Creditaccess Grameen Ltd. · NSE:CREDITACC
Creditaccess Grameen — Q1 FY25 Earnings Presentation
42 slides from Creditaccess Grameen's earnings presentation, Jul 19, 2024
Slide 1: Exchange filing cover letter
Ref: CAGL/EQ/2024-25/58 July 19, 2024 To BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Exchange Plaza, C-1, Block G Dalal Street Bandra Kurla Complex Bandra (East), Mumbai - 400001 Mumbai - 400051 Scrip code: 541770 Symbol: CREDITACC Dear Sir/Madam, Sub.: Investor Pr
Slide 2: CreditAccess Grameen Q1 FY25 Investor Presentation
CreditAccess Grameen Limited Q1 FY25 Investor Presentation July 2024 www.creditaccessgrameen.in
Slide 3: Disclaimer
Disclaimer By accessing this presentation, you agree to be bound by the following terms and conditions. This presentation (which may reflect some price-sensitive information in terms of SEBI regulations and Companies Act, 2013, as amended from time to time) has been prepared by CreditAccess Grameen
Slide 4: Discussion Summary
Discussion Summary Key Business Updates Financial Results Overview Liability Strategy Cross-cycle Performance Track Record Investment Rationale www.creditaccessgrameen.in 3
Slide 5: Q1 FY25: Key Business Highlights
Q1 FY25: Key Business Highlights Q1 FY25 YoY% QoQ% • Muted business momentum and transitory increase in GLP (INR Cr) 26,304 +20.6% -1.5% delinquencies due to – Borrowers (Lakh) 49.84 +12.7% +1.3% i) severe heat wave across several regions Disbursements (INR Cr) 4,476 -6.2% -44.4% ii) operational lim
Slide 6: Customer Growth Led By Robust Additions & High Retention
Customer Growth Led By Robust Additions & High Retention Robust Borrower Additions Borrower Vintage Borrowers (‘000) Q1 FY25 58% 24% 18% 115 544 Q4 FY24 57% 25% 18% 1,220 Q3 FY24 56% 27% 17% 4,423 4,984 Q2 FY24 55% 28% 17% Q1 FY24 52% 32% 16% Q1 FY24 Addition Write-off Attrition Q1 FY25 < 3 years 3-
Slide 7: Asset Quality Update (1/2)
Asset Quality Update (1/2) PAR Trend PAR 0-60 Portfolio Continues to Witness Partial Repayments 2.5% 1.8% 1.7% 1.8% Borrower Payment Stage 1 EAD Stage 2 EAD Stage 3EAD Total 1.2% 1.3% 1.2% 1.4% 1.4% Status – Jun-24 (<=15 dpd) (16–60 dpd) (>60 dpd) EAD 1.0% 0.9% 1.0% 1.2% Full Payment 97.4% 0.0% 0.0%
Slide 8: Asset Quality Update (2/2)
Asset Quality Update (2/2) Q1 FY25 (INR Cr) Consolidated Credit Cost (INR Cr) Q1 FY25 Asset Classification (dpd) EAD EAD% ECL% Opening ECL - (A) 503.4 Stage 1 0 – 15 (GL), 0 – 30 (RF) 24,895.4 97.8% 0.90% Additions (B) Stage 2 16 – 60 (GL), 31 – 90 (RF) 179.8 0.7% 56.64% - Provisions as per ECL 146.
Slide 9: Stable Net Interest Margin Profile
Stable Net Interest Margin Profile Key Metrics Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Avg. New Disbursement Interest Rate % 21.9% 22.0% 21.8% 21.4% 21.3% Portfolio Yield % 20.7% 21.1% 21.0% 21.0% 21.0% Weighted Avg. Cost of Borrowing % 9.6% 9.8% 9.8% 9.8% 9.8% Marginal Cost of Borrowing % 9.7% 9.6%
Slide 10: Performance Vs. Annual Guidance
Performance Vs. Annual Guidance FY25 Q1 FY25 Key Indicators Variance Guidance Performance • GL book grew by 18.2%, in line with internal estimates (muted business momentum due to severe heat wave across several regions, operational GLP Growth % 23.0% - 24.0% 20.6% limitations during general election
Slide 11: Discussion Summary
Discussion Summary Key Business Updates Financial Results Overview Liability Strategy Cross-cycle Performance Track Record Investment Rationale www.creditaccessgrameen.in 10
Slide 12: Q1 FY25: Key Performance Highlights
Q1 FY25: Key Performance Highlights Cost/Income NIM Ratio GLP Disbursements 13.0% PPOP 29.2% INR 26,304 Cr INR 4,476 Cr INR 709 Cr (+20.6% YoY) (-6.2% YoY) Wgtd. Avg. COB (+30.4% YoY) Opex/GLP Ratio 9.8% 4.4% ROA CRAR Total Total Equity GNPA: 1.46% PAT 5.4% 25.2% INR 6,961 Cr INR 398 Cr NNPA: 0.45%
Slide 13: Q1 FY25: P&L Statement
Q1 FY25: P&L Statement Profit & Loss Statement (INR Cr) Q1 FY25 Q1 FY24 YoY% Q4 FY24 QoQ% FY24 Interest Income 1,437.2 1,105.2 30.0% 1,363.2 5.4% 4,900.1 - Interest on Loans 1 1,411.5 1,086.2 29.9% 1,340.5 5.3% 4,812.5 - Interest on Deposits with Banks and FIs 25.6 19.0 34.7% 22.7 12.7% 87.6 Income
Slide 14: Q1 FY25: Balance Sheet
Q1 FY25: Balance Sheet Balance Sheet (INR Cr) Q1 FY25 Q1 FY24 YoY% Q4 FY24 QoQ% FY24 Cash & Other Bank Balances 887.7 1,303.3 -31.9% 1,313.9 -32.4% 1,313.9 Investments 1,206.9 731.2 65.1% 1,438.9 -16.1% 1,438.9 Loans - (Net of Impairment Loss Allowance) 24,646.9 19,820.2 24.4% 25,105.0 -1.8% 25,105.
Slide 15: Continued Business Traction with Rural Focus
Continued Business Traction with Rural Focus Gross Loan Portfolio (INR Cr) Borrowers (‘000) 20.6% 12.7% 26,714 26,304 4,984 4,918 4,603 4,693 23,382 4,423 22,488 21,814 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 www.creditaccessgrameen.in 14
Slide 16: Consistent Growth in Infrastructure
Consistent Growth in Infrastructure Branches 8.2% 1,894 1,967 1,976 1,826 1,877 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Employees Loan Officers 13.0% 11.4% 19,241 19,041 19,395 19,659 13,336 13,054 13,191 13,411 17,391 12,044 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1
Slide 17: Robust Quarterly Performance Trend (1/2)
Robust Quarterly Performance Trend (1/2) Disbursements (INR Cr) Total Income (INR Cr) -6.2% 1,459 1,513 8,053 1,248 1,295 1,171 4,771 4,966 5,344 4,476 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Margin Analysis (%) Operating Efficiency (%) 20.7% 21.1% 21.0% 21.0%
Slide 18: Robust Quarterly Performance Trend (2/2)
Robust Quarterly Performance Trend (2/2) NII, PPOP, PAT (INR Cr) Asset Quality (%) 2.29% 922 953 1.95% 1.81% 772 802 1.59% 1.60% 763 1.46% 683 709 1.18% 602 0.89% 0.97% 544 563 0.77% 1.13% 348 0.94% 347 397 398 0.70% 0.75% 353 0.60% Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4
Slide 19: Stable Operational Efficiency
Stable Operational Efficiency GLP / Branch (INR Cr) GLP / Loan Officer (INR Cr) 13.6 13.3 2.0 2.0 11.9 12.0 12.3 1.8 1.8 1.7 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Borrowers / Branch Borrowers / Loan Officer 2,422 2,453 2,478 2,500 2,522 367 360 373 372 345 Q
Slide 20: Product Range To Meet Diverse Customer Needs
Product Range To Meet Diverse Customer Needs GLP - Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Product Mix (INR Cr) % of Total (INR Cr) % of Total (INR Cr) % of Total (INR Cr) % of Total (INR Cr) % of Total IGL 20,670 95% 21,103 94% 21,800 93% 24,741 93% 24,076 92% Family Welfare 148 1% 150 1% 102 1% 82
Slide 21: Our Network & Presence
Our Network & Presence Our Presence as on Jun-24 Uttar Pradesh 98 Branch Network Q1 FY25 % Share Q1 FY24 % Share 16 States & 1 UT Karnataka 343 17.4% 319 17.5% 388 Districts Bihar 1,976 Branches Maharashtra 300 15.2% 306 16.8% 158 Tamil Nadu 387 19.6% 383 21.0% West Bengal Madhya Pradesh 151 7.6% 14
Slide 22: Discussion Summary
Discussion Summary Key Business Updates Financial Results Overview Liability Strategy Cross-cycle Performance Track Record Investment Rationale www.creditaccessgrameen.in 21
Slide 23: Progressing Well on Liability Strategy
Progressing Well on Liability Strategy Diversified Liability Mix - Institution / Instrument Wise (%) Focus on dynamic liability management NBFCs - TL FIs - TL • Focus on long-term funding with strong diversification between domestic 2.7% 10.5% & foreign sources Banks - TL • Target to meet funding re
Slide 24: Stable Liquidity/ ALM Position/ Credit Ratings / ESG Ratings
Stable Liquidity/ ALM Position/ Credit Ratings / ESG Ratings Static Liquidity / ALM Position For the Month For the Financial Year Debt Diversification Q1 FY25 FY25 Particulars (INR Cr) Jul-24 Aug-24 Sep-24 FY26 Total Drawdowns 1,099 (Jul-24 - Mar-25) Opening Cash & Equivalents (A) 2,001.5 2,460.8 3,
Slide 25: Discussion Summary
Discussion Summary Key Business Updates Financial Results Overview Liability Strategy Cross-cycle Performance Track Record Investment Rationale www.creditaccessgrameen.in 24
Slide 26: Past Five Years Performance Track Record (1/2)
Past Five Years Performance Track Record (1/2) Gross Loan Portfolio (GLP) (INR Cr) Disbursements (INR Cr) Borrowers (‘000) CAGR CAGR CAGR 5% 22% 22% 23,134 4,910 26,714 18,539 4,055 4,264 21,031 3,912 3,824 15,466 16,599 11,996 13,587 10,389 11,011 FY20 FY21 FY22 FY23 FY24 FY20 FY21 FY22 FY23 FY24 F
Slide 27: Past Five Years Performance Track Record (2/2)
Past Five Years Performance Track Record (2/2) Note: Refer Annexure for definition of key ratios Margin Analysis (%) Operating Efficiency (%) Asset Quality (%) 20.9% 5.01% 19.4% 18.8% 18.3% 18.9% 4.9% 4.8% 4.9% 4.7% 4.5% 3.44% 2.78% 13.0% 1.78% 1.95% 12.2% 10.9% 11.6% 4.43% 10.7% 36.7% 38.1% 39.0% 3
Slide 28: Past Eight Years Cross Cycle Performance
Past Eight Years Cross Cycle Performance Cross-Cycle ROA (%) Cross-Cycle ROE (%) Strong Cross Cycle FY19 FY21 FY22 FY17-FY18 Performance Despite Floods, Covid Covid Demonetisation Several Crisis NBFC crisis Wave 1 Wave 2 5.6% 5.1% 5.0% 24.9% 22.2% 4.2% 3.6% Avg: 3.6% 18.0% 16.3% Avg: 15.0% 12.3% 12.
Slide 29: Discussion Summary
Discussion Summary Key Business Updates Financial Results Overview Liability Strategy Cross-cycle Performance Track Record Investment Rationale www.creditaccessgrameen.in 28
Slide 30: Measuring the Impact Created by CA Grameen (1/2)
Measuring the Impact Created by CA Grameen (1/2) The third-party study was performed on a probability sample of 3,189 women customers across 13 states, who were interviewed using a structured questionnaire. The study findings reinforce the significance of CA Grameen in the economic upliftment of the
Slide 31: Measuring the Impact Created by CA Grameen (2/2)
Measuring the Impact Created by CA Grameen (2/2) Quality of Life • 86% can spend more on education (47% spending • Economic 80% Impact aspired to buy a new house / renovate an existing house >INR 2,000 per month) using credit from CA Grameen over the next 2-3 years - Strong '+ve' correlation between
Slide 32: Highly Motivated Team, Strong Management Foresight & Execution Strength
Highly Motivated Team, Strong Management Foresight & Execution Strength Management Team with Decades of Experience across Banking and Finance Industries Udaya Kumar Hebbar Ganesh Narayanan Balakrishna Kamath Managing Director Chief Executive Officer Chief Financial Officer Sudesh Puthran Firoz Anam
Slide 33: Committed to Basics Through Classical JLG Lending Model
Committed to Basics Through Classical JLG Lending Model Microfinance loans are unsecured. JLG mechanism acts as security/ loan collateral Fully aligned with new harmonized guidelines in terms of - JLG Benefits: ✓ Formulation of Board approved policies ✓ Strong group bonding ✓ Process modifications ✓
Slide 34: Focus on Customer Centricity, Loyalty & Retention
Focus on Customer Centricity, Loyalty & Retention “One of the Lowest Cost Organised Financer” - One Stop Shop providing Support to Various Lifecycle Needs of the Customer One of the lowest lending rates in MFI industry Loan Customer Centric Ticket Size Tenure Purpose Type Products (INR) (months) Div
Slide 35: Calibrated Expansion Through Contiguous District-Based Approach
Calibrated Expansion Through Contiguous District-Based Approach Systematic geography selection based on the availability of infrastructure, competition, historical performance trend, social/ economic/ political/ climate risk, growth potential Ensures consistent replication of processes/ controls Fam
Slide 36: Unique Human Capital, Internal Audit & Risk Management
Unique Human Capital, Internal Audit & Risk Management Well-Established Operational Structure Multi-Pronged Approach For Risk Management Sound Understanding of Rural Market Internal Audit (IA): Business Heads • IA frequency – 8 times in a year at branches, 4 times at RO, 4 times at • ~90% of employe
Slide 37: Strong Internal Control Structure: Three Lines Of Defence
Strong Internal Control Structure: Three Lines Of Defence 3rd line of defence: Internal Audit team 2nd line of defence: Risk team 1st line of defence: Field & Quality Control teams Zonal Manager / State Head Zonal Manager handles 100 – 120 branches Regional / Divisional Regional Manager handles 40-5
Slide 38: Continuous Technology Enhancement to Drive Operational Efficiency
Continuous Technology Enhancement to Drive Operational Efficiency Ensures Quick And Seamless Delivery of Need Based Financial Products and Services backed by Robust Technology Infrastructure High touch-high tech delivery model: Future Upgrades & Investments • Digitised all customer touchpoints • Inv
Slide 39: Integrating Risk Management in Every Operating Process
Integrating Risk Management in Every Operating Process Microfinance is a Collection Business, hence Risk Management is Integral to Core Strategy and Operating Processes Contiguous Customer Employee Target Customer Customer Lending Employee District-based Engagement Incentive Segment Due-Diligence Mo
Slide 40: Strong Parentage & Shareholder Base
Strong Parentage & Shareholder Base Shareholding Pattern – June 2024 Others, MF, AIF, 6.31 Insurance, 16.25 Promoter Group, 66.56 FPI, 10.88 Committed to Strong Financial Support Micro Finance Business via Patient Capital • CreditAccess India B.V. (CAI) • Invested through multiple rounds of speciali
Slide 41: Key Ratios: Definitions
Key Ratios: Definitions 1. Portfolio Yield = (Interest on loans – processing fees + Income from securitisation)/ Avg. quarterly on-book loans 2. Weighted Avg. COB = (Borrowing cost – finance lease charges) / Daily average borrowings (excl. Financial Liability towards Portfolio Securitized) 3. Margin
Slide 42: Thank You!
For Further Queries: Nilesh Dalvi SVP & Head - Investor Relations Contact No - 9819289131 Thank You! Email Id - nilesh.dalvi@cagrameen.in Sahib Sharma DGM - Investor Relations Contact No - 7066559383 Email Id - sahib.sharma@cagrameen.in 41 41 www.creditaccessgrameen.in