SUMMARY
The SAR Scheme has been amended with a view to further incentivize the eligible employees
The company specified that all eligible employees under the SAR Scheme would benefit from the changes
BookMyShow has raised over $224.5 Mn from investors like TPG Growth and SAIF Partners
Mumbai-headquartered online entertainment ticketing platform BookMyShow is on its way to join the unicorn club and has been improving its unit economics with control in losses with an increase in revenue.
To extend the benefit of such improvement to employees, BookMyShow has made new amendments to its Stock Appreciation Right (SAR) scheme in a meeting on February 12, 2020.
In simple words, a stock appreciation right is a form of bonus compensation given to employees that is equal to the appreciation of company stock over an established time period. Similar to employee stock options (ESOPs), SARs are beneficial to the employee when company stock prices rise.
The differentiation of SAR is that employees do not have to pay the exercise price, but receive the sum of the increase in stock or cash.
Hence, BookMyShow’s parent, BigTree Entertainment, in its filings with the Ministry of Corporate Affairs, has said that “the amendments to the SAR Scheme have been proposed with a view to further incentivize the eligible employees of the company, by making certain terms more favourable.”
Along with this, the company has also made certain amendments to “provide the compensation committee of the company with additional powers to implement the SAR Scheme, with a view to improve operational efficiency.”
The company specified that all eligible employees under the SAR Scheme would benefit from the suggested changes.
Some of the benefits that have been altered include:
- SARs Pool will be determined on the principle that 1000 SARs shall be equivalent to 201 shares of the company (earlier: 1000 SARs shall be equivalent to 1 share of the company)
- SARs offered under loyalty pool will vest immediately upon completion of one year of employment from the date of respective grant.
- An eligible employee who resigns from the company can vest all his SARs within 30 days after the date of termination or expiry of the period
Founded in 1999 by Ashish Hemrajani, Parikshit Dhar and Rajesh Balpande, Bookmyshow was officially launched in 2007. The platform is currently in more than 650 towns and cities across 6,000 screens in India. The company also entered the Southeast Asian (SEA) market in 2016 and has been trying to get a monopoly over the market.
In December 2019, BookMyShow raised an undisclosed amount from investment firm Jungle Ventures to shift Bookmyshow Southeast Asia operations to Singapore from India. In addition, the company also wants to invest in its tech operations and abilities to serve the audience in Southeast Asia. Overall, it has raised over $224.5 Mn across series from investors like TPG Growth and SAIF Partners.
BookMyShow has managed to narrow down its net loss by 30% from INR 161.44 Cr last year to INR 115.19 Cr in the financial year ending March 2019. In terms of revenue, Bigtree did well with a 52% hike. Bookmyshow generated INR 619 Cr in FY19 as compared to INR 406 Cr in FY18.
However, BookMyShow, Paytm Entertainment, as well as the whole movie industry, will soon be at loggerheads with Jio as it plans to launch its ‘First Day, First Show’ service, which can be enjoyed from home. Premium users of the Jio Fiber will get access to a yet-to-be-launched OTT platform by Jio, which will allow users to watch movies on the same day it is released. The launch date for this platform is said to be in mid-2020.
According to KPMG’s M&E report 2019, the industry in India posted solid growth of 13% during FY19 to reach a size of INR 1631 Bn with a CAGR of 11.5% over FY15-FY19.
