Advertising

opportunityKannur International

Airport Limited Kannur gives

Kerala new

wings

2

Agenda

1 Overview and Opportunity for

Advertising BusinessBidding Process 2

3 4 Technical and Financial

EvaluationEligibility Criteria

3

Kannur International Airport – the new gateway to Kerala

1. Kannur Airport, the fourth international airport in Kerala, was set up on a on

Public Private Partnership (PPP) Model on a 2,300 acre land parcel

2. The airport recently achieved a major milestone of handling over 1.5

Million passengers in 12 months, an unprecedent growth for a

greenfield airport, compared to other airports in Kerala

3. Initial passenger forecasts suggest that Kannur International Airport

(Kannur Airport) has the potential to realize a passenger throughput of 5

Million in 5 years and 10 Million in 10 years

4. The ratio of Passengers to Meeters & Greeters stands at 1:5* leading to

high eyeball hits for advertising

5. Currently, four airlines - Indigo, Go Air, Air India Express and Air India

operate from Kannur Airport:

4

1.7

5.1

2.0

Pax Traffic in Mn (Apr,19-Sept,19)

1

Kozhikode

Kannur

Trivandrum

Cochin2

3

4

0.8

3

2

1

Kannur

International

Airport Limited

Sr. No. Air Traffic Movements (ATMs) # of ATMs

1. Domestic 150

2. International 112

Total 262

*Estimates from preliminary primary interactions

4

A business opportunity driven by growing demand

Indian carriers

deploying additional

capacity in Kannur

Increase in bilateral

agreements

India’s double digit

aviation growth story

Assumptions supporting Kannur’s growth story

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

International 0.85 1.06 1.27 1.48 1.68 1.89 2.10 2.31 2.52 2.73 2.94

Domestic 1.09 1.44 1.79 2.14 2.49 2.84 3.19 3.54 3.89 4.24 4.59

Total 1.94 2.50 3.06 3.61 4.17 4.73 5.29 5.85 6.41 6.97 7.53

-

1.00

2.00

3.00

4.00

5.00

6.00

7.00

8.00

Passenger Forecast in Millions

International

Domestic

Total

These forecasts are constrained estimates. Port of Call status by 2021, could help Kannur Airport realize a passenger throughput of 10 million by 2030.

These estimates are indicative, the bidders have to do their own diligence to determine their business case.

Kannur airport is estimated to serve 7.5 million passengers by 2030

5

Supported by capacity augmentation by airlines

2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030

ATM Forecasts

Domestic International

15,947

20,456

24,483

28,745

32,947

37,195

41,406

45,82250,238

54,653

59,068

3,942

11,396

609

2020

Turboprop Narrowbody Widebody

8,318

45,507

5,243

2030

Turboprop Narrowbody Widebody

AIR

CR

AF

T W

ISE

AT

M S

PL

IT 2

020 v

s 2

03

0

*Constrained forecast

Kannur Airport is expected to have 162 flights per day by 2030*

6

Kannur International Airport embarked its journey with a set of aspirations…

A multi-modal center that will

reposition Kannur as the gateway

for passengers and ‘Emporium of

Spice trade’ for the Indian sub-

continent

Gateway Airport

to the Malabar

A catalyst for tourism growth that

enhances the tourism potential

of ‘Gods own country’

Tourism

enabler

A smart and codependent

ecosystem that promotes

economic activities across

sectors in close sync with the

growth of airport

An

Aerotropolis

Catalyst to unlock Malabar’s socio-economic potential

Becoming the tourism axis for Malabar, Waynad, South Karnataka , Coorg

Access to 1,800 acres of land for development, leading to more advertising opportunities

Airport which is technologically

mature in order to enhance value

for all stakeholders

Tech enabled airport

Increase in land value owing to

interventions by right strategic

stakeholders to generate

demand and develop the airport

as a commercial hub

Land Value

Optimizer

7

Supported by strong business and growth levers...

Tourism

• Beaches, backwaters,

ayurveda centers, Kerala

folklore

• Alternate gateway to Coorg,

Mysore and Mangalore

• Wellness resorts/centres and

Hajj traffic

Emigrant traffic

• NRK from Northern Kerala –

Middle East, Europe and SEA

• Almost 50% of Kerala

emigrants are from districts

such as Kasargod, Kannur,

Kozhikode, Wayanad and

Malappuram

Large parcel of Land

1800 acres of land area available

for utilization for:

• Integrated Aerotropolis

• Airport development

Developing economic landscape

within the catchment area

Malls, schools and business

complexes coming up in the area

Primary Catchment

Kannur, Wayanad and

other parts of North Kerala

Kannur International Airport

Primary catchment

Secondary catchment

Secondary Catchment

• Dakshin Kannada (Mangalore

– 165 Kms)

• Coorg (70 Kms) , Mysore (128

Kms)

• Malappuram (134 Kms) and

Kozhikide (92 Kms)

Key Business Drivers

8

Aided by NRKs – a key target segment…

Kannur District Indicator Value

Area (sq km) 2,966

Population (2011) 2.523 Million

Age group distribution (2011) 0-14: 23%, 15-59: 64%, 60+: 13%

Literacy Rate (2011) Male: 97.54%

Female: 93.57%

GSVA (2017-18, constant prices), INR 316,054 million

Per capita GSVA (2017-18, constant prices), INR 121,559

Number of Non-resident Keralites (NRKs) 3.44 lakh (3rd highest among districts in Kerala)

Top 5 destination countries for emigrants from KeralaUAE – 39.1%, Saudi Arabia – 23%, Qatar – 8.7%

Oman – 8.6%, Kuwait – 6%

Amount of NRI bank deposits in Kerala (2018), INR 169,944 crore

Growth rate of NRI deposits (2013-18) 20.75%

Source: Economic Review 2018, Kerala State Planning Board

A significant number of passengers traveling through Kannur Airport comprise of non-resident Keralites (NRKs) - emigrants settled

predominantly in the Gulf countries

Remittances sent by these NRKs has played a significant role in the development of Kerala in general and Kannur in particular

Airport advertising targeting the NRKs could be highly effective in Kannur Airport, given the target segment eyeball hits

9

Bidding Process

• The Bidder may be a single entity or a group of entities/existing joint venture, coming together to implement the Project

• Term – 7 years

• Document Fee – An amount of INR 100,000 (One lakh rupees only)

• Bid Security - An amount of INR 1,000,000 (Ten lakh rupees only)

S No Event description Date

1. Reconnaissance Visits by Prospective Bidders* On or before 27 February 2020:1700 hrs

2. Last date for receiving queries 26 February 2020; 1700 hrs

3. Pre-Bid Conference 28 February 2020; 1130 hrs

4. Kannur Airport response to queries latest by 4 March 2020

5. Bid Due Date / Bid Submission Date 13 March 2020; 1400 hrs

6. Opening of Qualification Bids 13 March 2020; 1600 hrs

7. Evaluation of Qualification Bids 3 days from Bid Due Date

8.Financial Proposal Opening for Qualified Bidders &

Announcement of Selected Bidder6 days from Bid Due Date

9. Issue of Letter of Award (LOA) Within 7 days of Financial Bid Opening

10. Signing of Advertising Agreement Within 30 days of Letter of Award

10

Bidding Process

Bidding

Authority has provided:

• Terms of Bidding

• Eligibility & Evaluation Criteria and

• Scope of Work

Award of project

• Kannur Airport has provided for a single-stage process for selection of bidder.

Financial Bid

Qualification Bid

Bids from bidders

Qualification Bid

Eligibility Criteria

✔

Financial Bid Financial Bid Evaluation

11

Eligibility CriteriaTechnical Eligibility

The Bidder (in case of consortium, the Lead Member) must have minimum 4 (four) years of experience in the

last ten financial years (FY 08-09 to FY 18-19) as an Advertising Licensee in at least 2 (two) airports in India

or abroad, of which at least 1 (one) airport must be handling more than 2 million passengers per annum during

each year of the Agreement.

Financial Eligibility

The Bidder, along with its group subsidiaries, must have achieved average annual turnover of at least INR

20,00,00,000/- (Rupees Twenty Crore) in past three (3) financial years (preceding FY 2019-2020)

(“Financial Capacity”).

12

Evaluation

• The Bid Parameter will be the total Minimum Guaranteed Fee payable by the Bidder over the duration of the Term.

• The Minimum Guaranteed Fee for each year will be calculated based on the Revenue Share Percentage as well as

the Projected Gross Revenue quoted by the Bidder in the Financial Bid.

No Year 1 2 3 4 5 6 7

a) Projected Gross Revenue –

quoted by bidder

100 200 300 400 500 600 700

b) Revenue Share Percentage –

quoted by bidder

70% 70% 70% 70% 70% 70% 70%

c) Minimum Guaranteed Fee payable -

a) × b)

70 140 210 280 350 420 490

• The total Minimum Guaranteed Fee for the duration of the Term comes out to be 1,960. This calculation will be

done for all Bidders and the one with the highest value of Minimum Guaranteed Fee shall be the Selected

Bidder

• A sample calculation is shown below.

Minimum

Guaranteed Fee

Projected Gross

RevenueRevenue Share

Percentage

13

Expectations from the Advertising Licensee

1. Digital spaces and use of technology – The Advertising Licensee is expected to leverage the latest technology for

development of advertising spaces at Kannur Airport. This would include, inter alia, development of state-of-the-art

digital advertising spaces and using innovative technology for advertising.

2. Designs and materials to match with the aesthetics of the airport – The Advertising Licensee shall develop the

advertising infrastructure in such a manner that it blends smoothly with the overall aesthetics and general features of

the airport. The quality and type of materials used for building the infrastructure should match with those used in the

airport.

3. Locations – Work with Kannur Airport for development of advertising locations both inside the terminal building as well

as other spots in the airport land.

4. Brands and Partnerships – Develop long-term partnerships with contemporary brands and advertisers to enhance the

passenger experience at Kannur Airport.

14

Annexures

15

Potential Media Bucket at Kannur Airport

High Value Mid - Low Value

Ambient Lit Billboard - Large Format Ambient Lit Billboard - Small Format

Video Wall Pillar Branding

Gantries - Access Roads Escalator Branding

Unipoles - Access Roads Baggage Belt - Arrival

Backlit box - Large Format Ceiling Dropdowns

Fixed Digital Asset - Large Branding of FIDS & other information screen

Aerobridge - Exterior & Interior Washroom Branding

Landmark Installations Baggage Trolleys

Product Displays Queue Managers

Promotion / Activation Glass Facade - Small Size

Glass Facade - Large Size Digital Standees

Content Partner for Entertainment Screens Planters / Green Area Branding

16

Potential Advertising Locations – Departures (1/2)

17

Potential Advertising Locations – Departures (2/2)

18

Potential Advertising Locations –International SHA

19

Potential Advertising Locations – Arrivals (1/2)

20

Potential Advertising Locations – Arrivals (2/2)

21

Potential Advertising Locations – Baggage Handling Area

22

Potential Advertising Locations – Escalators near Arrival

Thank you!