Motilal Oswal Financial Services Limited · NSE:MOTILALOFS
Motilal Oswal Financial Services — Q4 FY2022 Earnings Presentation
43 slides from Motilal Oswal Financial Services's earnings presentation, Apr 28, 2022
Slide 1: Exchange filing cover letter
April 28, 2022 BSE Limited National Stock Exchange of India Limited P. J. Towers, Exchange Plaza, Plot No. C/1, G Block, Dalal Street, Fort, Bandra-Kurla Complex, Bandra (E), Mumbai - 400001 Mumbai - 400051 Security Code: 532892 Symbol: MOTILALOFS Sub: Investor(s)/Analyst(s) Presentation – Financial
Slide 2: Earnings Presentation Q4FY22 & FY22
Financial Services Earnings Presentation 2022 Q4FY22 & FY22 BUSINESSES FOCUS ON ALL BIZ OFFER HUGE BUILDING SCALE SUSTAINABLE GROWTH HEADROOM FOR GROWTH
Slide 3: Key Highlights for FY22
EARNINGS PRESENTATION Q4FY22 Key Highlights for FY22 Highest Highest ever Annual Highest ever AMC, Highest ever Fund Raise Highest ever AMC and Ever Revenue & Profit Wealth, Distribution by PE & RE Wealth business Annual and DP AUM Profit Performance Across Businesses Highest ever Broking Highest ev
Slide 4: A Diversified Business Model to Create Value
EARNINGS PRESENTATION Q4FY22 A Diversified CAPITAL MARKETS AS S ET MAN AGE M EN T Business Model • Highest ever yearly Broking revenue & • Highest ever yearly AMC, PE and Wealth profit. profit • Cash market share at multi-year high in to Create Value • AMC AUM stood at ₹ 490 bn, +13% YoY FY22 in FY2
Slide 5: Business-wise RoE mix
EARNINGS PRESENTATION Q4FY22 Business-wise RoE mix Group RoE* (MOFSL Consolidated) Segment-wise RoE, with % of net worth employed (NWE) CAPITAL MARKETS AS S ET & WEALTH MAN AGE M EN T 258% 173% 157% FY21 38% (3% (6% (6% (3% 92% of NWE) of NWE) of NWE) of NWE) FY22 FY21 FY22 FY21 FY22 30% HOUS IN G F
Slide 6: Consolidated Financials - Strong Annual Operating Profit Growth @ 69%
EARNINGS PRESENTATION Q4FY22 Consolidated Financials- Strong Annual Operating Profit Growth @ 69% PARTICULARS (₹ Mn) Q4FY22 Q4FY21 YOY (%) Q3FY22 QOQ (%) FY22 FY21 YOY (%) Capital Markets (Broking, Distribution & IB) 6,930 5,135 35% 7,260 -5% 25,372 17,118 48% Asset Management 1,697 1,831 -7% 1,675
Slide 7: Consolidated Financials – PAT Mix
EARNINGS PRESENTATION Q4FY22 Consolidated Financials – PAT Mix PAT (₹ Mn) Q4FY22 Q4FY21 YOY (%) Q3FY22 QOQ (%) FY22 FY21 YOY (%) Capital Markets (Broking, Distribution & IB) 1,436 802 79% 1,476 -3% 4,897 2,912 68% Asset Management(1) 527 691 -24% 528 - 1,829 1,602 14% Private Equity 203 72 184% 89 1
Slide 8: Reconciliation of Total PAT and TCI
EARNINGS PRESENTATION Q4FY22 Reconciliation of Total PAT and TCI PAT (₹ Mn) Q4FY22 Q4FY21 YOY (%) Q3FY22 QOQ (%) FY22 FY21 YOY (%) Operating PAT 2,623 1,865 41% 2,319 13% 8,140 5,365 52% Total Operating PAT incl. PE profit share 2,623 1,865 41% 2,319 13% 9,052 5,365 69% MTM PAT(1) 375 2,730 - 76 - 4
Slide 9: Consolidated Balance Sheet
EARNINGS PRESENTATION Q4FY22 Consolidated Balance Sheet PARTICULARS (₹ Bn) FY22 FY21 Consolidated net SOURCES OF FUNDS debt is ₹ 41.4 Bn Net Worth 56.7 44.6 Borrowings(1) 62.3 57.6 Excluding Home Minority Interest 0.3 0.3 Finance, net debt is Total Liabilities 119.3 102.6 ₹ 18 Bn Total D/E stood APP
Slide 10: Making Robust Progress
EARNINGS PRESENTATION Q4FY22 Making Robust Progress Revenue Trend Profitability Trend CAGR: 14.0 86 89 100 CAGR: 19% 29% 90 46.2 12.0 13.1 12.6 80 39.3 10.0 Revenue 70 (₹ Bn) 60 43 PAT (₹ Bn) 8.0 29.0 26.8 6.0 50 23.2 25 6.3 40 19.3 4.0 20 18 30 EPS (₹) 3.6 20 2.9 2.0 1.8 10 0.0 0 FY17 FY18 FY19 FY2
Slide 11: Demonstrating Resilience in Challenging Times
EARNINGS PRESENTATION Q4FY22 Demonstrating Resilience in Challenging Times Operating PAT Trend Growth in Equity Investments Growth: Growth: >2X >2X 2,623 2,319 40.5 PAT 36.1 37.6 1,865 1,893 (₹ Mn) 32.0 Investments 31.0 26.0 (₹ Bn) 1,246 1,230 1,303 21.3 1,037 18.6 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22
Slide 12: A Business Built to Scale
EARNINGS PRESENTATION Q4FY22 A Business Built to Scale AMC AUM Growth Trend PE/RE Commitment AUM & Fund Raise CAGR 80 74 60.0 CAGR 66 19% 70 64 65 50.0 21% 490 60 52 Fee earning 434 AMC 50 47 40.0 AUM at ₹ 100 Bn 389 AUM 356 (₹ Bn) 40 31 30.0 294 30 20.0 AUM (₹ Bn) 203 20 16.6 3.0 10.0 Fund Raised (
Slide 13: Amplifying Value for Our Stakeholders
EARNINGS PRESENTATION Q4FY22 Amplifying Value for Our Stakeholders Net Worth Trend Investment Breakup 60.0 8.0 7 Years CAGR 24% (post buyback) 56% MF + Alternates 6.8 TOTAL INVESTMENT @ 26% PE + RE ₹ 40.5 Bn 7.0 50.0 Benefits of having near to liquid Net Worth: • Helped “seed” new businesses, which
Slide 14: Operating Profit and ROE Trend
EARNINGS PRESENTATION Q4FY22 Operating Profit and ROE Trend Operating Profitability Trend Operating PAT Mix 120% Growth: Growth: Capital 4% 7% 100% 10% ~3X >2X 10% Market 9.1 25% Asset & 80% 49% 50% 40% 46% 39% Wealth Mgt Investments 60% Operating 40% Housing 5.4 PAT (₹ Bn) (₹ Bn) 4.5 40% Finance 4.
Slide 15: Capital Markets– All Round Performance (1/2)
EARNINGS PRESENTATION Q4FY22 Capital Markets– All Round Performance (1/2) • The business reported highest ever revenue and profit for FY22. 6.0% 8.8 Lakh ARPU ₹ 23.7 Bn IB Brokerage revenue growth was led by gain in cash market share Cash market share at Added 8.8 lakh new One of the highest Distrib
Slide 16: Capital Markets – All Round Performance (2/2)
EARNINGS PRESENTATION Q4FY22 Capital Markets – All Round Performance (2/2) RETAIL BROKING INSTITUTION INVESTMENT & DISTRIBUTION BROKING BANKING • Ramped up digital acquisition • Institutional team wins big • During the quarter, we by expanding dedicated digital in Asiamoney poll 2021. completed QIP
Slide 17: Broking and Distribution - Powering Our Way Forward
EARNINGS PRESENTATION Q4FY22 Broking and Distribution - Powering Our Way Forward Revenue & PAT Trend ARPU Trend *ARPU was down 30,000 6,000 Growth in PAT 30,000 13X due to base effect 4,771 Brokerage 25,000 5,000 ARPU (₹) 25,000 CAGR 53% 21,539 20,000 4,000 3,030 20,000 18,754 Overall 17,608 17,291
Slide 18: Broking and Distribution – Well Diversified Revenue Mix
EARNINGS PRESENTATION Q4FY22 Broking and Distribution – Well Diversified Revenue Mix Net Revenue Mix Gross Brokerage Mix 120% 120% 2% 5% 5% 3% Broking Cash 9% 7% 6% 100% 100% 10% 10% 9% 10% 8% 5% 8% 6% 5% 80% 4% 4% 5% 5% Interest 80% F&O 15% 22% 30% 22% Depository 39% 37% 39% Commodity 60% 60% 41% 4
Slide 19: Broking and Distribution - Strong Growth in Client Acquisition
EARNINGS PRESENTATION Q4FY22 Broking and Distribution - Strong Growth in Client Acquisition Active Clients Strong growth in Retail Client base CAGR CAGR 0.90 34% 2.85 29% Active Clients 1.97 Retail Clients 0.56 (Mn) (Mn) 1.45 0.38 1.20 0.31 0.32 1.05 0.81 0.21 FY17 FY18 FY19 FY20 FY21 FY22 FY17 FY18
Slide 20: Diversifying Customer Segment & Penetration
EARNINGS PRESENTATION Q4FY22 Broking and Distribution - Diversifying Customer Segment & Penetration Median Age of Clients Acquired Customers acquired % below 30 years of age Rising Rising 40 40 Gen Y & 49% Gen Y & 38 Gen Z Gen Z 35 30 customer 36% customer segment segment 23% 18% 15% FY18 FY19 FY20
Slide 21: Broking and Distribution - Strong Growth in Distribution AUM
EARNINGS PRESENTATION Q4FY22 Broking and Distribution - Strong Growth in Distribution AUM DP AUM Growth Trend Rising Distribution (Mass Affluent) AUM CAGR CAGR 1,958 34% 168 31% 128 DP AUM (₹ Bn) Distribution 1,184 96 90 AUM (₹ Bn) 75 607 590 44 450 468 FY17 FY18 FY19 FY20 FY21 FY22 FY17 FY18 FY19 F
Slide 22: Various Initiatives to Enhance Our Digital Journey
EARNINGS PRESENTATION Q4FY22 Broking and Distribution - Various Initiatives to Enhance Our Digital Journey RES EARCH 360 – In the process to POWERED BY MOT ILA L OWS AL launch Subscription Based Research Portal UI/UX improvement Enhancing of MO Trader App E-KYC Journey PROJECT S UPER APP In the proc
Slide 23: Asset Management
EARNINGS PRESENTATION Q4FY22 Asset Management ₹ 490 Bn ₹ 100 Bn 49% 54% ₹ 219 Cr • Highest ever profit recorded in FY22 led by strong growth in net flows and average AUM. AMC AUM stood at Passive AUM crossed Strong traction in Strong growth in SIP SIP Inflows touched ₹ 490 bn, +13% YoY ₹ 100 Bn mark
Slide 24: Asset Management – Potential Levers to Scale Business
EARNINGS PRESENTATION Q4FY22 Asset Management – Potential Levers to Scale Business MOAMC AUM Breakup and Growth trend MOMF AUM mix 120% 600 600 CAGR Direct 19% 100% 490 14% 18% 16% 14% 10% 18% NDs 434 500 500 40 389 24% 80% 400 356 27 400 ₹ Bn 29% 27% 27% 26% 22% IFA 28 142 24 294 147 MF AUM 60% 25%
Slide 25: Asset Management – Potential Levers to Scale Profitability
EARNINGS PRESENTATION Q4FY22 Asset Management – Potential Levers to Scale Profitability AMC EBITDA Margin and Opex to Alternatives Performance linked AUM share AAUM trend share in AUM in alternatives 50 40% 39% 45% 63% Mutual Fund 70% Fixed Fee 38% 38% 45 EBITDA Margin 37% 40% 33% Alternatives 30% P
Slide 26: Private Equity & Real Estate – Scaling Big
EARNINGS PRESENTATION Q4FY22 Private Equity & Real Estate – Scaling Big ₹ 100 Bn ₹ 40 Bn ₹ 12 Bn ~27% IRR +21% IRR Fee earning PE & RE IBEF IV achieved its IREF V raised ₹ 12 bn IBEF I fund has Strong performance AUM crossed ₹ 100 2nd close at ₹ 40 bn delivered an IRR of of IREF II & III funds • PE
Slide 27: PE & RE – Exits from Funds Provides Strong Visibility
EARNINGS PRESENTATION Q4FY22 PE & RE – Exits from 7 Funds provides Strong Visibility Over Next Decade Launch period of PE & RE Funds PE & RE Fund Level IRR 50.0% IBEF IV 45.0% IRR (%) 45.6% IREF V ₹ 45 Bn 40.0% Fully IREF IV ₹ 12 Bn 35.0% Exited IBEF III ₹ 11.5 Bn 30.0% IREF III ₹ 23 Bn 25.0% 26.8%
Slide 28: Wealth Management - Aiming High
EARNINGS PRESENTATION Q4FY22 Wealth Management - Aiming High ₹ 344 Bn ₹ 54 Bn 89% ~4,660 ₹ 13.5 Mn • Wealth business demonstrated strong growth in Wealth AUM Strong traction in Net Trail income covers Total families RM Productivity in at an all-time high at Sales at ₹ 54 bn in 89% of expenses; will
Slide 29: Wealth Management
EARNINGS PRESENTATION Q4FY22 Wealth Management Wealth AUM AUM Breakup CAGR: 400 400 MF 342 344 28% 350 315 350 PMS 344 300 288 37% 37% 300 253 36% AIF AUM 250 38% 250 253 (₹ Bn) 38% 200 10% 11% 200 PE/RE 9% 9% 7% 8% 8% 175 10% 8% Others 150 150 147 156 8% 16% 17% 17% 16% 17% 100 100 101 ₹ Bn 50 29%
Slide 30: Wealth Management
EARNINGS PRESENTATION Q4FY22 Wealth Management AUM Mix- Q4FY22 Revenue Mix 120% 70% 40% 60% 60% MF Transactional 10% 100% 50% PMS Recurring 46% 56% 45% 57% 53% 40% 80% 44% 40% AIF 60% 30% PE/RE 54% 60% 40% 20% Others 55% 47% 20% 44% 43% 20% 18% 10% 0% 10% 0% Recurring AUM Transactional AUM Q4FY21 Q1
Slide 31: Home Finance
EARNINGS PRESENTATION Q4FY22 Home Finance >2x Growth ECB- $50 Mn COF @7% AA (Stable) Expansion • MOHFL reported highest ever profit of ₹ 929 mn in FY22 led by robust disbursement growth of 136% YoY to ₹ 6.4 bn. Disbursements Received USD 50 mn Incremental COF in CRISIL upgraded Expanded our witnesse
Slide 32: Home Finance – Disbursement Trend
EARNINGS PRESENTATION Q4FY22 Home Finance – Disbursement Trend Disbursement Trend Conservative LTV and FOIR Growth LTV ~4X FOIR 2.1 57% 60% 59% 59% 58% 1.9 1.6 Disbursement 1.4 (₹ Bn) 44% 43% 43% 44% 43% 0.9 0.5 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 FY18 FY19 FY20 FY21 FY22 State Wise Disburseme
Slide 33: Home Finance
EARNINGS PRESENTATION Q4FY22 Home Finance ECL Provisioning Details STATE NOS. OF MOHFL’s Geographic Reach BRANCHES PARTICULARS (₹ MN) FY22 MH Maharashtra 32 PRESENCE ACROSS Stage 1 & 2 34,345 GJ Gujarat 15 104 LOCATIONS IN 12 STATES/UTS TN Tamil Nadu 14 % portfolio in stage 1 & 2 98.36% RJ Rajasthan
Slide 34: Home Finance – Strong Liability Management
EARNINGS PRESENTATION Q4FY22 Home Finance – Strong Liability Management NIM Expansion Led by Traction in CoF Liability Mix Based on Rates NIM (%) Fixed Rate Liabilities (%) Yields (%) 14.3% 14.3% 14.0% 13.9% 13.9% 50% 45% 38% 35% 33% Floating Rate Cost of Liabilities (%) fund (%) 10.3% 10.2% 10.1% 6
Slide 35: Home Finance
EARNINGS PRESENTATION Q4FY22 Home Finance Opex and Cost to Income Trend Net Worth and Net D/E 42% 41% 1,200 45% 12,000 Total 5.0 6.0 38% 36% 40% Opex (₹ Mn) cumulative 1,000 33% 10,000 4.3 5.0 capital infusion 986 1,036 35% 10,070 at ₹ 8.5 Bn 956 800 1,057 30% 8,000 8,674 9,095 4.0 858 8,266 600 25%
Slide 36: Adopting the Digital Way
EARNINGS PRESENTATION Q4FY22 Adopting the Digital Way MOBILIT Y CHANNEL PARTNERS ( M O F & M O P ) • MO Parivaar App for all stakeholders • 80% of channel partners are on-boarding • 360 Degree view of customer for employees with MO Partner Application • Download various certificate, statements and •
Slide 37: Fund Based Investments
EARNINGS PRESENTATION Q4FY22 Fund Based Investments ₹ 40.5 Bn ₹ 26.8 Bn ~₹ 17.9 Bn ~17% 26% • Fund based book includes gains/loss on sponsor Total equity Total quoted equity Total unrealised gain Cumulative XIRR on XIRR on PE/RE investment including investment as of on fund-based total quoted invest
Slide 38: Fund Based investments – Skin in The Game
EARNINGS PRESENTATION Q4FY22 Fund Based investments – Skin in The Game Skin in the Game in AMC (₹ Bn) Strong Growth in investments over the years 490 AMC AUM 40.5 20 Sponsor AUM 31.0 17.4 18 Promoter AUM 13.1 Skin in the game in PE (₹ Bn) 17.4 17.9 17.5 3.9 1.7 5.0 11.3 74 Committed 23.1 Investment
Slide 39: MOFSL - ESG Profile
EARNINGS PRESENTATION Q4FY22 MOFSL - ESG Profile ESG World Frameworks • Launched online ESG profile platform, a public, consolidated, and searchable profile on MOFSL group website, that summarizes the company’s approach towards sustainability. • Provides insightful and easily accessible information
Slide 40: MOFSL - ESG Initiatives
EARNINGS PRESENTATION Q4FY22 MOFSL - ESG Initiatives ENVIRONMENTAL SOCIAL GOVERNANCE • Usage of LED lights which • Physical & emotional wellbeing • Diverse Board Composition consume 45% less electricity assistance program • 50% Independent Director in • Emphasis on increased use of Holding Company a
Slide 41: Awards & Accolades
EARNINGS PRESENTATION Q4FY22 Awards & Accolades GREAT PLACE TO ASIA MONEY INDIA’S SMART BEST DIGITAL WORK BROKERS POLL 2021 MONEY MANAGER PRIVATE BANK - AWARDS - 2021 INDIA AWARD Motilal Oswal Financial Asia Money Brokers Motilal Oswal Wins Motilal Oswal PWM win Services Limited once Poll 2021 Best
Slide 42: Safe Harbour
EARNINGS PRESENTATION Q4FY22 Safe Harbour This earning presentation may contain certain words or phrases that are forward - looking statements. These forward-looking statements are tentative, based on current analysis and anticipation of the management of MOFSL. Actual results may vary from the forw
Slide 43: For any query, please contact
For any query, please contact : 2022 S H A L IBH ADRA S H A H CHIEF FINANCIAL OFFICER 91-22-7193 4917 / 98190 60032 shalibhadrashah@motilaloswal.com R A K E SH S H I N D E SR. VP–INVESTOR REL ATIONS 91-22-7198 5510 / 98330 44460 rakesh.shinde@motilaloswal.com
Motilal Oswal Financial Services — Q4 FY2022 Earnings Presentation on 6ix