CREATIVE NEWTECH LIMITED — Interim / Quarterly Report 2022

Nov 14, 2022

Result Update Presentation Q2 & H1 FY23

Creative Newtech Limited

(Formerly known as Creative Peripherals and Distribution Limited)

Disclaimer

This presentation has been prepared by Creative Newtech Limited (the "Company"), formerly known as Creative Peripherals & Distribution Ltd., solely for information purposes and does not constitute any offer, recommendation or invitation to purchase or subscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment what so ever. No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information about the Company.

This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Company makes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, the truth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive and may not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, this Presentation is expressly excluded.

Certain matters discussed in this Presentation may contain statements regarding the Company's market opportunity and business prospects that are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertainties include, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performance of the industry in India and world-wide, competition, the company's ability to successfully implement its strategy, the Company's future levels of growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company's market preferences and its exposure to market risks, as well as other risks. The Company's actual results, levels of activity, performance or achievements could differ materially and adversely from results expressed in or implied by this Presentation. 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 not adopted by the Company and the Company is not responsible for such third party statements and projections.

Company at a Glance

Diversified Products Portfolio

• 1. Licensee of Honeywell Inc.
• 2. 25+ Brands under said segments (FMSG+FMCT+FMEG+EB)
• 3. 8000+ Trusted partners

Total 20+ branches in India

25+ Brands 3200+ Products 8000+ Happy Channel Partners 1992 Started Journey 564 Cr Market Cap *

Business Overview

	Brand Licensing(like Jubilant food –Dominos Pizza &Page Industries –Jockey Comfort wear)	FMSG + FMCT + FMEG + EB	CKart
About	•Currently Honeywell License Holder and offers a vastsuite of products spanning consumer to enterprisesegments -fromEnhancement products for laptops,smartphones & TVs, to Audio products to Air Purifiersto enterprise class infrastructure through ourStructured cabling systems offerings•More products to be added to the Honeywell portfolio•Looking to expand more categories and geography	•FMSG: Niche Products that appeal to the youngerdemographics, driven by social media penetrationFMCT: This segment includes established and fast•moving consumer products that cater to personalas well as organizational demandsEB: Products supplied to enterprise in higher•volumes•FMEG: Offers Electronics Goods	•Online digital B2BeCommerce platform•Captive marketplace forsubscribed businesspartners.•Boosts customer-basewithout additionalmanpower
Brands	Honeywell	Samsung, Cooler Master, Insta360, Fujifilm, Hyperice,PNY, BaByliss, Olympus, Zeiss, Transcend, SamsungCE, iBall, ViewSonic, BPL, Printronix among others

• Exclusive trademark license from Honeywell covers 38 countries spanning South East Asia, South Asia, Middle East Asia and Africa
• A Market entry specialist for niche brands
• Offering experiential products and enabling niche global brands to enter and establish newer markets

End to End Service Provider - Honeywell

in sales for 2020 ~$33 Bn

of sales outside U.S. 53%

More than, ~129,000 employees Morris Plains, N.J. Headquarters

Fortune 100

NYSE: HON

Aerospace $11.5 Bn

Building Technologies $5.2 Bn

Performance Materials & Technologies $9.4 Bn

Safety and Productivity Solutions $6.5 Bn

5

Honeywell developed the first autopilot flight controller(1914),first commercial weather radar system (1954), first business jet turbofan engine (1975), and is still the leader in developing revolutionary technology for aerospace today.

Honeywell began the Smart House project to combine heating, cooling, security, lighting, and appliances into one easily controlled system. They continued the trend in 1987 by releasing new security systems, and fire and radon detectors.

Honeywell is the leader in gas detection, fire systems, personal protective equipment, building controls, home comfort and security and scanning and mobility.

Honeywell's technology is used to produce 40% of the world's liquefied natural gas, 60% of the world's gasoline, 70% of the world's polyester, and 90% of the world's biodegradable detergents.

Honeywell

Exclusive rights to sell across 38 countries

Honeywell

Tough Entry Barrier & Hyper Growth Ahead

Entry Barrier

The biggest entry barrier to breakthrough in Honeywell is the long-drawn compliance process and product approval including certifications.

Approval Process

The process of getting approval for each product is time consuming and expensive.

Launch of Products

We have spent last 4-5 years in getting the approvals for the products and now we are ready to launch several new products in coming months.

Our Partners

To be updated

8

Target addressable Market

FMSG – Key Drivers for Growth

• The trend to capture every moment of social life and post live events has led to a multifold growth in personal-use, Internet connected devices
• Every millennial tends to follow multiple hobbies which has led to growth in pursuing trekking, wildlife photography/tours, sports, cooking, music etc and this has made this segment one of the fastest growing segments across globe.
• The consistent increase in sedentary work and increased health and beauty consciousness has led to an exponential increase in demand for home recovery equipment (HYPERICE), home grooming products (BABYLISS) and Gaming accessories (Cooler Master)

Global Gaming Industry

The growth in global gaming sector has been fuelled by

• increasing trends of online/digital gaming, urbanisation and faster network infrastructure
• The robust growth in smartphone penetration

$300 Bn

Gaming industry presently exceeds $300 Bn

400 Mn

Over 400 Mn new gamers are likely to join by 2023

$2.7 Bn

Currently there are 2.7 Bn people in the gaming sector

CAGR 11.9%

The sector is expected to grow at a CAGR of 11.9% between 2020-26

• Rising awareness regarding fitness

The market size was estimated $10.97 Bn in 2021

$15.25 Bn

Expected to reach $15.25 Bn by 2026

https://www.thebusinessresearchcompany.com/report/social-media-global-market-report#:~:text=The%20global%20social%20media%20market,(CAGR)%20of%2039.7%25.

Q2 FY23 Financial Highlights –Standalone & Consolidated

	StandaloneConsolidated
INR Crore	Q2 FY23	Q2 FY22	YoY %	Q2 FY23	Q2 FY22	YoY %
Revenue from Operations	306.02	237.57	2881%	319.14	238.56	33.78%
Other Operation Income	7.14	2.65	169.28%	7.14	2.65	169.31%
Total Income	313.16	240.22	30.36%	326.27	241.21	35.26%
Cost of Goods Sold	293.10	225.01		297.42	222.37
Employee Cost	3.55	2.62		3.55	2.62
Other Expenses	7.21	5.87		12.03	7.56
Total Expenditure	303.85	233.50		313.00	232.54
EBIDTA	9.31	6.72	38.49%	13.47	8.67	53.10%
EBIDTA Margin %	2.97%	2.80%	17 bps	4.07%	3.59%	48 bps
Interest	2.05	1.19		2.08	1.21
Depreciation	0.43	0.35		0.43	0.35
Exceptional Items	0.00	0.00			0.00
Profit Before Tax	6.82	5.17		10.76	7.11
Tax	1.66	1.27		1.66	1.27
PAT	5.16	3.90	32.23%	9.10	5.84	55.79%
PAT Margin	1.65%	1.62%	3 bps	2.79%	2.42%	37 bps

• Strong sales growth driven by FMSG and FMCT segments
• High demand for brands such as Samsung, Honeywell, Cooler Master & View Sonic among others
• Higher Sales Promotion and higher Freight and Clearing charges impacted margin growth

H1 FY23 Financial Highlights Standalone & Consolidated

		StandaloneConsolidated
INR Crore	H1 FY23	H1 FY22	YoY %	H1 FY23	H1 FY22	YoY %
Revenue from Operations	533.97	369.33	44.58%	557.84	372.45	49.78%
Other Operational Income	12.46	4.64	168.59%	12.47	4.64	168.61%
Total Income	546.44	373.97	46.12%	570.31	377.09	51.24%
Cost of Goods Sold	508.14	344.70		519.76	344.19
Employee Cost	7.05	5.55		7.05	5.55
Other Expenses	14.62	11.11		22.56	14.57
Total Expenditure	529.81	361.36		549.37	364.31
EBIDTA	16.62	12.61	31.84%	20.94	12.78	63.78%
EBIDTA Margin %	3.04%	3.37%	-33 bps	367%	3.39%	28 bps
Interest	4.10	2.52		4.14	2.55
Depreciation	0.79	0.65		0.79	0.65
Exceptional Items	0.00	0.18		0.00	0.18
Profit Before Tax	11.74	9.26		16.00	9.41
Tax	2.87	2.34		2.87	2.34
PAT	8.87	6.92	28.31%	13.13	7.07	85.77%
PAT Margin	1.62%	1.85%	-23 bps	2.30%	1.87%	43 bps

• Strong sales growth driven by EB and others
• Higher Sales Promotion and higher Freight and Clearing charges impacted margin growth FMCT segments
• High demand for brands such as Samsung, Honeywell, Cooler Master & View Sonic among

Consolidated Balance Sheet Highlights as on 30th September 2022

INR Crore	As on	As on
	30th Sept 2022	31st March 2022
Equity	107.61	88.37
Equity Share Capital	12.60	12.00
Other Equity	86.94	68.62
Money Received AgainstShare Warrant	0.00	1.65
Minority Interest	8.07	6.10
Non-Current Liabilities	10.86	11.33
Long Term Borrowings	9.77	10.38
Other Long Term Liabilities		-
Other Long Term Provisions	1.09	0.95
Current Liabilities	164.60	153.44
Short Term Borrowings	62.95	53.97
Trade Payables	71.27	63.87
Other Financial Liabilities	22.66	26.64
Other Current Liabilities	5.55	7.94
Short Term Provisions	0.14	0.14
Current Tax Liabilities (Net)	2.03	0.89
Total Equities & Liabilities	283.08	253.14

	As on	As on
INR Crore	30th Sept 2022	31st March 2022
Non-Current Assets	10.39	10.73
Property, Plant & Equipment	9.99	10.38
Intangible Assets	0.17	0.18
Non-Current Investments	-	-
Net Deferred Tax Asset	0.23	0.17
Long Term Loans & Advances	-	-
Other Non Current Assets	0.00	0.00
Current Assets	272.69	242.41
Inventories	88.24	97.02
Trade Receivables	109.95	84.77
Cash & Cash Equivalents	3.60	2.86
Bank Balances other thanabove	5.48	5.38
Other Financial Assets	0.05	0.05
Other Current Assets	65.37	52.33
Total Assets	283.08	253.14

Segmental Revenue

*Sales in Crore

24

FMSG : Fast Moving Social-Media Gadgets FMCT: Fast Moving Consumer Technology FMEG: Fast Moving Electronics Goods EB: Enterprise Business

High Growth, High Margin and Small Working Capital cycle - the Criteria

11

And it is working…

*Sales in Crore

FMSG : Fast Moving Social-Media Gadgets FMCT: Fast Moving Consumer Technology FMEG: Fast Moving Electronics Goods EB: Enterprise Business

Annual Consolidated Financial Highlights FY22

** FY21 Covid Year

Financial Highlights in Charts

Sales in Crore

Revenue (in Cr)

EBITDA (in Cr) PAT (in Cr)

23

*RoE = Net Profit/Net Worth | RoCE = EBIT/(Shareholders Fund + Long-term Borrowing + Short-term Borrowing-Non-Current Investment)

** FY21 Covid Year

Future Ready Business Growth

Brand Licensing in New markets

Bringing Cutting-edge Technologies through highmargin brands

Digitizing business for optimal profitability

#1 Brand Licensing & Geographical Expansion

• Growing brand licensing line of business with long-standing association with Honeywell with extensive product portfolio
• Expanding geographically in new countries across Middle East & APAC with required approvals & certifications in place

#2 Diversifying product portfolio across new high-potential verticals

• Bringing diverse product ranges across various consumer verticals such as gaming & lifestyle, to stay ahead of trends
• Focus on fast moving high-margin brands such as Cooler Master, Hyperice etc.
• Utilize & expand omni-channel network to capitalize on maximum reach across India

#3 Ckart to boost profitability & working capital

• Online B2B eCommerce platform to help expand customer-base substantially without additional manpower
• Seller module making the platform a virtually open marketplace for all supply chain partners
• With addition of new channel partners on the platform, working capital cycle to improve

Investment Rationale

Industry experience of ~30 years Addresses niche growing market across segments

Exclusive licensee for Honeywell

Expecting significant growth from increased volumes in Honeywell Consumer products portfolio, for which it is the exclusive licensee in 29 countries spanning SAARC, the Middle East and APAC

One of India's leading Brand Licensee and Market Entry Specialist

It is one of the few national players in the space to provide end-to-end solution from contract manufacturing to retail distribution and brand licensing

Strong return ratios

Creative Newtech has an ROCE of 20.38% and it outpaces the average of 10% earned by companies in a similar industry

Associated with well-known brands

Partner with Samsung, Cooler Master, BPL, Olympus, Fujifilm Instax, Hyperice, Philips, Rapoo, Insta 360, Transcend, ViewSonic, Printronix, Zeiss, BaByliss, Colorful, Edelkrone, InVue, MSI, EPSON etc.

Good entry point for well-known foreign brands

Provide strategic intel to foreign players to enter into Indian market

An Omni-channel network that spans Online, offline and retail trade channels

It offers 25+ brands, 3200+ products, 8000+ happy channel partners and 50,000+ metric tons (across its product range) of monthly import and export

Management Comment 22

Commenting on the Company performance, Mr. Ketan Patel, Chairman & Managing Director of Creative Newtech said:

"As we were about to overcome uncertainties related to COVID-19, the Russia- Ukraine crisis escalated. Despite the macro shocks, we believe that India's economic fundamentals are strong and keeping aside these turbulences, the impact on the long-term outlook will be marginal.

In Consolidated performance for the quarter ended September 2022, we reported a 35.26% YoY growth in total income at Rs. 326.27 Cr., with EBITDA and net profit growing 53.10% and 55.79 % YoY at Rs. 13.27 Cr. and Rs. 9.10 Cr., respectively. This growth was primarily supported by demand for new and existing products from brands like Samsung, Honeywell, Cooler Master and View Sonic along with higher overseas sales.

In the first quarter, we bagged distribution rights for Lexar across India. Lexar being a global leading brand in providing memory solutions would strengthen our FMSG product segment.

We are pleased to announce that we are now licensee for Honeywell across 38 countries. With the addition of the new geographies and the synergies from the Honeywell portfolio will help us scale up the business and will help us grow.

We have also expanded the Category in Samsung brand by adding their Samsung Flash Memory products into our existing arrangement with them.

As consumer sentiment and market scenario improves, we are well positioned to cater to the markets while keeping a lean and efficient business model, ensuring long-term, sustainable growth for all stakeholders.

I would like to thank the entire team for their dedication and hard work which pushes the Company forward."

Management Team

A technologist with a humble background and an experience 30+ of years. With capital not an option, he had to choose a long gestation period for success. He firmly believes that in the technology business, operating leverage is substantial but always back ended.

A woman with exceptional foresight, Purvi Patel manages Logistics, HR, Marketing, Operations and Administrative functions to enable smooth functioning of the business.

Ketan Patel Purvi Patel Vijay Advani Mohit Anand

Mr. Advani is a seasoned Professional with 30+ years of experience since 1998 in Product, Sales & Operations. He looks after the complete sales of the organization and all major B2B relationships with an ease and competence like no other.

As the CEO of Secure Connection, he is responsible for all facets of the business including, Sales, Marketing, Finance & Operations. He is currently building and scaling out Honeywell licensing business in over 29 countries. Ex-Microsoft, Ex-Belkin

Management Team

Chartered Accountant with over 25 years of strong and multiindustry experience. Worked in companies like Garnier India, Novartis Consumer Health, Shringar Cinemas, etc. He was the CFO of a listed company for over 8 years, also successfully completed two IPOs in his career.

Abhijit Kanvinde Amol Patil Upendra Singh

MBA in Marketing with Engineering in Electronics and Telecom, with over 20 years of experience in IT industry. Mr. Patil's prowess lies in identifying latest market opportunities. With his excellent team management and execution skills, he is responsible for profitable management of products portfolio

Bachelor of Commerce from Ranchi University, with nearly 30 years experience in Sales & Marketing. His expertise lies in vendor management, sales generation & market penetration. He has been in the IT hardware industry for over 11 years and he drives the national channel & corporate sales.

Our Business - Quadrant Segmentation

We have ranked our products into Quadrants based on returns and working capital turns.

QUADRANT 1	QUADRANT 2
HIGH MARGINS AND	HIGH MARGINS AND
QUICK CYCLE	MEDIUM CYCLE
QUADRANT 3	QUADRANT 4
LOW MARGINS AND	LOW MARGINS AND
MEDIUM CYCLE	LONGER CYCLE

We are focussing on Quadrant 1 by dedicating our best resources towards the same.

At the same time, we are also maintaining our existing business which falls between Quadrant 2 and Quadrant 4 as it gives us visibility and foot in the door to large brands and distributors.

25

Primarily Focus - Quadrant 1

For Sustainability we have adopted this strategy that we will not disrupt our current business, at the same time we are focussing primarily on Quadrant 1 business with step-by-step diverting all our incremental resources towards the same

The Quadrant1 business are primarily FMSG and Enterprise Businesses like-

Honeywell, Cooler Master, ViewSonic, Fujifilm Instax, Invue, MSI, Rapoo, iBall, Insta360 etc. to name a few…

Key Focus and Strategy Ahead

Our business model is primarily of optimizing working capital. The success of our business depends on achieving higher growth through higher margin products and quick working capital cycle

In the last few quarters we have continuously shifted our resources towards higher profit products (Honeywell, Cooler Master, Hyperice, Samsung etc.) with faster sales cycle and agile team which clearly reflects at the charts in next slide

We gauge every opportunity through below key lenses:

• Return on Investment
• Return on Management time
• Whether it's a Experiential Brand

Growing at fast pace albeit at small base

29 Journey so far…

• 2012 Foray into Imaging business by signing Olympus

• 2013 Exclusive Photo Distribution from Vitec Group of Italy for Manfrotto

• 2013 Exclusive distribution for 5 new global IT vendors

• 2015 Reliance Digital 'Best Fulfillment Partner'

• 2015 Exclusive distribution for 8 new global brands including ViewSonic & Samsung

• Listed on NSE SME stock exchange

• Forayed into gaming products under lifestyle segment

• Agreement with TPV Technology India for Philips Digital Signage

• Expanded Honeywell licensing agreement to Middle East & added new products

• Entered Retail Security segment through Exclusive Agreement with InVue

• Launched B-Safe own brand of medical products

• Launched Ckart digital B2B platform for customers

• Expanded Honeywell mandate to 29 countries

• Tie-up with ZEISS to distribute binoculars & monoculars

• Licensing agreement with Honeywell for air purifiers

• Agreement with Edelkrone for videography accessories

• Tie-up with Reliance Retail for home appliance products

• Distribution agreement with MSi for mini-computers, and with Colorful Tech for SSDs

• Signed distribution agreement with Hyperice Inc.

• Signed distribution agreement with Insta360 for Action cameras and Hama for Photography products.

• Renamed to Creative Newtech Ltd

• Signed Distribution Agreement with Fujifilm for their Instax range of Cameras and it's accessories

• Signed Distribution Agreement with Lexar for Flash Memory and relevant accessories

▪ Started as trading concern with 2 employees ▪ Epson Dot-matrix Printer aggregator

• Microsoft sub-distribution in Maharashtra & Gujarat

• Changed name to Creative Peripherals & Distribution Pvt. Ltd.

• Opened branches in Pune, Bangalore and Ahmedabad

• Epson Business Partner

• Foray into Lifestyle business

• Forayed into retail security business

• Exclusive license for Honeywell

• Won distribution license for GoPro

• Agreement with Future Tech Electronics LED TV's for DAEWOO, MEPL & INDICOOL brands in India

• Expanded gaming product vertical via agreement with Thermaltake

• Exclusive agreement with 'iBall' for all their products in Madhya Pradesh and Vidarbha

• Migrated to NSE Main Board

• Expanded IT, Gaming & Lifestyle segments with PNY, Cooler Master & BaByliss

• Distribution agreement with Panasonic for audio products

• Expanded agreement with Honeywell for Passive Cabling

Geographical Presence

• Pan India presence.
• Over 300-strong highly skilled workforce across India – mix of young and experienced talent.

Domestic International

• Subsidiary in Hong Kong.
• Strong distribution tie-up in Middle East.
• Expanding network across SAARC countries.

Our Network

A Class Cities Mumbai – Lamington Road Mumbai – Kandivali Bangalore Chennai Delhi Kolkata Hyderabad Haryana Odisha Indore Jaipur Kerala Ludhiana Lucknow Surat Cochin

B Class Cities Ahmedabad C Class Cities

Chandigarh

Bihar Nagpur Pune Dehradun Jammu

D Class Cities

Goa North East Nasik Raipur Rajkot Varanasi

Strong network of 8,000+ partners across India & reach to 25+ regions

31 Driving Social Media Transformation through Digital Offerings

Information Network Customer Experience Scale and Skills Omni – Channel Marketing Customer Intimacy Contract Manufacturing Brand Strategy Access to Partnership Product Price Content & Community Service Customer experience 2000 2024 What is needed?

Our Value Edition

By 2024, Customer Experience will overtake Price & Product as the key brand differentiator, a shift that is already in progress.

Brand Licensing

Licensed by Honeywellfor contractmanufacturing	Rights on manyproductdesigns/casts	Can manufacture andsell Honeywellbranded products inmany APAC countries	Aiming to get moreinternational brandsunder the licensing andalso expand Honeywellbusiness line	Maintain Asset light modelwhile expanding thebusiness

FMSG + FMCT + FMEG + EB

Specialist in endto-end solutionsof FMSG forglobal brands inIndia	Well positioned in a fastgrowing country like Indiawith an aspirational youngpopulation and establishednetwork and market reach	Portfolio of 25+ worldrenowned brands,most of which aremarket leaders in theircategories	Commandniche value inmarket	Continuallyenhancing portfoliowith high-margin,high growthpotential products	Multi channelnetwork

Who we are

www.ckartonline.com

Ckart

Online digital B2BeCommerce platform	Captivemarketplace forsubscribedbusiness partners	Expands theCompany's productdomain	Boosts customer-basewithout additionalmanpower	With growing digitization inindustry, CKart paves theway for a future-readygrowth

Key Developments

To be updated

Fund Raise Activity

In July 2021, Creative undertook a preferential allotment of equity shares and warrants to raise Rs.11 Cr to fund future growth plans. Company issued 4,00,000 equity shares and 6,00,000 fully convertible warrants at Rs.110 each. The shares and warrants were allotted to Abhinav Capital Services Ltd and Shree Sumna Trade LLP.

Honeywell

• Signed licensing agreement for Honeywell Air Purifiers across 10 countries worldwide
• Expanded Honeywell distribution agreement to include 38 countries across APAC, Middle East and Africa
• Added range Home Audio products to Honeywell product portfolio

Geographical Expansion

Other than our presence in existing regions we are now also available at Varanasi, Dehradun, Chandigarh and Jammu to cater demand for fast growing Eastern UP, Uttarakhand, Himachal and Jammu & Kashmir. We have spread our wings to these new Geographies in Q1FY23.

Recent Brand Agreements

• Signed agreement with Hyperice Inc. to distribute massage & muscle recovery products
• Tied up with Insta360 to distribute range of cameras
• Signed distribution agreement with Hama Gulf to distribute their range of photography products
• Tied up with Colorful Technology to distribute SSDs
• Signed distribution agreement with MSI to supply mini-PCs and desktop range
• Signed Distribution Agreement with Fujifilm for their Instax range of Cameras and its accessories
• Signed Distribution Agreement with Lexar for Flash Memory and relevant accessories
• Expanded the Category in Samsung brand by adding their Samsung Flash Memory products into our existing arrangement with them

THANK YOU!

www.creativenewtech.com