Motilal Oswal Financial Services Limited · NSE:MOTILALOFS
Motilal Oswal Financial Services — Q4 FY24 Earnings Presentation
43 slides from Motilal Oswal Financial Services's earnings presentation, Apr 26, 2024
Slide 1: Cover letter to stock exchanges
April 26, 2024 To 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 – Finan
Slide 2: Investor Presentation Q4FY24 & FY24
MOTILAL OSWAL INVESTOR PRESENTATION Q4FY24 & FY24
Slide 3: Strong Quarterly Operating PAT trend
Strong Quarterly Operating PAT trend Segmental PAT (₹ Cr) Q4FY24 Q3FY24 Q2FY24 Q1FY24 Capital Market 251 205 181 165 YoY Growth % 66% 42% 27% 50% Asset & Wealth Management 210 145 131 121 YoY Growth % 79% 20% 13% 24% Housing Finance 31 36 33 29 YoY Growth % 0% 0% -2% -11% Operating PAT* 495 380 353
Slide 4: Operating PAT grew by 24% CAGR in last 5 years
Operating PAT grew by 24% CAGR in last 5 years Segmental PAT (₹ Cr) FY24 FY23 FY22 FY21 FY20 5 year CAGR Capital Market 803 547 520 323 219 33% YoY Growth % 47% 5% 61% 47% 13% Asset & Wealth Management 607 452 443 320 249 19% YoY Growth % 34% 2% 38% 29% -3% Housing Finance 129 133 93 40 39 18% YoY G
Slide 5: Consistent Operating RoE of ~20%+ in last 5 years
Consistent Operating RoE of ~20%+ in last 5 years RoE (%) FY24 FY23 FY22 FY21 FY20 Capital Market 25% 21% 25% 19% 17% Asset & Wealth Management 35% 32% 43% 46% 47% Housing Finance 11% 13% 10% 5% 5% Operating RoE 25% 22% 27% 20% 19% Treasury Investments (XIRR)* 18% 16% 20% 21% 14% Consolidated RoE 35
Slide 6: Double Engine Model – Operating Business + Active Investments Book
Double Engine Model – Operating Business + Active Investments Book Investments are used strategically Engine #1 Engine #2 for operating businesses OPERATING BUSINESSES TREASURY INVESTMENTS • Asset light businesses Synergy • Skin in the game + • Diversified revenue streams • Highly liquid Liquidity •
Slide 7: Future is as exciting as past
Future is as exciting as past Engine #1 Operating PAT grew 34% Total Operating PAT Expect to grow at 15-20% CAGR CAGR in last decade Treasury Investments Engine #2 Book grew 44% CAGR in Maintain / improve existing IRR of 18% Treasury Investments last decade 20% of Operating PAT in Continue to mainta
Slide 8: Financial Performance Q4FY24 & FY24
Financial Performance Q4FY24 & FY24 7
Slide 9: Key Highlights for Q4FY24 – Declared 3 bonus shares for 1 equity share
Key Highlights for Q4FY24 – Declared 3 bonus shares for 1 equity share Assets under advice Revenue Operating PAT Total PAT (incl. OCI) Net Worth ₹ 3.8 lakh cr 24% YoY ₹ 1,569 cr 60% YoY ₹ 495 cr 66% YoY ₹ 625 cr 448% YoY ₹ 8,732 bn 40% YoY Lending Book 1 ROE Nos. Of Franchisee Clients Employees ₹ 11
Slide 10: PBT margin consistently at ~50% across quarters
PBT margin consistently at ~50% across quarters Revenue (₹ Cr) Operating PAT (₹ Cr) 495 1,569 380 1,213 1,220 353 1,075 298 307 981 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 PBT Margin (%) Net Worth (₹ Cr) 55% 8,732 54% 8,267 7,465 6,932 51% 6,252 50% 48% 9 Q4FY23 Q1FY24
Slide 11: Consolidated P&L – YoY growth of 38% for FY24 & 66% for Q4FY24
Consolidated P&L – YoY growth of 38% for FY24 & 66% for Q4FY24 PARTICULARS (₹ Cr) Q4FY24 Q4FY23 YoY (%) Q3FY24 QoQ (%) FY24 FY23 YoY (%) Capital Markets (Broking, Distribution & IB) 982 586 68% 770 28% 3,235 2,357 37% Asset and Wealth Management 589 372 58% 429 37% 1,774 1,359 31% Housing Finance 78
Slide 12: 23% CAGR Net Worth growth in last 5 years after payout
23% CAGR Net Worth growth in last 5 years after payout Mar 31, Mar 31, Particulars (₹ Cr) 2024 2023 SOURCES OF FUNDS Net Worth 8,732 6,252 FY24 Particulars (₹ Cr) Borrowings 13,752 10,310 Capital Asset & HFC Treasury Total Market WM Minority Interest 37 31 Total Liabilities 22,521 16,593 Net Worth 3
Slide 13: Capital Market
Capital Market #3 – Overall industry* #1 – Full service broker* *by FY23 gross brokerage revenue 12
Slide 14: Market drawdown ≠ volume slow down
Market drawdown ≠ 𝐯𝐨𝐥𝐮𝐦𝐞 𝐬𝐥𝐨𝐰 𝐝𝐨𝐰𝐧 %Change NSE Total Trades (#of % ChangeIn Incremental NIFTYMIDCAP CashTrades+F&O NSE Total Demat Year NIFTY50 Contracts) (Bn) 150 Trades Accounts (Mn) FY07 12% -2% 1.0 31% 1.2 FY08 24% 20% 1.6 60% 3.9 FY09 -36% -49% 2.0 27% 1.0 Added 3.7 cr new demat…
Slide 15: Leading full service broker – 3x distribution expansion to drive penetration
Leading full service broker – 3x distribution expansion to drive penetration 07. Investment Banking Services: 01. Advisory Capabilities: • Strong growth seen in our Investment Digital capability with 2,500+ advisors to provide unique banking business value proposition to clients • New Leadership tea
Slide 16: Market share gains without compromising ARPU
Market share gains without compromising ARPU Extensive Geographical Reach Robust DP AUM growth (₹ Lakh cr) ADTO continue to rise (₹ Lakh cr) 5.55 PRESENCE ACROSS 2,500 BUSINESS 2.47 LOCATIONS IN 0.88 0.47 1.18 1.96 1.94 2.26 550 CITIES 0.23 0.44 Mar-20 Mar-21 Mar-22 Mar-23 Mar-24 FY20 FY21 FY22 FY23
Slide 17: Highest ever quarterly and yearly Capital Market profit
Highest ever quarterly and yearly Capital Market profit PARTICULARS (₹ Cr) Q4FY24 Q4FY23 YoY (%) Q3FY24 QoQ (%) FY24 FY23 YoY (%) Revenues 982 586 68% 770 28% 3,235 2,356 37% Brokerage 611 362 69% 472 29% 1,995 1,487 34% Distribution 88 48 82% 49 80% 214 168 28% Net Interest Income 200 120 67% 169 1
Slide 18: Asset and Wealth Management
Asset and Wealth Management Equity Power House 17
Slide 19: Integrated Wealth Platform with huge runway for growth
Integrated Wealth Platform with huge runway for growth ❖ Proven track record of 21 years ASSET ❖ Only Equity oriented fund house with focus on Active Equity (Mutual fund, PMS and MANAGEMENT AIF) ❖ 82% of the strategies have outperformed the benchmark as on 31st March 2024 MANUFACTURING CAPABILITIES
Slide 20: Capitalisation of the growing investible wealth in India
Capitalisation of the growing investible wealth in India UHNI (NW Above 25 crs) Wealth Management HNI & Affluent Our Focus Area (NW From 5cr to 25 crs) Private Client Group Retail (NW* 1- 5 cr) *Net Worth (NW) 19 KEY HIGHLIGHTS FINANCIALS BUSINESSES
Slide 21: Strategic RM hiring, focus on improving productivity & margins
Strategic RM hiring, focus on improving productivity & margins Strong growth in WM & PCG AUM (₹ Cr) Continued traction in RM addition Family 12, 000 650 RM 1,23,989 11, 500 1,11,565 584 600 11, 000 93,442 550 84,143 10, 500 72,133 10, 000 500 474 9,5 00 458 450 9,0 00 420 407 400 8,5 00 9,164 9,716
Slide 22: Turnaround in AMC fund performance yielding the result now
Turnaround in AMC fund performance yielding the result now Performance for past one year FY23 FY24 Total No. of Strategies (MF + PMS + AIF) 10 SIP Market Share 1.0% 1.5% No. of strategies outperformed benchmark 9 MF Gross Sales Market Share 0.7% 1.6% Mutual Fund 5 MF Net Sales Market Share (0.3)% 1.
Slide 23: Sticky monthly realized SIP flow grew 2x to Rs. 336 Cr in Mar 24
Sticky monthly realized SIP flow grew 2x to Rs. 336 Cr in Mar 24 Strong growth in AMC AUM (₹ Bn) Robust growth in AMC Gross Sales (₹ Cr) 6,122 5,038 4,052 2,216 45,712 51,417 55,252 64,857 71,810 Mar-23 Jun-23 Sep-23 Dec-23 Mar-24 Q1FY24 Q2FY24 Q3FY24 Q4FY24 AMC MF SIP flows AMC MF Folios (in Lakh)
Slide 24: Strong performance across Private Equity & Real Estate Funds
Strong performance across Private Equity & Real Estate Funds Successful launch of PE & RE Funds over years Expected exit in near IREF VI future IBEF IV ₹ 2,000 Cr FY26 FY26 Fully Exited in FY22 IREF IV IREF V ₹ 1,200 Cr ₹ 4,500 Cr Plan to launch 5th IBEF III ₹1,150 Cr Private Equity IREF III ₹2,300
Slide 25: Focus on building recurring revenue
Focus on building recurring revenue… ARR AUM (₹ Cr) Mar’24 Dec’23 Mar’23 ARR AUM Net Yield Q4FY24 Q4FY23 Q3FY24 FY24 FY23 AMC & PE/RE 81,858 74,242 55,898 AMC & PE/RE 0.9% 0.9% 0.9% 0.9% 0.9% Wealth Management 21,387 18,763 15,368 Wealth Management 2.6% 1.9% 2.2% 2.3% 2.1% Total Asset and Wealth Tot
Slide 26: Asset and Wealth Management – 34% YoY growth in FY24
Asset and Wealth Management – 34% YoY growth in FY24 PARTICULARS (₹ Cr) Q4FY24 Q4FY23 YoY (%) Q3FY24 QoQ (%) FY24 FY23 YoY (%) Total Revenues 589 372 58% 429 37% 1,774 1,359 31% Fees & Commission^ 399 250 60% 272 47% 1,146 917 25% Net Interest Income 83 57 44% 72 15% 277 200 39% Transactional Income
Slide 27: Housing Finance
Housing Finance Building blocks in place 26 KEY HIGHLIGHTS FINANCIALS BUSINESSES
Slide 28: Geared for strong growth, led by 2x RM scale up in FY25
Geared for strong growth, led by 2x RM scale up in FY25 Growing Disbursements (₹ Cr) Way Forward 480 247 197 • Sales force doubled in FY24. Plan to double it again in 93 FY25 • Strong disbursement exit during the quarter. Target to Q1FY24 Q2FY24 Q3FY24 Q4FY24 double disbursement figures next year. S
Slide 29: Leveraging strong brand and capital adequacy for growth
Leveraging strong brand and capital adequacy for growth Wide Geographic Reach Key Ratios PRESENCE ACROSS 111 LOCATIONS IN 12 STATES/UTS Parameters FY24 FY23 HR DL RJ UP Yield 14.2% 13.9% GJ MP CG COF 8.3% 8.0% 148 Branch Sales Manager servicing the MH TS Spread 5.9% 5.9% above locations KA AP NIM 7.
Slide 30: New leadership team aiming for doubling disbursements in FY25
New leadership team aiming for doubling disbursements in FY25 PARTICULARS (₹ Cr) Q4FY24 Q4FY23 YoY (%) Q3FY24 QoQ (%) FY24 FY23 YoY (%) AUM 4,074 3,835 6% 3,781 8% 4,047 3,835 6% Disbursement 480 361 33% 247 94% 1,018 1,006 1% Net Interest Income (NII) 78 75 4% 80 -2% 312 296 5% Operating Expenses 4
Slide 31: Treasury Investments
Treasury Investments Strong collateral support for businesses 30
Slide 32: Treasury Investments – 18.3% XIRR over the last 11 years
Treasury Investments – 18.3% XIRR over the last 11 years Skin in the Game (₹ Cr) Strong Growth in investments over the years Total AMC & PE/RE XIRR – 18.3% 6,113 85,410 AUM & Commitment 4,312 Sponsor 4,326 4,094 2,645 Promoter 3,125 3,076 1,665 1,761 • Treasury Investment- • gives the company liquid
Slide 33: Treasury Investments - earned 34% return in FY24
Treasury Investments - earned 34% return in FY24 PARTICULARS (₹ Cr) Q4FY24 Q4FY23 Q3FY24 FY24 FY23 Revenues 406 -48 414 1,451 139 -MF/Alternates 255 -91 329 1,088 76 -PE/RE 54 20 70 220 61 -Unlisted Shares/Others 97 24 15 143 2 Expenses 138 101 113 467 382 PAT 228 -134 280 906 -182 OCI -98 -51 113 1
Slide 34: Highly professionalised structure
Highly professionalised structure RAAMDEO AGRAWAL MOTILAL OSWAL NAVIN AGARWAL AJAY MENON PRATEEK AGARWAL RAJAT RAJGARHIA AMIT RAMCHANDANI CHAIRMAN MD & CEO Group MD - MOFSL CEO – RETAIL BROKING MD& CEO – ASSET CEO – INSTITUTIONAL CEO – INVESTMENT AND DISTRIBUTION MANAGEMENT EQUITIES BANKING • Charte
Slide 35: MOFSL - ESG Initiatives
MOFSL - ESG Initiatives Launched online ESG profile platform, CRISIL has assigned “ADEQUATE” rating to which adheres to international frameworks such as MOFSL in its Sustainability Yearbook 2022 IFC, GRI, SASB, CDP etc. ENVIRONMENTAL SOCIAL GOVERNANCE • More than 80% of servers are in • Physical & e
Slide 36: Motilal Oswal - The Bigger Picture
Motilal Oswal - The Bigger Picture 35
Slide 37: Amrit Kaal to reach new heights
36 FY97 0.1 FY15 2.0 0.1 FY16 2.1 FY99 0.1 0.1 FY17 2.3 FY01 0.1 KEY HIGHLIGHTS FY18 2.7 0.1 FY03 0.1 FY19 2.7 0.2 FINANCIALS FY20 2.8 Source: As per internal estimate FY05 0.2 0.3 FY21 2.7 FY07 0.3 FY22 3.2 BUSINESSES 0.5 FY09 0.4 FY23 3.4 0.5 FY11 0.6 FY24 3.7 0.6 $ 13 lakh crore FY13 0.6 FY25 4.1
Slide 38: Robust Industry Trend
Robust Industry Trend Demat Account grown at 20% CAGR in last 10 years SIP flows on a relentless rise, making the markets (in Cr.) resilient – grown at 24% CAGR in last 7 years % of Household Assets in Equities 0.5 Monthly addition 16 Mar-2024 ₹ 19,271cr Total (RHS) 14 4.8 4.7 0.4 12 4.3 Mar-2020 0.
Slide 39: 37-year strong brand
37-year strong brand MOFSL awarded ‘Brand of the Year’ at the CNBC TV18 - India Business Leadership Awards 2018 MOFSL was featured in ‘Fortune 500 (India)’ in 2017, 2019, 2020, 2021, and 2022 MOFSL gets featured in ‘Forbes Super 50 Companies’ 2017 & 2018 MOFSL gets listed in ‘Fortune 500 India’s Lar
Slide 40: Robust business network & infrastructure
Robust business network & infrastructure R O B U Distribution Network Geographical Reach S 8,010+ Franchisee 2,500+ Business Location T 20,000+ IFAs 98% of PIN codes covered Motilal Oswal Tower - Mumbai I N F R Clients A 70,00,000+ S Motilal Oswal Tower - Ahmedabad T R U C Employees Advisors & Resea
Slide 41: Group Structure
Group Structure MOFSL Group Capital Markets Asset and Wealth Management Housing Finance Asset Private Broking & Institutional Investment Wealth Management Equity & Distribution Equities Banking Management Company Real Estate Motilal Oswal Motilal Oswal Motilal Oswal Asset Motilal Oswal Motilal Oswal
Slide 42: Safe Harbour
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 forward-looking statements contai
Slide 43: Contact
MOTILAL OSWAL For any query, please contact SHALIBHADRA SHAH CHETAN PARMAR Chief Financial Officer HEAD INVESTOR RELATIONS 91-22-7193 4917 / 98190 60032 91-22-7190 6600 / 74003 12700 shalibhadrashah@motilaloswal.com chetan.parmar@motilaloswal.com
Motilal Oswal Financial Services — Q4 FY24 Earnings Presentation on 6ix