Cholamandalam Investment And Finance Co. Ltd. · NSE:CHOLAFIN
Cholamandalam Investment And Finance — Investor Presentation (September 2019)
71 slides from Cholamandalam Investment And Finance's investor presentation, September 2019
Slide 1: Corporate Presentation - September 2019
CHOLAMANDALAM INVESTMENT AND FINANCE COMPANY LIMITED CORPORATE PRESENTATION - SEPTEMBER 2019 1
Slide 2: Table of Contents
Table of Contents 1. Group overview 2. Corporate 3. Financial 4. Business overview performance segments' overview 5. Funding profile 6. Subsidiaries 7. Risk performance management 2
Slide 3: Murugappa Group Overview
Murugappa Group Overview 3
Slide 4: Murugappa Group in a Nutshell
Murugappa Group in a Nutshell Consolidated Group Market 119 Years of $5.35 $10 Turnover cap (as on 31st Years Existence B B (FY19) Mar 2019 Listed 3 Sectors 28 Businesses 9 Companies 18 Geographical 90+ Manufacturing 50,000+ Work force Countries Presence Locations Locations 4
Slide 5: Murugappa Group Overview
Murugappa Group Overview Murugappa Group Agriculture Engineering Financial services Sector Performance—FY18-19 Market Cap(Cr.) 14,796 14,141 33,169 Turnover (Cr.) 16,442 8,165 11,654 PAT(Cr.) 799 487 1,446 Market Cap(Cr.) 11,876 2,920 5,660 7,192 24,021 NA Turnover (Cr.) 13,159 3,283 2,656 5,464 7,1
Slide 6: Corporate Overview
Corporate Overview 6
Slide 7: Spirit of Murugappa
SPIRIT OF MURUGAPPA “The fundamental principle of economic activity is that no man you transact with will lose, then you shall not." 7
Slide 8: Cholamandalam Investment & Finance Company Limited
Cholamandalam Investment & Finance Company Limited 10.5 lakh + customers 26,756 employees Helping customers enter better life Strong employees force to serve more customers 2 lakh customers in year 2000 to 10.5 lakh plus customers till date 200 plus employees in year 2000 to 26,600 employees today R
Slide 9: Our journey so far
Our journey so far Consistently profit making and dividend paying1 company since 1979 with a strong track record and dividends to shareholders FY 1979-90 FY 2000-05 FY 2011 FY 2013 FY 2015 FY 2017 FY 2019 • Commenced • Started Chola • Obtained • Total AUM • Infused capital • Total AUM • Total AUM eq
Slide 10: Shareholding
Shareholding Shareholding Pattern Top 10 Institutional Holders Corporate Bodies, 4% o Oppenheimer Mutual o HDFC Mutual Fund Funds, 18% o SBI Mutual Fund o Birla Sun Life Mutual Fund o Cartica Capital o Matthews International Public, 7% o L&T Mutual Fund o HDFC Standard Life Insurance Co Ltd Promoter
Slide 11: Business Profile and AUM as on 30th Sep 2019
Business Profile and AUM as on 30th Sep 2019 Business AUM Rs. 59,292Cr Vehicle Finance Rs. Home Equity Others 43,901Cr Rs. 12,612Cr Rs. 2,779Cr 74% 21% 5% Others 8% SME, 7% Older Tractor, 7% CE, 5% Vehicles, TW, 3% 13% Commercial 11% HCV, 15% Refinance, 13% SORP* 80% 3Whlr and LCV, 21% SCV, 6% Home
Slide 12: Strong Geographical Presence
Strong Geographical Presence 995 1025 Jammu & Kashmir (3) 885 891 907 161 180 142 110 103 Punjab (24) 267 259 226 280 Himachal Pradesh (13) 254 Chandigarh (2) 263 273 279 Uttarakhand (16) 247 265 Harayana (32) 192 201 224 257 226 Delhi (5) 50 48 58 78 60 Rajasthan (77) UP (70) Assam (24) Q2FY19 Q3FY
Slide 13: Financial Performance
Financial Performance Pee eee / / Dp ( AV uae ft FF | le i mr a ido, 0% Wied inh Va
Slide 14: Financial Snapshot - 10 Years
Financial Snapshot —10 Years FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 CAGR CAGR Financials Snapshot YoY (10 IGAAP IGAAP IGAAP IGAAP IGAAP IGAAP IGAAP IGAAP INDAS INDAS (5 years) years) Disbursem ents 3,866 5,731 8,889 12,118 13,114 12,808 16,380 18,591 25,114 30,451 21% 24% 26% Assets under
Slide 15: Chola: Financial Summary (I)
Chola: Financial Summary (I) Disbursements (₹Cr) Disbursements (%) 5% 6% 6% 7% 13% 13% 14% 13% 15,954 1,052 13,914 742 2,165 1,849 8,572 81% 81% 81% 79% 7,014 531 6,899 7,381 361 1,101 380 521 939 910 1,064 12,736 11,323 6,940 5,715 5,609 5,796 Q1FY19 Q1FY20 Q2FY19 Q2FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20
Slide 16: Chola: Financial Summary (II)
Chola: Financial Summary (II) Business - Assets under Management (₹Cr) Business - Assets under Management (%) 3% 4% 3% 5% 27% 24% 59,292 57,494 2,398 2,779 22% 23% 21% 21% 12,119 12,612 47,761 45,361 1,512 1,445 10,742 10,374 74% 75% 74% 74% 42,977 43,901 33,542 35,507 Q1FY19 Q1FY20 Q2FY19 Q2FY20 Q1
Slide 17: Chola: Financial Summary (III)
Chola: Financial Summary (III) Profit after tax (₹Cr) Networth (₹Cr) 20% *6,739 *6,486 156 156 *5,680 *5,410 621 156 156 590 1% 314 305 307 285 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 Reserves and Surplus Equity Share Capital * Total Networth Note: Consequent to c
Slide 18: Chola: Financial Summary (IV)
Chola: Financial Summary (IV) Net Income Margin (%) Expenses Ratio (%) 7.3% 7.2% 7.0% 6.7% 6.7% 6.5% 2.6% 2.6% 2.5% 2.5% 2.4% 2.5% Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 18
Slide 19: Chola: Financial Summary (V)
Chola: Financial Summary (V) Loan Losses & Provisions (%) ROTA PBT (%) 4.0% 3.9% 3.9% 3.4% 3.4% 3.3% 0.8% 0.8% 0.7% 0.7% 0.6% 0.6% Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 19
Slide 20: Chola: Financial Summary (VI)
Chola: Financial Summary (VI) Return on equity (%) Earnings per share (₹) 21.8% 21.8% 16.2 15.5 15.6 20.0% 14.6 18.5% Q1FY19 Q1FY20 Q2FY19 Q2FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 20
Slide 21: Chola: Financial Summary (VII)
Chola: Financial Summary (VII) P/E Ratio P/BV Ratio 4.4 20.7 3.6 3.4 19.7 3.2 17.7 15.1 Q1FY19 Q1FY20 Q2FY19 Q2FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 Note: Ratios have come down due to fluctuation in market price 21
Slide 22: Profit and Loss Statement (As per IND AS)
Profit and Loss Statement (As per IND AS) ₹ Cr Growth % Growth % Particulars Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q2-o-Q2 H1-o-H1 Disbursements 7,014 8,572 6,899 7,381 7% 13,914 15,954 15% Closing Assets (Managed) 46,709 62,827 52,486 64,409 23% 52,486 64,409 23% Closing Assets (Balance Sheet)
Slide 23: Balance Sheet (As per IND AS)
Balance Sheet (As per IND AS) Particulars Sep-18 Mar-19 Sep-19 ₹ Cr ASSETS Financial Assets 52,828 56,637 62,542 Cash and Bank balance 5,369 3,675 6,283 Derivative financial instruments 210 89 133 Receivables - 43 55 Loans 46,752 52,622 55,701 Investments 379 73 73 Other Financial Assets 119 135 298
Slide 24: Provision analysis: IND AS vs IGAAP
Provision analysis: IND AS vs IGAAP ₹ Cr Particulars Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 Jun-19 Sep-19 As per IGAAP GNPA 1,325 1,448 1,428 1,450 1,245 1,517 1,651 NNPA 740 812 792 790 626 808 939 Provision 585 636 636 659 620 710 712 GNPA% 3.0% 3.1% 3.0% 2.8% 2.3% 2.6% 2.7% NNPA% 1.7% 1.8% 1.6% 1.5%
Slide 25: Business Overview
Business Overview 25
Slide 26: Vehicle Finance
Vehicle Finance 26
Slide 27: Vehicle Finance: H1FY20 Performance
Vehicle Finance: H1FY20 Performance Disbursements • Disbursements has grown 12% in H1FY20 as compared to H1FY19 Assets under management Assets have grown by 23% as compared to H1FY19 Loss and Loan losses has been maintained at 0.9% as compared to 0.9% in provisions H1FY19. Profit before tax • PB
Slide 28: Auto Industry Outlook
Auto Industry Outlook Trend in Domestic LCV Sales Trend in Domestic SCV Sales (in Units) (in Units) Chola @ 19% Chola @ 5% CAGR @ 5% CAGR @ 5% 1,31,538 3,12,465 3,11,483 1,19,799 2,60,610 2,56,258 98,559 83,133 1,75,294 68,703 H1 FY-17 H1 FY-18 H1 FY-19 H1 FY-20 H1 FY-24 (E) H1 FY-17 H1 FY-18 H1 FY-
Slide 29: Auto Industry Outlook
Auto Industry Outlook Trend in Domestic HCV Sales Trend in Domestic Car & MUV Sales Chola @ -43% (in Units) (in Units) Chola @21% 1,45,728 CAGR @ 5% (42%) CAGR @ 4% 16,41,867 14,78,046 15,44,157 15,43,227 1,05,427 98,616 12,69,617 97,683 84,297 H1 FY-17 H1 FY-18 H1 FY-19 H1 FY-20 H1 FY-24 (E) H1 FY-
Slide 30: Vehicle Finance - Business Model & Positioning
Vehicle Finance—Business Model & Positioning CV PV Low Industry Low Low Industry Low Chola Position Chola Position Principal Operator Salaried > 50 Vehicles Large Operators 26- 50 vehicles HCV Self Employed with Returns Returns Financials RISK RISK Medium Operators 10 -25 – HCV & LCV vehicles Taxi a
Slide 31: Vehicle Finance - Business Model & Positioning
Vehicle Finance—Business Model & Positioning Tractor CE Low Industry Low Low Industry Low Chola Position Super Strategic Chola Position Large Farmer Strategic Customer Captive Users / Prior Vehicles Captive Users/Prior Vehicles Returns Returns Medium Retail operator RISK RISK Medium Farmers Small Re
Slide 32: Vehicle Finance - Disbursement/Portfolio Mix - H1FY20
Vehicle Finance - Disbursement/Portfolio Mix – H1FY20 Well diversified across geography & product segments Disbursements - State wise Portfolio - State wise MP AP MP AP Karnataka Karnataka Maharashtra Maharashtra Kerala Kerala 6% 5% 5% 5% 5% Pondicherry 5% Pondicherry 10% Telangana 11% 4% Telangana
Slide 33: Vehicle Finance - Disbursement/Portfolio Mix - H1FY20
Vehicle Finance - Disbursement/Portfolio Mix – H1FY20 Well diversified across geography & product segments Disbursements (₹Cr) - Product wise Portfolio (₹Cr) - Product wise CE; 4% HCV; 15% HCV; 8% CE; 5% Car and MUV; 17% Older Vehicles; Older Vehicles; 13% 16% Car and MUV; 17% Tractor 7% Tractor 7%
Slide 34: Vehicle Finance - Disbursement Mix - H1FY20
Vehicle Finance - Disbursement Mix – H1FY20 Disbursement (₹Cr) - Product wise Disbursement (%) – Product wise 7,360 6,940 8% 8% 16% 14% 14% 1,030 5% 4% 555 6,124 347 5% 5% 368 5,796 5% 5,609 17% 16% 857 Low Yield 1,180 469 15% 15% 1,104 15% 897 306 247 280 953 19% 919 21% 1,472 1,457 20% 20% 841 21%
Slide 35: Vehicle Finance - Portfolio Mix - H1FY20
Vehicle Finance - Portfolio Mix – H1FY20 Portfolio (₹Cr) - Product wise Portfolio (%) – Product wise 43,901 42,977 40,588 18% 17% 16% 15% 19% 37,476 6,725 7,039 35,507 5% 5% 7,074 4% 5% 5% 2,131 2,109 Low Yield 6,755 16% 1,983 16% 16% 16% 6,733 7,238 16% 1,724 6,995 1,545 6,498 6,006 5,656 22% 21% 9
Slide 36: Vehicle Finance: Financial summary Q2FY20 & H1FY20 (I)
Vehicle Finance: Financial summary Q2FY20 & H1FY20 (I) Disbursements (₹Cr) Assets under management (₹Cr) 24% 28% 830 42,977 43,071 12,736 35,507 11,323 33,542 21% 3% 6,940 5,715 5,609 5,796 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 On Book Assignment 36
Slide 37: Vehicle Finance: Financial summary Q2FY20 & H1FY20 (II)
Vehicle Finance: Financial summary Q2FY20 & H1FY20 (II) Income (₹Cr) Profit before tax (₹Cr) 7% 25% 637 597 3,198 2,548 -1% 16% 24% 27% 319 322 318 1,561 1,637 275 1,324 1,225 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 37
Slide 38: Vehicle Finance: Financial summary Q2FY20 & H1FY20 (III)
Vehicle Finance: Financial summary Q2FY20 & H1FY20 (III) Net Income Margin (%) Expense Ratio (%) 7.4% 7.3% 7.2% 3.1% 6.9% 6.9% 6.9% 3.0% 2.9% 2.9% 2.9% 2.9% Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 38
Slide 39: Vehicle Finance: Financial summary Q2FY20 & H1FY20 (IV)
Vehicle Finance: Financial summary Q2FY20 & H1FY20 (IV) Loan Losses & Provisions (%) ROTA PBT (%) 3.7% 3.6% 3.4% 1.0% 0.9% 0.9% 3.1% 3.0% 0.9% 0.9% 2.9% 0.8% Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 39
Slide 40: Profit and Loss Statement: Vehicle Finance (Managed)
Profit and Loss Statement: Vehicle Finance (Managed) ₹ Cr Growth % Growth % Particulars Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q2-o-Q2 H1-o-H1 Disbursements 5,715 6,940 5,609 5,796 3% 11,323 12,736 12% Closing Assets (Managed) 33,542 42,977 35,507 43,901 24% 35,507 43,901 24% Operating Income 1,2
Slide 41: Profit and Loss Statement: Vehicle Finance (On Book) (As per IND AS)
Profit and Loss Statement: Vehicle Finance (On Book) (As per IND AS) ₹ Cr Growth % Growth % Particulars Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 (YTD) Q1-o-Q1 Y-o-Y Disbursements 5,715 6,940 5,609 5,796 3% 11,323 12,736 12% Closing Assets (Balance Sheet) 33,542 42,977 35,507 43,071 21% 35,507 43,07
Slide 42: Home Equity
Home Equity 42
Slide 43: Home Equity - H1FY20 Performance
Home Equity— H1FY20 Performance Disbursements • Disbursements has grown 17% in Q1FY20 as compared to H1FY19 Asset under • The business has grown the Assets by 7% in H1FY20. management Loss and provisions • Loan losses is at 0.04% from 0.02% as compared to H1FY19 Profit before tax • PBT for H1FY20 ha
Slide 44: Home Equity: Industry outlook
Home Equity: Industry outlook • The loans against property (LAP) segment has been under pressure because of the cash flow pressure plaguing the SME segment, which is the dominant market for LAP.– Fitch Sep’19. • Growth in the value of LAP assets under management has been slowing – Moody’s Sep’19 • D
Slide 45: Home Equity - Financial Summary Q2FY20 & H1FY20 (I)
Home Equity—Financial Summary Q2FY20 & H1FY20 (I) Disbursements (₹Cr) Assets under Management (₹Cr) 17% 17% 17% 12,612 12,119 2,165 10,742 2,282 10,374 1,991 1,849 965 1,043 17% 17% 1,101 1,064 939 910 10,129 9,777 10,331 9,331 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 On
Slide 46: Home Equity - Financial Summary Q2FY20 & H1FY20 (II)
Home Equity—Financial Summary Q2FY20 & H1FY20 (II) Income (₹Cr) Profit before tax (₹Cr) 22% 722 593 22% 172 21% 22% 141 368 4% 354 301 48% 292 84 84 88 57 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Note: Without assignment gains 46
Slide 47: Home Equity - Financial Summary Q2FY20 & H1FY20 (III)
Home Equity—Financial Summary Q2FY20 & H1FY20 (III) Net Income Margin (%) Expenses Ratio (%) 1.2% 3.9% 1.1% 3.8% 3.9% 1.0% 3.8% 3.7% 3.6% 1.0% 1.0% 0.9% Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Note: Ratios are based on average AUM (Without assignment gains
Slide 48: Home Equity - Financial Summary Q2FY20 & H1FY20 (IV)
Home Equity—Financial Summary Q2FY20 & H1FY20 (IV) Loan Losses & Provisions (%) ROTA PBT (%) 3.2% 2.8% 2.8% 2.8% 2.7% 0.5% 2.2% 0.2% 0.1% 0.04% 0.02% -0.4% Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Note: Ratios are based on average AUM (Without assignment ga
Slide 49: Profit and Loss Statement: Home Equity (Managed)
Profit and Loss Statement: Home Equity (Managed) ₹ Cr Growth % Growth % Particulars Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q2-o-Q2 H1-o-H1 Disbursements 939 1,101 910 1,064 17% 1,849 2,165 17% Closing Assets (Managed) 10,374 12,119 10,742 12,612 17% 10,742 12,612 17% Operating Income 292 354 301
Slide 50: Profit and Loss Statement: Home Equity (On Book) (As per IND AS)
Profit and Loss Statement: Home Equity (On Book) ₹ Cr (As per IND AS) Growth % Growth % Particulars Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 (YTD) Q1-o-Q1 Y-o-Y Disbursements 939 1,101 910 1,064 17% 1,849 2,165 17% Closing Assets (Balance Sheet) 9,331 10,129 9,773 10,331 6% 9,773 10,331 6% Operatin
Slide 51: Funding Profile
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Slide 52: CAR, Credit Rating
CAR, Credit Rating Capital Adequacy Ratio (CAR) – As per RBI guideline Tier I Tier II 18.64 18.36 17.36 17.16 17.09 5.03 5.12 4.92 4.30 4.22 13.61 13.24 12.44 12.86 12.87 2016–2017 2017–2018 2018–2019 Q1FY20 Q2FY20 Minimum CAR Stipulated by RBI is 15% & for Tier I is 10% Credit Rating Loan type Indi
Slide 53: Diversified Borrowings Profile (I/II)
Diversified Borrowings Profile (I/II) (₹Cr) Borrowing mix by instrument type * 47,061 * 47,234 * 50,567 * 55,122 * 55,903 12% 12% 11% 10% 9% 34% 35% 43% 44% 49% 5% 4% 4% 10% 10% 1% 4% 4% 4% 5% 6% 7% 10% 4% 4% 10% 5% 26% 25% 3% 21% 17% 14% 8% 8% 8% 7% 7% Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Tier II Cap
Slide 54: Diversified Borrowings Profile (I/II)
Diversified Borrowings Profile (I/II) (₹Cr) Borrowing mix by investor type * 47,061 * 47,234 * 50,567 * 55,122 * 55,903 12% 12% 11% 10% 9% 3% 3% 2% 3% 3% 3% 5% 3% 5% 5% 4% 4% 1% 53% 50% 57% 58% 61% 1% 1% 7% 1% 1% 7% 1% 6% 5% 5% 17% 19% 13% 15% 13% 2% 3% 3% 2% 2% Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Tr
Slide 55: ALM Statement as of 30th Sep 2019 (As per IGAAP)
ALM Statement as of 30th Sep 2019 (As per IGAAP) (₹Cr) Particulars 1m >1 to 2m >2 to 3m >3 to 6m >6m to 1 yr >1 to 3 yr >3 to 5 yr >5 yr Total Cash & Bank Balances 1,661.00 2,392.17 1,556.00 - - - - - 5,609.17 Advances 1,411.13 1,186.24 1,300.04 5,355.21 9,145.42 22,979.33 5,147.97 4,428.97 50,954.3
Slide 56: Subsidiaries
Subsidiaries 56
Slide 57: Cholamandalam Home Finance Ltd (As per IND AS)
CHOLAMANDALAM HOME FINANCE LTD (As per IND AS) Income (₹Cr) Profit after tax (₹Cr) 0.4 (0.3) 0.1 (4.5) 91% (4.0) 107% 13% 7% 98% 20.31 (8.6) 18.38 10.75 9.48 8.90 9.56 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 57
Slide 58: Cholamandalam Securities Ltd (As per IND AS)
CHOLAMANDALAM SECURITIES LTD (As per IND AS) Income (₹Cr) Profit after tax (₹Cr) -9% 2.0 12.4 -48% 11.2 1.6 -71% -6% -12% 6.5 1.0 5.9 5.7 5.5 68% 0.6 0.5 0.3 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 Q1FY19 Q1FY20 Q2FY19 Q2FY20 H1FY19 H1FY20 58
Slide 59: Risk Management
Risk Management 59
Slide 60: Risk Governance Structure
Risk Governance Structure Oversee the entire risk Board of Directors management process Formed in Oct 2007,operational Risk Management from 2008 Committee Meet four times in a year Reviews framework & process, periodic monitoring of exposures Review of other initiatives with a Chief Risk O
Slide 61: ERM as value centre
ERM as value centre • ERM at Chola works as a value centre • Risk management team engages in defining framework, overseeing enterprise wide risks and building a portfolio for risk appetite based decision making. • At Chola risk management is an integral part of the existing business process and mana
Slide 62: ERM Framework
ERM Framework Measurement & Monitoring using KRI 04 01 Review mechanism to monitor & control risks Understanding & Evaluate Probability & Identification of various Impact of each event risks 03 02 HIGHLIGHTS OF THE RISK MANAGEMENT FRAMEWORK Chola Composite Risk Index, computed using multiple KRIs, h
Slide 63: ERM Framework
ERM Framework Identification, Prioritization and Monitoring of Risk and Process Indicators Identification and Measurement of Risk Assessment of Risk parameters. to Track Operational Risk Level Events & parameters Stage 1 Stage 2 Stage 3 QUALITATIVE RISK MONITORING QUANTITATIVE ASSESSMENT VALIDATION
Slide 64: Risk Monitoring: Risk Index Scoring Methodology
Risk Monitoring : Risk Index Scoring Methodology Spread of Weightages Scoring method p q r s t a n o Identified Top 20 risks are a combination of m 2.25 2 2.25 2.5 2.25 1.5 21 k l4 1 credit, market and operational risks. 3 2 j Top 6 six risks (a to f) 25% weight is given for operational risks –
Slide 65: ECL Methodology
§ Chola aXe Enier a better life ECL Methodology
Slide 66: Measurement Framework
Measurement Framework Asset ECL classification PD12m Stage 1 LGD EAD Staging Lifetime ECL Retail Stage 2 Framework Basis Account Conduct it is classified into different stages PD : Probability of default PD(100 %) LGD : Loss given default Stage 3 LGD EAD : Exposure at time of default EAD Dis
Slide 67: Measurement Framework
Measurement Framework Asset ECL Description classification PD12m • Assets with low risk (0-30 DPD) on reporting date Stage 1 LGD • Loss estimate based on a 1 year forward estimate EAD Lifetime • Assets with Significant Increase in Credit Risk (SICR) since initial recognition Stage 2 • Assets wit
Slide 68: Retail Pooling
Retail Pooling Portfolios are segmented based on the below categories. PD Chola term structure and LGDs are computed for each segment separately. Home Vehicle Finance Home Equity Others Loan MLCV/2W/3W HCV New LCV New HE Delhi HE Tamil Nadu New HE Punjab / CAR/MUV New USED SHUBH Haryana / HE Gujarat
Slide 69: Contact us
Contact us Cholamandalam Investment and Finance Company Limited (Chola), Dare House 1st Floor, No. 2, NSC Bose Road, Parrys, Our registered Chennai 600001. office Toll free number: 1800-200-4565 (9 AM to 7 PM) Land Line: 044–3000 7172 http://www.cholamandalam.com Sujatha P-Sr. Vice President & Compa
Slide 70: Disclaimer
Disclaimer • Certain statements included in this presentation may be forward looking statements made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Cholamandalam Investment and Finance Company Ltd and its subsidiaries. There can
Slide 71: Thank You
ig murugappa THANK YOU
Cholamandalam Investment and Finance Company — Investor Presentation (September 2019) on 6ix