Intellect Design Arena Ltd · NSE:INTELLECT
Intellect Design Arena — Investor Day (July 2018)
46 slides from Intellect Design Arena's investor day presentation, Jul 31, 2018
Slide 1: Driving Digital Leadership
DRIVING DIGITAL LEADERSHIP GLOBAL FINTECH PRODUCT COMPANY Text Investor and Analyst Summit July 31, 2018 0
Slide 2: Safe Harbor Statement
Safe Harbor Statement Certain statements in this release concerning our future prospects are forward-looking statements. Forward- looking statements by their nature involve a number of risks and uncertainties that could cause actual results to differ materially from market expectations. These risks
Slide 3: What Is Our Market?
WHAT IS OUR MARKET? We address the Our view of global technology the market requirements of • Banks • We look at market as ‘three worlds’ - • Financial Institutions – World 1, World 2 and World 3 Central Banks, Non • World 1 Market : Advanced Market Banking Financial Houses, which started their tech
Slide 4: Market Size
MARKET SIZE Technology spend in FinTech - $300 Bn 50% growth in product business i.e. $20 Bn to $30 Bn between FY18 to FY23 Tailwinds for ‘Buy’ replaces ‘Build’ - Moving from 7% to 10% Market size is not a constraint 3
Slide 5: Growth Drivers That Accelerate Demand
GROWTH DRIVERS THAT ACCELERATE 3 DEMAND Ecosystem 2 evolution • ‘Wired Economy’ • Disaggregation / Disintermediation 1 Deadlines for Regulatory Compliance • Basel recommendations – Capital adequacy Digital renovation is • Fast Payments initiative no more a choice • Open Banking standards • Pressure
Slide 6: World #1
WORLD #1 • Fragmented and high cost legacy technologies drive need for modernisation. • Need to accelerate change, market and regulatory pressures – push them to ‘Buy’ against the traditional ‘Build’ approach. • Very High Technology Costs - Per account cost exceed $100 p.a. • Need for reliable vendo
Slide 7: World #2
WORLD #2 • Banks in this space add non fund business to pure fund based income. • These banks looks for advanced solutions in Trade Finance, Supply Chain Finance, Treasury, Custody, Lending, Credit card, Payments and Collections • Several of these solutions are sought in ‘Wave 2’ viz., after the cor
Slide 8: World #3
WORLD #3 • These banks look for Core banking and lending platforms largely to support retail banking vertical • Another category of banks are the Challenger banks seeking to position themselves as ‘Digital Banks’ • Our typical margin is 40% - 45% East & West Africa, Levant, Cambodia, Bhutan • Indust
Slide 9: Insurance
INSURANCE • Our focus is on World 1 and World 2 markets - USA, UK and India • Artificial Intelligence and Machine Learning are redefining the ‘rule based’ algorithms that drive business in this space • Industry Players: Ipipeline and Guidewire • Intellect SEEC business competes in this space 8
Slide 10: Intellect Product Story
INTELLECT PRODUCT STORY 9
Slide 11: What Is Product Story
WHAT IS PRODUCT STORY 5 steps to drive sustainable It takes 3 years to move and scalable Product from Step 2 to step 4. Business • Step#1 : Building a product around an identified market need Over 60% of our product investments • Step#2 : Winning first reference deliver to this time frame • Step#3 :
Slide 12: Our Portfolio of Products
OUR PORTFOLIO OF PRODUCTS Intellect Digital Intellect Digital Intellect Digital 1 Core – IDC 17.1 2 Lending 3 Credit card Intellect Quantum Contextual Banking 4 Central Banking Solution 5 Experience (CBX) 6 Contextual Payments Trade and Supply Digital Transaction 7 Liquidity 8 Chain Finance 9 Bankin
Slide 13: Intellect 1.0 – 2015-2018
INTELLECT 1.0 – 2015-2018 Phase of growth and investment – Several Products were in Steps # 2 and # 3 – Investments in Product development – Investments in Sales & Marketing – Brand building, gaining Market acceptance, winning Analyst endorsements – Investments in building Leadership bandwidth and b
Slide 14: Intellect 2.0 – 2018-2021
INTELLECT 2.0 – 2018-2021 – Industrialization – Monetization 13
Slide 15: Four Elements: Moat, Growth, Margins, Cash
Four Elements Growth Moat Assurance Margins Cash 14
Slide 16: Moat
Four Elements Moat Growth Assurance Margins Cash 15
Slide 17: Moat – The Golden Quad
4 ELEMENTS OF Moat MOAT – THE GOLDEN QUAD Brand & End Leadership Sales Customer Product 16
Slide 18: Moat: Brand & Sales
Moat BRAND & SALES 17
Slide 19: Principles of Brand Building – Creating Desire
Moat PRINCIPLES OF BRAND BUILDING – CREATING DESIRE Leverage Thought leadership Participation in big Industry experts branding: Set up iGTB industry event like Andrew England, Oxford School of SIBOS, LOMA, Women Banesh Prabhu, Transaction Banking in Payments Anand Pande, Swarup Chaudhury B1 B2 B3 B4
Slide 20: IBS Annual Sales League Table 2018
Moat IBS ANNUAL SALES LEAGUE TABLE 2018 Ranked Ranked Ranked Ranked #1 #2 #3 #4 Retail Banking Lending Systems Digital Banking & Investment Fund Systems Intellect Digital Channels Management System Intellect Digital Core Lending Intellect Digital Intellect Banking Experience OneMarkets Payment Syste
Slide 21: iGTB Moat
iGTB Moat # 1 Partner of Choice for Digital Transaction Banking Transformation Programs 20
Slide 22: International Recognition
Moat INTERNATIONAL RECOGNITION Recognized as a iGCB powered Majid Celent rates iGTB Aite features Intellect Leader in Magic Al Futtaim Finance amongst leading SEEC amongst leading vendors US & Europe vendors Quadrant for Global wins Celent's Model Retail Core Banking Bank" Award Celent positions iGT
Slide 23: Moat: End Customer
Moat END CUSTOMER 22
Slide 24: Intellect Customer Landscape – World #1
US : Citibank, JPMC, Fifth Third, All state, St. James Moat Place Canada : Bank of UK : Barclays, Lloyds, Montreal, OMA HSBC, INTELLECT CUSTOMER Australia : ANZ, Westpac LANDSCAPE - Europe : Santander, WORLD #1 Deutsch Leasing, Raiffeisen, SEB, Riksbank, Cater Allen, Central Bank of Armenia Japan: S
Slide 25: Intellect Customer Landscape – World #2
Africa : Nova Bank, Exim Bank, HFB, National Bank of Moat Ethiopia, Nedbank, CB Seychelles Philippines: DBP, Middle East: FAB / NBAD, BDO, PNB, Arab Bank, Ahli Bank, Dubai ChinaBank, RCBC Islamic, ADIB, UNB, INTELLECT QNB, SAMBA CUSTOMER India : RBI, GeM, LIC, LANDSCAPE - Vietnam: Techcom, AMFI, NAB
Slide 26: Moat: Leadership
Moat LEADERSHIP 25
Slide 27: Moat: Leadership
Moat LEADERSHIP • Designing the Business by the Best-in-Class people • Stable Leadership Team. High retention • 100 + leaders from Financial and Technology world of each with around 25 years of experience • Diversity and Inclusiveness. Nationality Agnostic. 26
Slide 28: Moat: Product
Moat PRODUCT 27
Slide 29: What Makes Intellect Product Superior
Moat WHAT MAKES INTELLECT PRODUCT SUPERIOR 1. Design Thinking 2. Unified architecture across technologies for complete financial world. 3. Organically built – against acquired pieces being pieced together by Competition. 4. Very high technology performance 5. Complete Digital 360 Architecture – Digi
Slide 30: Growth Assurance
Four Elements Growth Moat Assurance Margins Cash 29
Slide 31: Consistent Growth: Calibrated Growth Yielding Predictability
Growth CONSISTENT GROWTH Assurance Calibrated Growth Yielding Predictability Revenue (in INR) License Revenue AMC Revenue 1087 208.8 914 198.8 811 170 156 144 608 126 109 86 FY 15 FY 16 FY 17 FY 18 FY 15 FY 16 FY 17 FY 18 FY 15 FY 16 FY 17 FY 18 30
Slide 32: Revenue Growth in the Last Quarters
Growth REVENUE GROWTH IN THE LAST 15 QUARTERS Assurance Calibrated Growth Yielding Predictability 1145 1087 1100 1031 986 1000 949 914 874 900 847 824 811 800 755 721 700 640 608 600 577 500 Since Listing Q3 15 Q4 15 Q1 16 Q2 16 Q3 16 Q4 16 Q1 17 Q2 17 Q3 17 Q4 17 Q1 18 Q2 18 Q3 18 Q4 18 Q1 19 LTM =
Slide 33: Healthy Pipeline
Growth HEALTHY PIPELINE Assurance The current funnel (Active Pursuits) of Intellect is around $ 527 mn (3500 Cr), out of which $448 mn (3000 Cr) is accounted by 134 opportunities. Active Pursuits 34 34 high value active pursuits • 7 pursuits are of value more than INR 50 Cr. each • 10 pursuits are o
Slide 34: Large Digital Transformational Deal Wins
Growth LARGE DIGITAL TRANSFORMATIONAL Assurance DEAL WINS Large Deal Wins in 12 Digital Transformational Deal Wins FY 18 • 4 deal win are of value more than INR 50 Cr. each 12 • 3 deal win are of value between INR 30 Cr - INR 50 Cr. each • 5 deal win are of value between INR 20 Cr - INR 30 Cr. each
Slide 35: Strong Order Backlog
Growth Strong Order backlog Assurance Q4 FY 18 Q1 FY 19 License Based License Based (License, AMC*, Implementation, etc.,) (License, AMC*, Implementation, etc.,) INR 890 Cr INR 950 Cr Subscription Based Subscription Based INR 150 Cr INR 240 Cr (Excluding order backlog of GeM project) (Excluding orde
Slide 36: Margins
Four Elements Growth Moat Assurance Cash Margins 35
Slide 37: FY 18 – Calibrated Growth Yielding Predictability
FY 18 – Calibrated Growth Yielding Predictability Margins FY 18 - TOTAL REVENUE (INR) FY 18 – TOTAL REVENUE (US $) EBITDA GROSS MARGIN (INR) 1087.3 Cr $168.7 Mn 78.6 Cr 538.3 Cr FY 2017-18 1087.3 Cr FY 2017-18 $168.7 Mn FY 2017-18 78.6 Cr FY 2017-18 538.3 Cr FY 2016-17 913.6 Cr FY 2016-17 $ 136.2 Mn
Slide 38: Strong EBITDA Growth and Net Profit Positive Margins
Strong EBITDA Growth and Net Profit Positive Margins 78.6 Cr 1087 Cr EBITDA (in INR) Strong EBITDA Growth FY 17 FY 18 914 Cr (24.96 Cr) Up by 19% Revenue (in INR) FY 17 FY 18 46.7 Cr PAT (in INR) FY 17 FY 18 Positive PAT (22.4 Cr) 37
Slide 39: Cash
Four Elements Growth Moat Assurance Margins Cash 38
Slide 40: Collections Exceed Revenues in the Last 5 Quarters
Cash Collections exceed revenues in the last 5 quarters 314.26 301.70 291.31 270.47 256.43 252.38 230.62 211.51 209.52 184.99 184.14 Q3 FY 16 Q4 FY 16 Q1 FY 17 Q2 FY 17 Q3 FY 17 Q4 FY 17 Q1 FY 18 Q2 FY 18 Q3 FY 18 Q4 FY 18 Q1 FY 19 *INR Cr 39
Slide 41: Confidence About the Future
CONFIDENCE ABOUT THE FUTURE 40
Slide 42: Promise Delivered
PROMISE DELIVERED Top of the League in Has 25% market share Branding and Thought Set for Stage 5 of the in target segment of Leadership Product Cycle – winning 300 chosen Banks with Premium pricing and 80+ installs marquee deals Has acquired 04 Leadership Logos 03 05 Gross margin – 60% in chosen Mar
Slide 43: Promise for FY 19-20
PROMISE FOR FY 19-20 • Intellect Digital Core, IDC 19. 1 • Government eMarketplace • Digital Treasury • Risk Analyst 42
Slide 44: Promise for FY 20-21
PROMISE FOR FY 20-21 • Xponent • Digital Distribution Suite • Digital Wealth • Capital Alpha 43
Slide 45: Summary
SUMMARY 01 Largest suite of FinTech Products for Global market on Unified architecture 04 Delivered against the four expectations in FY 18: Moat, Growth, Margin and Cash License revenues and 02 15 Product Portfolio is designed for continuous growth 05 average deal value moved up since last year 03 P
Slide 46: © 2018, Intellect Design Arena Limited. All rights reserved.
© 2018, Intellect Design Arena Limited. All rights reserved. These materials are confidential and proprietary to Intellect and no part of these materials should be reproduced, published in any form by any means, electronic or mechanical including photocopy or any information storage or retrieval sys