Future Retail Limited

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13th February, 2020 To, Dept. of Corporate Services {CRD) BSE Limited Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai-400 001 Listing Department National Stock Exchange of India Limited Sandra

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Quick Recap of 14th Nov’ 2019 5 Pillars of FRL’s Transformation Journey Key Transformational Pillars 1 Efficiencies & focused execution 2 Strong cashflow generation Driving efficiency savings of ~Rs

Rs 160

Efficiencies & focused execution 2 Strong cashflow generation Driving efficiency savings of ~Rs 160 – 200 cr / yr across corporate OH & store costs (marketing, rental, employee & utilities) Drive

50%

res in 3-6 months (run- rate) Deliver operating cashflow (post capex) to EBITDA conversion of ~50% – targeting monthly ~Rs 200cr EBITDA & Rs 100cr free cashflow by Feb/ Mar ’20 Will deliver thi

Rs 200

ate) Deliver operating cashflow (post capex) to EBITDA conversion of ~50% – targeting monthly ~Rs 200cr EBITDA & Rs 100cr free cashflow by Feb/ Mar ’20 Will deliver this through EBITDA expansion f

Rs 100

ting cashflow (post capex) to EBITDA conversion of ~50% – targeting monthly ~Rs 200cr EBITDA & Rs 100cr free cashflow by Feb/ Mar ’20 Will deliver this through EBITDA expansion from efficiencies a

20%

deleveraging Deleverage balance sheet through strong cashflow generation and superior ROCEs (>20% post tax ROCE in next 36 months) Targeting Net Debt/EBITDA of ~1.5x in 24 months (by April 2021)

1.5x

ration and superior ROCEs (>20% post tax ROCE in next 36 months) Targeting Net Debt/EBITDA of ~1.5x in 24 months (by April 2021) and <0.2x in 3 years 4 Full unwind of RPTs with FEL On track to

0.2x

tax ROCE in next 36 months) Targeting Net Debt/EBITDA of ~1.5x in 24 months (by April 2021) and <0.2x in 3 years 4 Full unwind of RPTs with FEL On track to buyback store assets from FEL by Marc

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ext 36 months) Targeting Net Debt/EBITDA of ~1.5x in 24 months (by April 2021) and <0.2x in 3 years 4 Full unwind of RPTs with FEL On track to buyback store assets from FEL by March ’20at arms len

Rs 650

at arms length fair value Post-buyback, all RPTs with FEL to be unwound across lease rentals (~Rs 650 cr/yr). All corporate guarantees provided by FRL on behalf of FEL (~Rs 3,600cr) will be fully re

Rs 3,600

ross lease rentals (~Rs 650 cr/yr). All corporate guarantees provided by FRL on behalf of FEL (~Rs 3,600cr) will be fully removed. 5 Key Enablers: Rakesh Biyani (Joint Managing Director) has been fully

“All corporate guarantees provided by FRL on behalf of FEL (~Rs 3,600cr) will be fully removed.”

“§  177 small format stores have been closed: These were a mix of new low-density clusters or bottom of the tail stores Small-format Stores §  Over the past 2 months, management has taken several efficiency-led initiatives and the initial results of those are encouraging §  FRL is on track for achieving the stated target of break-even by Sep’ 2020.”

“§ In line with above changes, it is also proposed to identify a suitable potential candidate, for the role of CFO, who will be responsible for driving robust business planning, monitoring systems across the businesses, interface with all stakeholders including investors & further strengthen the governance.”

“•  Operating lease expenses will be replaced by Depreciation and interest expenses.”

“The Company cannot guarantee that these assumptions and expectations are accurate or will be realized.”

Key Transformational Pillars

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New stores opened during the quarter

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APPENDIX

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RETAIL

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Key Transformational Pillars

Update FRL | Presentation | February 2020 3 3 Key Management Focus Areas: Quick Recap of 14th Nov’ 2019 5 Pillars of FRL’s Transformation Journey Key Transformational Pillars 1 Efficiencies & focused execution 2 Strong cashflow generation Driving efficiency savings of ~Rs 160 – 200 cr / yr across corporate OH & store costs (marketing, rental, employee & utilities) Drive SSSG in large format across network through leadership in key cities Breakeven of Small format stores in 3-6 months (run- rate) Deliver operating cashflow (post capex) to EBITDA conversion of ~50% – targeting monthly ~Rs 200cr EBITDA & Rs 100cr free cashflow by Feb/ Mar ’20 Will deliver this through EBITDA expansion from efficiencies and margin uplift, tightly managing working capital, and minimal new store capex 3 Balance sheet deleveraging Deleverage balance sheet through strong cashflow generation and superior ROCEs (>20% post tax ROCE in next 36 months) Targeting Net Debt/EBITDA of ~1.5x in 24 months (by April 2021)

New stores opened during the quarter

œ  3 Big Bazaar stores œ  2 fbb stores Total Retail Area (mn sq.ft) 16.1 16.1 14.5 12.5 11.6 10.0 FRL Presentation | Feb 2020 21 FY15* FY16* *Excluding HomeTown (Like for Like) FY17* FY18 FY19 Dec '19 Big Bazaar Profit Club: Growing at 2x monthly rate, now in fashion also BBPC Members (mn) 1.0 0.3 With 1 lakh+ Dec '18 Dec '19 ~10 lakh members Average ticket size of > ₹2,000 ~20 Average Yearly store visits ~ ₹40,000 Average annual spend per user FRL Presentation | Feb 2020 22 Easyday Savings Club: Engine of throughput to small stores Easyday Club Members (in mn) 1.4 Total Members >1.4 million Average ~1,800 members per store Members visit 4-5 times a month 0.96 Dec '18 Dec '19 Annualized spend per member ~₹ 30,000 Membership active in 794 stores Member-centric high-value ecosystem FRL Presentation | Feb 2020 23

APPENDIX

Impact of IND AS – 116 FRL | Presentation | Feb 2020 24 2 4 Key Aspects of IND AS 116 •  New lease standards effective from 1st April 2019. •  No distinction between finance lease & operating lease. •  All leases to be recognized in the balance sheet as an Asset and Liability. •  The lease liability is measured at present value of minimum lease payments to be made over the lease term. •  The right to use asset is initially measured at the amount of the lease liability, adjusted for lease prepayments, if any •  Right to use is depreciated over a lease term on a straight-line basis. Interest is added on lease liabilities and actual payments are reduced from the liabilities balance. •  Operating lease expenses will be replaced by Depreciation and interest expenses. •  Exemptions available in the standard is pertaining to short term leases (<= 12 months) and assets having low values. FRL Presentation | Feb 2020 25 Quantification of Adjustments Standalone Income Statement (Q3FY20) Revenue I

RETAIL

RIGHT NEXT TO YOU This report contains forward-looking statements, which may be identified by their use of words like ‘plans’, ‘expects’, ‘will’, ‘anticipates’, ‘believes’, ‘intends’, ‘projects’, ‘estimates’, or other words of similar meaning. All statements that address expectations or projections about the future, including but not limited to statements about the Company’s strategy for growth, product development, market position, expenditures, and financial results are forward-looking statements. Forward-looking statements are based on certain assumptions and expectations of future events. The Company cannot guarantee that these assumptions and expectations are accurate or will be realized. The Company’s actual results, performance or achievements could thus differ materially from those projected in any such forward looking statements. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent developments