPRISE Brand recognition across learning life cycle Multi-monetising of same customer at various stages of life Using same infrastructure at different times of day and year for high ROI CL initial brand contact when she is in school.... G. K. PUBLICATIONS Publishing division Career Launcher Test Prep Platform Cross sell publications to captive test prep/tutoring base Indirect advertising for test-prep/tutoring in publications ...She then meets us in college for test prep or experiences our research services... ...And then again in the workplace... ACCENDERE Enlightenment Guaranteed - Institutional R&D platform for schools/colleges ☐ KESTONE Corporate Marketing and manpower services Use Accendere to form tie-ups with schools/colleges and cross sell tutoring/test prep services Gain student mindshare early through research projects at schools, can be later leveraged to cross sell test prep services Leverage corporate network of Kestone to arrange industry partners for research projects at schools undertaken through Accendere Corporate network to aid student placement services in B2B 27 H1 FY20 Investor Presentation I#28Strong ethos Strong team, complete focus on governance & processes Professionally qualified, experienced and active board • Satya Narayanan R., Chairman & Executive Director 19+ years of experience in • the education sector Bachelor's degree in Computer Sciences from St Stephen's Post Graduate Diploma from • IIM Bangalore . • Girish Shivani, Independent Director, Chairman Audit Committee 23+ Yrs of exp in IT, Telecom, Media, Finance, Corporate Strategy & Operations Co-Founder & Managing Partner Yournest Venture Gautam Puri, Vice Chairman & Managing Director 19+ years of experience in the education sector Bachelor's degree in Chemical Engineering from Punjab Engineering College Post Graduate diploma from IIM Bangalore Imran Jafar, Non-Executive & Non-Independent Director • Co-Founder & Managing Partner Gaja Capital. 18+ Yrs exp. In PE, Pharma & Technology MBA from IIM-B, & Masters degree in software engineering from BITS Pilani Nikhil Mahajan, Executive Director & CEO Enterprise business 18+ years of experience in finance and education Bachelor's degree in Electrical Engineering from Benaras Hindu University Post Graduate diploma from IIM Bangalore Viraj Tyagi, Independent Director • . Over 21 years of experience in the financial services sector Post Graduate diploma from IIM Bangalore CL educate High Corporate Governance ✓ Independent/ Directors are Board Nominee a majority on Internal Audit by a reputed external firm Audit Committee, Nomination & Remuneration Committees have only independent/ nominee directors Whistle-blower mechanism Statutory Auditors & Co LLP - Haribhakti Key Senior Management H1 FY20 Investor Presentation • Capital Madhumita Ganguli, independent Director Over 25 years of experience and heads a large part of HDFC Arjun Wadhwa, Chief Financial Officer (CFO) • • 10+ Yrs of Experience in education space Profitable entrepreneurship ventures - Thesportscampus.com & Goals for Souls. Post Graduate diploma from MDI, Gurgaon Sanjay Tapriya, Additional Independent Director, CEO Uniworld Sugar Pvt Ltd CA & CS R Shiva Kumar, Chief Academic Officer 18+ years of experience in the private education sector, Bachelor's degree in Technology from IIT Madras, • Post Graduate diploma from IIM Kolkata Sreenivasan .R, Chief Customer Officer Over 15 years of experience in the education sector, Sujit Bhattacharyya, Chief Digital Officer Over 15 years of experience in the education sector, Master's degree in Technology from • Jawahar Lal Nehru University; Bachelor of Technology degree in Electrical Engineering from IIT Kharagpur; • Master's degree in Business Administration from IIM Bangalore • Post Graduate diploma from IIM Bangalore 28#29Two Big Rocks - Corporate CL educate H1 FY20 Investor Presentation Consolidation Realignment 29