Muthoot Microfin Ltd · NSE:MUTHOOTMF
Muthoot Microfin — Q1 FY2025 Earnings Presentation
41 slides from Muthoot Microfin's earnings presentation, Aug 9, 2024
Slide 1: Stock exchange filing cover letter
Date: August 09, 2024 To, BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, C-1, Block G, Dalal Street, Mumbai – 400 001 Bandra Kurla Complex, Bandra (E) Mumbai – 400 051 Scrip Code: 544055 Scrip Code: MUTHOOTMF Dear Sir/Madam, Sub: Investor Presentation
Slide 2: Investor Presentation - Q1 FY'25
Investor Presentation - | Q1 FY'25 ae? m i ruthoot f MICROFIN / f y Px...
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 Muthoot Microfin Ltd
Slide 4: Presentation Roadmap
Presentation Roadmap 1.Group/Company Overview 2.Business Updates 3.Financial Performance 4.Investment Rationale 02
Slide 5: Presentation Roadmap
Presentation Roadmap 1.Group/Company Overview 2.Business Updates 3.Financial Performance 4.Investment Rationale 03
Slide 6: MPG - Legacy of 138+ years of history in Financial Services
MPG - Legacy of 138+ years of history and 81 years of experience in Financial Services business Muthoot Pappachan Group (MPG) is a Well Diversified Business Conglomerate Our Promoters Other Businesses Automotive Hospitality Thomas Muthoot Managing Director, MML ` Real Estate Information Technology I
Slide 7: Brand Recall and Synergies with the Muthoot Pappachan Group
Brand Recall and Synergies with the Muthoot Pappachan Group MPG’s Stronghold is the bottom of the pyramid underserved customers Target Customer segment of group Client base 3.40 Mn 5 Mn 0.5 Mn 35K MML is the first level of Customer can progressively graduate to gold loans, entry into formal financia
Slide 8: Journey So Far
Journey So Far 2on fl. 2015 2016 Vex. 2017 Vex. 2018 FN Ven. Company was acquired RBI granted NBFC-MFI Raised 500 Mn from + Crossed 1 Mn clients + Raised 22,200 Mn ina rights issue from by promoters of “Muthoot status with effect from Creation + Raised 2150 Mn and 2350 Mn existing investors - MFL: 2
Slide 9: Strong Corporate Governance and Support from Promoters & Investors
Strong Corporate Governance and Support from Promoters & Investors Shareholding as of 30th Board of Directors Individual Thomas John Promoter Directors Promoters, 5.26% Thomas George Institutions Promoter Thomas Muthoot Muthoot Muthoot, Domestic, 2.29% holding Managing Director Promoter, Non Executi
Slide 10: Key Managerial Personal
Key Managerial Personal Note: 1. Employee Data as on Jun 30, 2024 The employee composition displayed in the chart excludes 488 loan officers on the Team Lease payroll. 08
Slide 11: Presentation Roadmap: Business Updates
Presentation Roadmap 1.Group/Company Overview 2.Business Updates 3.Financial Performance 4.Investment Rationale 09
Slide 12: Key Challenges
Key Challenges: - * Source – IMD Newsletter – Apr’24 to Jun’24 * Source – MFIN-QAR Q3 FY’24 High Impact Moderate Impact Low Impact Unprecedented Heat waves Multi-Phased Elections Karza Mukti Abhiyan The above chart depicts the heat wave occurrences days for the month of This chart represents the dis
Slide 13: Strategic initiatives & Risk mitigants
Strategic initiatives & Risk mitigants Sourcing Collection Process Quality Collection TAT improvement Focus on Score card Team initiatives customer retention NATCAT Insurance Dynamic voice drop Socio-economic Process for on-time payment profiling being Optimisation implemented E-Clinic Analytics Dig
Slide 14: Operational Performance – Q1 FY'25
Operational Performance – Q1 FY’25 AUM Disbursements Branches Active Clients INR 122,103 Mn INR 22,043 Mn 1,562 3.4 Mn (+21.6% YoY, (-11.2% YoY, (+27.0% YoY, (+13.1% YoY, 100,376 Mn) 24,812 Mn) 1,230) 3.0 Mn) Employees Collection Efficiency GNPA NNPA¹ 96% 2.10% 0.71% 13,819 (-3.0% YoY,98.9%) CE Incl
Slide 15: Financial Performance – Q1 FY'25
Financial Performance – Q1 FY’25 Income PPOP PAT NIM INR 6,412 Mn INR 2,226 Mn INR 1,132 Mn 13.3% (+33.5% YoY, (+50.4% YoY, (+18.3% YoY, (+123 bps YoY, 4,801 Mn) 1,480 Mn) 957 Mn) 12.1%) Opex/GLP Ratio COF ROA Equity 6.0% 11.07% 3.71% INR 29,241 Mn (-15 bps YoY, 11.22%) (-29 bps YoY, 4.01%) (+69.2%
Slide 16: Key Operational & Financial Highlights
Key Operational & Financial Highlights Operation & Financial Performance Q1FY25 Q1FY24 YoYGrowth Q4FY24 QoQGrowth Resilient business with adequate Controls Assets Under Management (in mns) 1,22,103 1,00,376 21.64% 1,21,935 0.14% Branches (Count) 1,562 1,230 26.99% 1,508 3.58% • The company showcased
Slide 17: Consistent Growth
Consistent Growth AUM (Mn) Disbursement (Mn) Client Count (Mn) Client (Mn) Avg OS/Client ('000) 1,21,935 1,22,103 36 1,08,671 1,14,581 28,879 33 34 35 36 1,00,376 27,004 25,921 24,812 22,043 3.2 3.3 3.4 3.4 3.0 Q1 FY'24 Q2 FY'24 Q3 FY'24 Q4 FY'24 Q1 FY'25 Q1 FY'24 Q2 FY'24 Q3 FY'24 Q4 FY'24 Q1 FY'25
Slide 18: Resilient Business Model – Proven over time
Resilient Business Model – Proven over time No. of loans (Lks) % of amont disbursed Risk Category From Q4-FY'24 Q1-FY'25 From Q4-FY'24 Q1-FY'25 Inception Inception Very Low 13.01 1.68 1.07 70.29% 68.86% 71.79% Low 5.24 0.78 0.43 27.14% 30.16% 27.28% Medium 0.59 0.03 0.02 2.57% 0.98% 0.93% Total 18.8
Slide 19: Systemic Diversification with focused business in Target States
Systemic Diversification with focused business in Target States Portfolio Concentration (Region-wise Trend) Disbursement Spread (Region-wise Trend) 11% 12% 12% 12% 12% 11% 11% 11% 11% 11% 13% 13% 14% 14% 15% 16% 16% 17% 13% 14% 22% 23% 23% 23% 23% 26% 23% 23% 24% 24% WEST 9% 9% 9% 9% 9% 9% 10% 9% 9%
Slide 20: Digitization driving Collections
Digitization driving Collections Customer App Installation (Cum. In Mn)1 Digital Collection (Mn) Digital Collection Share%2 6,388 5,633 5,980 1.58 1.63 1.66 26.44% 26.28% 26.33% 26.82% 1.50 4,887 24.62% 1.38 4,628 Q1 FY'24 Q2 FY'24 Q3 FY'24 Q4 FY'24 Q1 FY'25 Q1 FY'24 Q2 FY'24 Q3 FY'24 Q4 FY'24 Q1 FY
Slide 21: Key Metrics
Key Metrics Branch Count RO Count AUM Per Branch (Mn) 8,571 8,539 81.6 1,508 1,562 7,996 81.1 80.9 1,424 7,493 80.5 1,340 6,696 1,230 78.2 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 AUM Per RO (Mn) Client Per Branch Client
Slide 22: Asset Quality Update
Asset Quality Update GNPA NNPA & Provision Coverage Stage 1 (0-30) GNPA Ratio NNPA Ratio (Net of total provision) 96.4% 96.6% NNPA Ratio (Net of Stage III provision) Provision Coverage (Net of total provision) 96.1% Provision Coverage (Net of Stage III provision) 7.39% 89.1% 6.26% 81.7% 86.4% 86.0%
Slide 23: Presentation Roadmap: Financial Performance
Presentation Roadmap 1.Group/Company Overview 2.Business Updates 3.Financial Performance 4.Investment Rationale 21
Slide 24: Robust fiscal year performance in terms of Income/Profitability (1/3)
Robust fiscal year performance in terms of Income/Profitability (1/3) Revenue from Operations Total income (in Mns) 22,855 20.8% 20.9% 19.0% 17.0% 15.5% 14,463 8,429 6,963 6,412 FY 21 FY 22 FY 23 FY 24 Q1 FY 25 FY 21 FY 22 FY 23 FY 24 Q1 FY 25 PPOP (in Mns) PAT (in Mns) 4,496 7,638 4,362 1,639 2,226
Slide 25: Robust fiscal year performance in terms of Income/Profitability (2/3)
Robust fiscal year performance in terms of Income/Profitability (2/3) Cost Ratio’s Cost to Income Net Interest Margin Opex Ratio Provisioning Cost 64.4% 65.0% 12.7% 13.3% 11.9% 51.4% 10.3% 45.5% 44.9% 8.9% 6.9% 5.8% 6.2% 6.0% 6.0% 3.0% 3.0% 2.5% 2.3% 1.7% FY 21 FY 22 FY 23 FY 24 Q1 FY 25 FY 21 FY 22
Slide 26: Robust Quarterly performance in terms of Income/Profitability (3/3)
Robust Quarterly performance in terms of Income/Profitability (3/3) Cost Ratio’s Cost to Income Net Interest Margin Opex Ratio Provisioning Cost 48.7% 48.2% 13.5% 13.3% 12.8% 12.6% 12.1% 45.3% 44.9% 5.8% 6.0% 6.1% 6.0% 6.0% 41.8% 2.3% 2.5% 1.6% 1.9% 0.8% Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q1FY24 Q2F
Slide 27: Quarterly Performance
Quarterly Performance Total Income (in Mns) NIM (in Mns) PPOP (in Mns) 6,534 6,412 5,761 5,848 4,000 2,441 3,826 2,226 4,801 3,379 3,431 1,893 1,823 2,801 1,480 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 PAT (in Mns) PAT/RO
Slide 28: P&L Statement
P&L Statement (in Mns) Financial Comparison Q1 FY 25 Q1 FY 24 YoY (%) Q4 FY 24 QoQ (%) Income Revenue from operations 6,378.83 4,787.02 33.25% 6,468.07 -1.38% Other income 32.78 14.43 127.23% 66.18 -50.46% Total income 6,411.61 4,801.45 33.53% 6,534.25 -1.88% Expenses Finance costs 2,370.52 1,943.04
Slide 29: Balance Sheet
Balance Sheet (in Mns) Financial Assets Q1 FY 25 FY 24 Financial Liabilities Q1 FY 25 FY 24 Cash and cash equivalents 10,695.5 9,576.7 Total outstanding dues of creditors 97.8 138.9 Bank balances other than cash 6,362.1 6,210.6 Debt securities 7,409.1 9,624.4 Other receivables 2,492.8 2,574.8 Borrow
Slide 30: Balance Sheet Metric
Balance Sheet Metric Networth (Mns) CRAR 30.3% 29,241 28.8% 29.0% 28,044 22.6% 21.9% 16,258 13,366 8,899 FY 21 FY 22 FY 23 FY 24 Q1 FY25 FY 21 FY 22 FY 23 FY 24 Q1 FY25 Debt/Equity Cost of Borrowing 3.99 11.2% 11.1% 11.07% 2.94 2.99 2.98 2.88 10.9% Incremental Cost of Borrowing: 10.4% 10.34% FY 21 F
Slide 31: Funding profile
Funding profile Liquidity-Current Position (in Mns) Lender wise Outstanding Q1 FY 25* 17,871 13,715 10,633 Financial Domestic DFI, 8.8% Retail, 4.0% Institutions/SFB, Foreign DFI, 5.7% 4.8% Liquid funds in hand DA/PTC Sanction Pending Term Funding Sanctions Foreign Banks, unutilised 12.3% Funding Pr
Slide 32: Liquidity – Static Liquidity Position
Liquidity – Static Liquidity Position Static ALM Maturity ALM 4,207.2 45,927.3 41,743.3 3,767.9 3,197.2 33,619.9 26,949.7 2,282.7 1,868.6 19,252.9 18,267.1 17,399.9 1,597.9 21,682.5 17,498.6 1,623.4 15,012.3 666.8 655.3 653.2 7,023.6 7,136.1 6,460.3 5,660.0 5,412.9 573.7 1,184.2 494.5 468.8 709.0 11
Slide 33: Presentation Roadmap: Investment Rationale
Presentation Roadmap 1.Group/Company Overview 2.Business Updates 3.Financial Performance 4.Investment Rationale 31
Slide 34: Robust Risk Management via use of Technology
Robust Risk Management via use of Technology Risk Management Framework Dedicated Credit Managers at all Efficient and Independent Internal Unique credit score developed along Collections branches Audit & Compliance team with Equifax 1,704 Area Credit Managers and Credit Managers supervised by 396 Au
Slide 35: Internal Controls
Internal Controls Field Monitoring Comprehensive Field Visit Policy. Loan Appraisal System driven field visit target setting & measurement Aadhar based E-Signing Liveliness Mobile app-based visit recording with Geo-tagging. In Application check list to certifying compliance. GRT’s St
Slide 36: Digital Eco-system
Digital Eco-system Suvidha Loan Client Web App Login Whatspp App CB Enquiry Credit Score Run UPI SMS Mandate Penny Drop Verification Tele Verification Dynamic BBPS Document QR E-Sign Bank AC Credit UPI BHIM Payements Voice Suvidha Disb: 126.84 Crs Suvidha Clients: 35,224 Note : Express loan processe
Slide 37: Technology Interventions
Technology Interventions Customer Group Group Loan Sanction Centre Onboarding Training Confirmation & Disbursement Meeting Score card-based Nominee KYC System supported Multiple payment exposure Verification group evaluation E-signing channels Real time CB System supported Master Centre Digital acce
Slide 38: Crafted and Curated for customer empowerment
Crafted and Curated for customer empowerment Diverse product portfolio tailored for customer needs Individual Loan Flexible repayment frequency and loan tenure Ticket Size – 60K – 300K | Tenure – 24 – 36 Months Ticket size based on credit performance Retail Muthoot Small & Growing Business (MS
Slide 39: Past Five Years Performance Track Record
Past Five Years Performance Track Record AUM (Mn) Disbursements (Mn) Borrowers (Mn) CAGR 26% CAGR 27% CAGR 16% 121,935 106,616 3.35 81,045 2.77 92,083 2.05 1.88 1.86 62,550 46,470 48,386 49,867 40,829 26,367 FY-20 FY-21 FY-22 FY-23 FY-24 FY-20 FY-21 FY-22 FY-23 FY-24 FY-20 FY-21 FY-22 FY-23 FY-24 Br
Slide 40: Glossary
Glossary Particulars Definition Cost of borrowing represents annually weighted average interest cost on borrowings, weights being annual average borrowings. Borrowings include debt securities, Cost of Borrowing(%) subordinated liabilities, and borrowings (other than debt securities) Cost to Income r
Slide 41: Thank You
THANK YQU! 7