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Cineline India Ltd.

BSE: 532807 Sector: Media
NSE: CINELINE ISIN Code: INE704H01022
BSE 16:01 | 08 Aug 153.40 5.75
(3.89%)
OPEN

147.65

HIGH

153.85

LOW

147.45

NSE 15:41 | 08 Aug 151.75 3.70
(2.50%)
OPEN

148.05

HIGH

153.40

LOW

147.35

OPEN 147.65
PREVIOUS CLOSE 147.65
VOLUME 5486
52-Week high 174.75
52-Week low 74.15
P/E
Mkt Cap.(Rs cr) 484
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00
OPEN 147.65
CLOSE 147.65
VOLUME 5486
52-Week high 174.75
52-Week low 74.15
P/E
Mkt Cap.(Rs cr) 484
Buy Price 0.00
Buy Qty 0.00
Sell Price 0.00
Sell Qty 0.00

Cineline India Ltd. (CINELINE) - Chairman Speech

Company chairman speech

TAKING CONFIDENT STRIDES DURING CHALLENGING TIMES

Dear Shareholders

It is my pleasure and privilege to share with you highlights of what was anunprecedented year of global crisis. At the outset my sincere thoughts are with everyonewhose lives have been adversely impacted by the menace. I would also like to express myheartfelt gratitude to all the frontline workers who have bravely worked without fear orfatigue in our fight to overcome the pandemic.

I am pleased to present our 19th Annual Report for the year 2020-21. What clearlystands out is the fact that despite strong challenges we have been able to sustain growthwith our agility and flexibility diversifying operations to foray into new verticals andthus also expanding horizons.

Operating environment

With the onset of the COVID-19 pandemic the world saw lockdowns across countries tocurtail the speed at which the virus was spreading. Such lockdowns were undertaken inIndia as well which not only disrupted trade and restricted travelling but also broughtthe Indian economy to a standstill. Owing to these reasons the Indian economy contractedby 7.3% in 2020-21 vis--vis the growth of 4.2% in 2019-20. These macro scenarioscoupled with the sluggish growth of the real estate sector during 2020-21 and the shutdownof operations at malls and movie theatres translated into strong headwinds for us.

Expanding horizons

Against the backdrop of a challenging operating environment Cineline India undertookproactive measures to sustain its growth trajectory which has been consistent for years.We realised the importance of diversifying our operations to ensure long-term valuecreation for all our stakeholders.

The fact that diversification is the key to long-term holistic dawned upon us while wewere brainstorming on how to overcome an unprecedented year as 2020-21.

Armed with this insight we swiftly scanned the horizon for new sectors where we couldleverage our existing strengths and expertise. The hospitality sector held both thepotential and the promise we were looking for. We diversified foraying into thehospitality vertical. During 2020-21 we acquired R&H Spaces Private Limited who hasan operational hotel in Goa namely Centric Hyatt Goa. The hotel is strategically locatedin the heart of North Goa proximal to Candolim and Calangute beaches. With an all-daydining multi-cuisine restaurant 6000 square feet of banquet area 2500 square feet ofspa area and as many as 167 state-of-the-art rooms the hotel is well equipped to caterto diverse needs of people.

With the COVID-19 conundrum in full swing we figured that the restrictions oninternational travel will remain for at least the next 2 years. International tripswould be translated into domestic travel and this would exponentially boost the Indianhospitality sector. Goa is one of the most visited travel destinations of the country andis poised to make the most of these tailwinds. Our hotel at Goa was operational at a 90%occupancy from January 2021 to March 2021 validating our rationale for foraying into thisnew vertical.

The expansion of our presence across newer verticals helped us ensure that our businessis adequately de-risked. With the malls and movie theatres being shut our parkingand advertisement income was severely impacted. The additional income from the hotelbusiness not only helped us grow our top-line but also set-off the losses from theparking and advertisement business.

Financial performance

On the back of our successful diversification of operations we successfully sustainedour financial performance during 2020-21. Our total revenues consolidated basis during2020-21 stood at Rs. 5440.8 lakhs compared to Rs. 4221 lakhs in 2019-20 registering ay-o-y growth of 28.9%. Our EBITDA during the year stood at Rs. 3782.92 lakhs compared toRs. 3339.43 lakhs in 2019-20 growth owing to our proactive cost control measures.

Further our profit after tax stood strong at Rs. 478.64 lakhs in 2020-21 compared toRs. 763.29 lakhs in 2019-20.

During the year under review our rental income stood at Rs. 1592.18 lakhs followedby our interest income at Rs. 2567.28 lakhs from inter corporate deposits. Our incomefrom the hotel business during the year stood at Rs. 1128.50 lakhs in 2020-21 from 3months of operation. Our income from windmill stood at Rs. 152.83 lakhs in 2020-21.

Response to COVID-19

The COVID-19 pandemic impacted our performance in the first quarter of 2020-21 beforeheading for a recovery from the second quarter of 2020-21. With our malls and theatres notin operations for a long tenure during the fiscal our parking and advertisement incomesuffered extensively. However the rental income was only marginally impacted owing to thelong-term lease with the customers.

As I have adequately covered the big learning of this pandemic for us has beendiversification of operations.

During the relaxation phases we operated in compliance with the state and centralgovernment guidelines and protocols to ensure health and safety of our employeescustomers and the people visiting movie theatres and malls. We adhered to periodicsanitisation of our rental assets conducted thermal screening of people entering thefacilities supervised people to ensure they are wearing masks at all times and promotedsocial distancing. We also restricted the number of people entering the facilities to alimit set by the state government. We adopted a ‘work from home’ culture for allour corporate employees and also conducted thermal screening and sanitisation of office.

Outlook

After contracting at 7.3% in 2020-21 the Indian economy is expected to grow at 9.5% in2021-22 on the back of a recovering economy mass vaccinations and with the countrygradually heading towards normalcy. Such macro tailwinds coupled with the rapiddiversification of our business we are optimistic of our growth prospects in the medium-and long-term future. Owing to our proactive measures undertaken during 2020-21 tostrengthen the business we are expecting to grow our revenues generated by hospitalityvertical substantially in addition to sustaining our revenue contribution from rentalassets. Our parking and advertisement income is expected to clock a 25% y-o-ygrowth in 2021-22 helping us grow both our top-line and bottom-line. Being drivenby the sheer will to create incremental value for all our stakeholders we willproactively keep looking for attractive investment avenues.

Acknowledgement

I would like to thank the members of the Board for their support and counsel. I wouldalso want to express my warm regards to our entire team who has empowered and enabled thediversification of the business in the year gone by. I would like to express myappreciation for the unstinted faith and trust shown by our customers shareholders andinvestors.

Regards

Rasesh Kanakia

Chairman

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