lnvestor Presentation FY - 2015 -16 [Company Update]

eCommerce Simplified


This presentation and the accompanying slides (the “Presentation”), which has been prepared by iStreet NetworkLimited (the “Company”), solely for information purposes and do not constitute any offer, recommendation orinvitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection withany contract or binding commitment whatsoever. No offering of securities of the Company will be made except bymeans of a statutory offering document containing detailed information about the Company.

Our actual results may differ materially from those included in this presentation for a variety of reasons, including,but not limited to - changes in political, business, and economic conditions; foreign exchange rate fluctuations; theimpact and integration of recent and future acquisitions; our need to successfully react to the increasingimportance of mobile payments and mobile commerce and the social aspect of commerce; an increasinglycompetitive environment for our businesses; the complexity of managing an increasingly large and growingenterprise, with a broad range of businesses; our need to manage regulatory, tax and litigation risks (includingrisks); and our need to timely upgrade and develop our systems, infrastructure, and customer service capabilities atreasonable cost while maintaining site stability and performance and adding new products and features.

This presentation also contains product demonstrations (or reference to such new products), some of which areconceptual and may not be developed or launched in the same form, with all of the same features or at all.

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 notadopted by the Company and the Company is not responsible for such third party statements and projections..

Safe Harbor


Our 1st Step


Business gaining Momentum

The unique, out of the box concept of iStreet Bazaar is generating tremendous interest and curiosity amongst customers thereby enticing small entrepreneurs to latch on to the model of iStreet Bazaar leading to growth in Volumes

18,938

5,023

226

14,149

Q4FY15Q3FY15Q2FY15Q1FY15

778

535

63130


43

16

8

4


No. of Transactions Sale value (Rs. In Lac)

Network Partners


13 Stores1st Store

Launched

Jan’14 Feb’14

130 Stores

Jun’14

184 Stores

Sep’14 Oct’ 14

No. of Transactions - 226GMV – Rs. 3.83 lacs

Aug’ 14

*All performance numbers are cumulative in natureGMV stands for Gross Merchandise Value

iStreet Bazaar – Performance*

227 Stores 1,506 Stores

Dec’ 14 Mar’ 15

193 Stores 727 Stores

Store Target - 3,500 to 4,000 Stores by March’16

No. of Transactions– 5,249GMV – Rs. 11.81 lacs




Our Journey


Group Evolution

YEAR 1986-88Incorporated in 1986 and started trading in API & intermediates in 1988

YEAR 1992-94Converted into Public Ltd

company in 1992 and raised funds through IPO in 1994

YEAR 1995Sets up GMP standard API & Intermediate manufacturing

plant in Gujarat

YEAR 1999Promoted India’s 1st Online

Chemical Trading PortalPwC – as a strategic partner

YEAR 2001-08

API & Intermediate business runs into rough weather and company

turns sick; Continues with Job Work

YEAR 2008-09Clears all debts & outstanding

and the company becomes debt-free

YEAR 2012

Comes Out of Financial Sickness & sets up Digital & eCommerce

division; Fully exited API & Intermediate Business


Digital & eCommerce

YEAR 2014

Selected to present at the Web Summit in

Dublin, Ireland

Launched iStreet BazaarIndia’s 1st internet Retail Store

Set up stores through network partners in Gujarat, Maharashtra & Rajasthan.No of stores - 1,001 as on Jan 31, 2015

Selected as the"Startup of the Year

2014" by Silicon IndiaYEAR 2007

Set up online auctionstores under the "cashin your attic" program

YEAR 2008Evolved the eBay "Trading Assistant" model. Delivered eCommerce to 100s of brands under this model till date

YEAR 2011Pioneered flash sales to ship 4,000-6,000 items a day on eBay

Managed India’s largest online auction for IPL 2011 involving BCCI & Volkswagen

YEAR 2012Created online jewelry configurator and sold loose diamonds online with IDEX India and eBay India

Set up "India Street" - Grocery products shipped from India to across the world

YEAR

2013Company Name changed to “iStreet Network Limited”


Retail Landscape


Retail

Modern Retail

Digital Retail

Evolution of Retail

Developed Countries


Indian Retail

One of the major pillars

13~15% of GDP

Retail in India


Indian Retail

~US$500bn(Rs. 30 lacs crores)

Retail in India


Mom & Pops91.6%

Modern Retail8%

eTailing0.4%

Retail in India


950

520

+82.7%

2018E2013

Re

tail

Mar

ket

Size

(U

SD B

n)

Source – Industry reports

India Retail – an overview

Org

aniz

ed

Re

tail

Pe

ne

trat

ion

20.0%

ChinaIndia

8.0%

Thailand

85.0%

40.0%30.0%

USAIndonesia

6.0%

11.0%3.0%

4.0%

5.0%3.0%

8.0%

60.0%

Re

ven

ue

Sh

are

in R

eta

ilC

ate

gory

Organized Retail

8.0%

Unorganized Retail

92.0%

Food & Grocery - 60%Apparel – 8%, Mobile & Technology 6%Food Service – 5%Con. Electronics – 4%Pharmacy – 3%Jewelery – 3%Others – 11%


Evolution of Retail - India

India

• Indian Retail Segment - Mom & Pops Stores, which are traditional family owned store, 96% of which is less than 500 sq. Feet

• Modern Retail though expected to be replace mom & pop stores, struggles to expand its share

• eTailing started growing since 2010, currently contributing negligible, though growing at a very fast pace


Moms and Pop Stores -the King without Crown

Low operational cost

Driven by trust & Quick

response

14 million

stores

Convenient Neighbourhood

Store

14 million Mom and Pop Stores in India are consumers’ most trusted point of buying But ... have limited product offering


Common Man popular image created by Late Shri R.K. Laxman. The same is used here just as a symbol and is not our property.

Common Man buys from

‘Mom & Pop’ store

Common Man of India



Common Man may be any person living in Urban, Tier 2,Tier 3 cities including Villages & towns

Common Man has aspirations and hopes

Common Man is a follower rather than creator or believer

Is 95% of Population of India who have yet not beentouched by eCommerce in its present & available avatar

Is largely dependent on Mom & Pop stores for its needs

Who is the Common Man of India



Common Man far away from

• Modern Retail• Digital Retail

Adoption of new formats of Retail


Confluence of Digital Retail & Indian psyche is a mismatch; it needs an innovative and differentiated platform

Does not have internet connectivity

Has Limited access to plastic monies

Prefers human interaction while transacting

Looks for trust factor while transacting on Internet 95

% o

f P

op

ula

tio

n i

n I

nd

ia

i.e.

Co

mm

on

Ma

n

Mom & Pop Consumer

Very low per capita Modern Retail space

Why he has not moved beyond

Mom & Pop

Is E-illiterate

LFR – Perceived as Stores for select FEWs


A Revolutionary concept


iStreet Bazaar is an Internet Retail Store

in a neighborhood where a common man can

buy products, ONLINE

(with assistance)


Modern Retail – large

offering / choice

Mom & Pop –convenient

Stores

Digital Retail –driven by Technology

Changing the Retail landscape of India with a unique India centric approach


iStreet Bazaar – a Physical Digital

Amalgamation


Get Quote

Yo ur T ext Go es her e.Down load th is aw esome

d ia g ra m. B r in g y o u rp r e se nta t io n t o l i f e.

Single stop for multiple type

of products

Access to Global and Local Brands

Facilitating Enhanced Shopping

Experience

Competitive Pricing

Safe, Secure & Authentic

Trust with the seller

Hassle free & highly

convenient

Neighborhood Store

Assisted eCommerce

Harmonious convergence of Physical & Digital shopping

iStreet Bazaar - Unique proposition


The model of iStreet Bazaar is a win-win proposition for all stakeholders

• Low Investment in setting up store

• Branding & Advertising to be undertaken by iStreet Bazaar

• No Inventory Management & Supply Chain Management

• Low Risk & Quick to start

Network Partners

BrandsCustomers

Opportunity to cater to 95% of the untapped population of India

Business with high return on InvestmentAccess to Global & Local Brands

at attractive prices

• Creation of Brand equity via deeper Penetration in Indian market

• Development of Loyal Customer Base

• Quality Products at competitive Pricing

• Wide variety and Choice

• High level of trust and familiarity in transactions

Win-Win for all stakeholders


Physical-Digital Convergence

Few Examples ..


IRCTC – Assisted eCommerce

www.irctc.co.in is a Government website usedfor booking tickets for Indian Railways

Portal charges a fee on every ticket bookedthrough the portal

Portal has tied up with various agencies such asYatra and Make my Trip

Recently portal added flight tickets, hotelbookings, car rentals and tourist packagesthrough its site

In FY14 IRCTC sold tickets amounting to grossvalue of Rs. 15,400 cr

www.irctc.co.in is a classic case of assisted eCommerce being used to increasingly penetrate deep in the Indian market thereby increasing ticketing revenue and achieve

faster growth for the gigantic Indian Railways

~24% of overall gross value of tickets purchased isvia agents, assisted eCommerce

Provided immense time saving for passengers due toavoidance of long ticketing queues

Agency model – it got 140,000 outlets and agentsthus creating deeper inroads in to the Indian market

IRCTC outlet in both Rural and Urban India brings~40% volumes with more than 3.0mn transactionsper month

Agency model created to combat internet illiteracyin far flung areas as well as trust issues with users

India examples

http://www.irctc.co.in/









Commonwealth Bank of Australia CBA)

Launched a program to revamp branch network to improve convenience and service levels Project produced an impressive succession of DIGICAL (Digital + Physical) innovations Project Finest Online modernized CBA’s Internet Banking Service and combined it with in person channels

to eliminate all-too-frequent problems such as inability to link personal accounts to commercial accounts Fusion based strategy propelled CBA to the highest customer-satisfaction ranking for retail banks in 2013 CBA’s share price rose 80% from 2006-2014 compared to 9% for S&P/ASX 200 index Competitors taking far longer to emulate the success story of Digical adopted by CBA

Menswear Digital retailer Bonobos Counts it offline offline “experiment” a success. Co-founder and ChiefExecutive Andy Dunn told the New York Times, “We said we would never be offline, and then, wait asecond … we hit a big turning point. We realized offline really works.”

Warby Parker stormed onto the scene in 2010 by selling affordable eyewear exclusively online. Afterbuilding a flourishing e-commerce business, co-founders David Gilboa and Neil Blumenthal decided tobreak into bricks-and-mortar in 2013. With eight storefronts across the country, customer service,interaction and community have helped the brand thrive. As of November 2014, Warby Parker’s bricks-and-mortar stores are now collectively turning a profit, selling an average of $3,000 a square foot annually.

Global examples

Source –Harvard Business Review and Magazine Articles


Project so far …


Rathodi Village, Malad (W), Mumbai

Conducted a pilot program in Rathodi Village, Malad (W) inJune, 2012

Rathodi Village in Malad (W) is about 40kms from MumbaiMain and 2kms away from Malad which is a hub for BPO, KPOand large IT companies.

Target – to test the market and gauge common man feedbackon this project

Put up banners of the offer to create a buzz about the wristwatches on sale – sale online

On the day, sold 40 wrist watches online in 5 hours throughlocal neighborhood store to the people of Rathodi. All soldonline. All monies collected in advance and watches deliveredafter 3 days

eCommerce was simplified for Rathodi villagers who were very near to eCommerce & Tech hub in

Malad, yet so far from it.

Common Man of India


1,506 (as of 31st March, 2015) iStreet Bazaar Stores currently available to ~150mn population

Network Coverage

Maharashtra (Western) 383 Stores

Rajasthan 474 Stores

Gujarat 555 Stores

Chattisgarh & MP 94 Stores


Existing Category

Pipeline

Mobiles

Computers

Accessories

Home Appliances

Apparels Focus on Men's &

Women wear categories

Fashion & Lifestyle

Include products such as Wallets, Bags, Sunglasses, Wrist Watches

Thousands of products under 11 categories & 55 sub categories & expanding

iStreet Bazaar – Product Portfolio


International Recognition in Dublin,

Ireland

Received overwhelming response at the Web Summit 2014 held in Dublin, Ireland


Team


Pradeep Malu : Founder and Managing Director

• Chartered Accountant by qualification

• An eCommerce professional since late 90’s and has set new rules forbusiness growth using eCommerce

• Conceptualized and executed large number of eCommerce projects inB2C, B2B and C2C space

Lakshya Malu : Co-Founder

• Mechanical Engineer from Boston University, USA

• Worked with Memorial Sloan-Kettering Cancer Research (NYC) andCyber Materials LLC.

• Handled eCommerce projects of TML, ITC, Videocon, SOTC and others

• Conceptualized iStreet Bazaar and did pilots / proof of concept to seehow eCommerce can be simplified for common man of India

Promoter Group


Bhanwar Singh

Sales & Operations

Navin Rane

Human Resources

Nagalaxmi Charipalli

Branding

Has over 9 years of work experience in Retail & eCommerce industry Responsible for expanding Network, Business Development, Sales & Operations

Has over a decade of expertise managing core HR functions Responsible for building and developing a pool of talented Human Resources

Holds a Masters of Science & Masters of Marketing Management from JBIMS, Mumbai Responsible for marketing & branding activities

Ruchi Seksaria

Company Secretary

Has over 8 years of experience in areas as Corporate affairs, Legal and Governance Responsible for adopting good governance practices at iStreet

Management Team

Rocky Braganza

AVP - Business

Over 19 years of work experience in Electronic Category across Online & Organized Retail MBA in e-Management Marketing he has worked with all stakeholders in Retail segments


Ratan Jain

Internal Audit

Professional

Qualified Chartered Accountant with over 12 years of experience Oversees and builds System Audits, Internal Audits, Management Audit besides setting up

processes and documents for Finance Department

Shriram Shrikrishna

Manager Category

Development

Over 12 years of experience in Retail & Marketing experience with leading retailers Responsible for sourcing New Vendors, Vendor Development & Product Portfolio

Management Team

Kapil Dubey

Manager Category

Development

Over 8 years of experience in Retail Management, SCM & Business Development Responsible for Category Development from conception to maturity stage


Financials


Pharmaceutical & Int. business thru Job Work

Sale of underperforming assets of Pharmaceutical & Intermediate business in FY15

Particulars (Rs. Lacs) Mar-15 Mar-14 Mar-13 Mar-12

Total Revenue 94.9 74.1 51.7 19.7

Pharmaceuticals --- 13.9 20.6 19.7

Digital & eCommerce 94.9 60.2 31.1 ----

Total Expenses 398.5 55.7 24.0 11.6

Raw Material Expenses 67.7 37.9 10.7 -

Employee Benefit Expenses 72.9 7.1 6.8 1.5

Other Expenses 257.9 10.7 6.5 10.1

EBITDA -303.6 18.4 27.7 8.2

Depreciation 14.3 8.4 11.2 10.2

Exceptional Items 260.1 16.5 1.8 4.8

Profit before Tax -57.3 -6.4 14.8 -6.9

Tax - - - -

Profit after Tax -57.3 -6.4 14.8 -6.9

Profit & Loss

Digital & eCommerce business Revenue • Up to FY14 - 3rd party Platform sales ; • FY 15 – iStreet Bazaar Project Revenue started building


Particulars (Rs. Lacs) Mar-15 Mar-14 Mar-13 Mar-12Shareholders Funds 491.8 466.4 472.8 98.0

Share Capital 801.0 795.0 795.0 435.0

Reserve & Surplus -363.1 -328.6 -322.2 -337.0

Money Received against warrants 53.9 - - -

Current Liabilities 90.0 49.8 30.4 35.0

Trade Payables 14.4 1.4 0.2 0.0

Other Current Liabilities 75.6 48.4 30.2 35.0

Total 581.8 516.2 503.2 133.0

Non Current Assets 83.0 122.7 93.7 116.0

Fixed Assets 53.8 119.5 90.5 101.6

Non Current Investments 0.7 1.2 1.2 1.2

Long Term Loans & Advances 28.5 2.0 2.0 13.2

Current Assets 498.8 393.5 409.5 17.0

Current Investments 100.9

Inventories 14.9 0.0 0.0 0.0

Trade Receivables 1.9 0.2 0.2 0.1

Cash & Bank Balances 19.8 2.5 1.2 8.5

Short Term Loans & Advances 165.4 153.5 398.1 0.5

Other Current Assets 196.0 237.4 10.0 7.9

Total 581.8 516.2 503.2 133.0

Balance Sheet


Future Outlook

FY16E FY17E

Project Launched Jan-14

Population covered 35 - 40 crore 80 - 100 crore

Geographical coverage (may change depending upon various parameters)

Vidarbha Maharashtra, Andhra Pradesh,

Karnataka, Kerala, Punjab, Himachal

Pradesh

Rest of India

Stores 3,500 – 4,000 8,000-10,000

No. of Fulfillment Centre 4 ~ 5 9 ~ 10

Expected Matured number of stores 30% of previous close 50% of previous close

Expected Average business per Matured store p.a.

20 lacs 40 lacsInitiatives Mobile commerce

Specialized Store C 2 C commerce

DIY Stores


Company : Investor Relations Advisors :

iStreet Network Ltd. CIN - L51900MH1986PLC040232Mrs. Ruchi Seksaria, Company [email protected]

Strategic Growth Advisors Pvt. Ltd.CIN - U74140MH2010PTC204285Mr. Shogun Jain/Mr. Kevin [email protected] / [email protected]

For further information, please contact

mailto:[email protected]

lnvestor Presentation FY - 2015 -16 [Company Update]

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