PNB Housing Finance Limited · NSE:PNBHOUSING
PNB Housing Finance — Investor Day (September 2017)
53 slides from PNB Housing Finance's investor day presentation, Sep 28, 2017
Slide 1: Investor Day Presentation
Investor Day Presentation 28th September 2017 1
Slide 2: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by PNB Housing Finance Ltd (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any secur
Slide 3: About PNB Housing Finance
About PNB Housing Finance About PNB Housing Finance 3
Slide 4: Overview
Overview Loan Assets: INR 44,003 Crore Disbursement: INR 7,794 Crore* GNPAs: 0.43% Average Cost of Borrowing: 8.09% No. of employees: 1,124 Book Value Per Share: INR 348 per Share Fastest growing HFC amongst the Top 5 HFCs in India Data as on 30-Jun-17 *Data for Q1 FY17-18 1 Crore= 10 million 4
Slide 5: Our Journey
Our Journey Put in place a Leverage Strong highly Robust technology as an Business process distribution experienced, underwriting, enabler and PNB Housing- a re-engineering network with well- independent and monitoring and facilitator to brand to reckon sponsored by the defined operating professiona
Slide 6: About HFC Sector
About HFC Sector About HFC Sector 6
Slide 7: India's Mortgage Market Overview
India’s Mortgage Market Overview Indian Mortgage Market is Significantly Under-penetrated Mortgage to GDP Ratio for CY2015 (%) 88% 67% 56% 52% 45% 40% 38% 34% 31% 20% 18% 10% Korea Taiwan China (Mar17) Hong Kong Thailand UK Denmark USA Germany Malaysia Singapore India Note: India data for FY17, Othe
Slide 8: Ramp-up Opportunity for Mortgage Market in India
Ramp-up Opportunity for Mortgage Market in India Annual Disbursements (INR Lakh Crore) 9.86 4.15 3.55 3.03 1.56 0.87 0.52 FY04 E FY07 E FY11 E FY15 E FY16 E FY17 E FY22 F Bank HFCs E- Estimated F- Forecast Source: CRISIL Research 6
Slide 9: HFCs Outpacing Traditional Channels
HFCs Outpacing Traditional Channels Increasing HFCs Share in a Steadily Expanding Home Loan Portfolio (INR Lakh Crore) 14 30% 26% 12 25% 21% 10 20% 19% 18% 20% 8 18% 18% 17% 15% 6 15% 15% 10% 4 2 5% 0 0% Mar 13 Mar-14 Mar-15 Mar-16 Mar-17 Banks HFC's Banks Growth HFC's Growth Source: ICRA Industry U
Slide 10: Sustainable Growth of HFCs
Sustainable Growth of HFCs Total Loan of all HFCs Key HFC Metrics (Mar-17) as on 31-Mar-17 Total No. of HFCs: 85 13% 1% 2% 38% 2% Deposit taking HFCs: 18 Top 5 HFCs: 83% 5% Total Loan: INR 7.7 Lakh Crore HDFC LIC HF 10% IBHF DHFL 5 Years CAGR: 20.82% PNBHFL Gruh 11% Can Fin Repco HF 19% Others Portf
Slide 11: Government Initiatives
Government Initiatives Government Initiatives 11
Slide 12: Government Schemes - PMAY
Government Schemes - PMAY • Changes/inclusion in the scheme effective 1-Jan-17 – Existing scheme renamed as PMAY-CLSS for EWS/LIG – Maximum tenure changed from 15 to 20 years – Scheme extended to Middle Income Group (MIG) Category EWS LIG MIG I MIG II Household Income (INR 3 6 12 18 Lakhs per annum)
Slide 13: Government Schemes - RERA
Government Schemes - RERA • RERA - A Game Changer – Short-term should pose some challenges; in the long run customer sentiments should be positive – Brings in accountability and functions in a more transparent manner Customer’s Benefit Developer’s Benefit • Raising the transparency levels • Access t
Slide 14: Expansion Led Growth…
Expansion Led Growth… Government Initiatives 14
Slide 15: Expanding Footprints…
Expanding Footprints… Branches – Point of Sales & Services No. of Branches Processing Hubs – Fountain head for Decision Making 261 Zonal Hubs - Guides, Supervises & Monitors the HUB No. of Branches 85 Unique Cities* 3 66 16 1 9 5 6 7 32 56 40 27 Planned Avg FY14 FY15 FY16 FY17 Q1FY18 Total by Branch
Slide 16: …with Hub and Spoke Target Operating Model…
…with Hub and Spoke Target Operating Model… Field Investigation DSA DST Fraud Control Unit Yes Fountain Head for Decision Making Underwriter reviews the reports and does financial assessment Customer Legal Team Acquisition/ Service No Underwriter File received at HUB Technical Service Group Collecti
Slide 17: …Technology…
…Technology… Enabled Target Operating Model High Business Growth Secured Digital Enterprise 2016-17 Operational Efficiency Enterprise System 2014-16 Solution Security & Compliance Point solutions as Business Enabler 2013-14 Enhanced Customer IT Foundation Satisfaction 2011-12 17
Slide 18: …and Centralized Operations…
…and Centralized Operations… Centralized operational Image based process processing Standardization of processes Reduction in turn • Central Operations around time formalized with an objective Cost optimization to implement best practices, standardize processes and provide predictable cust
Slide 19: …Leading to Disbursement and Asset growth…
…Leading to Disbursement and Asset growth… (INR Crore) Disbursement CAGR +48% 20,639 14,456 9,440 7,794 FY15 FY16 FY17 Q1FY18 Asset CAGR 46,755 +55% 41,492 27,555 17,297 38,531 44,003 27,177 16,819 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17 AUM Loan Asset 1 Crore = 10 million 19
Slide 20: …Employee Efficiency…
…Employee Efficiency… Disbursement / Employee (INR Crore / Employee) Loans Outstanding / Employee (INR Crore / Employee) 24.25 45.28 +19% +22% 21.23 39.91 17.16 30.58 FY15 FY16 FY17 31-Mar-15 31-Mar-16 31-Mar-17 Calculated on Average employees for the Year 20
Slide 21: …with Lower NPAs…
…with Lower NPAs… 0.50% 0.45% 0.43% 0.40% 0.34% 0.33% 0.35% 0.30% 0.26% 0.27% 0.25% 0.19% 0.19% 0.20% 0.15% 0.12% 0.10% 0.05% 0.00% 30-Jun-14 30-Jun-15 30-Jun-16 30-Jun-17 GNPA NNPA 2 years Lagged NPA* 1.2 1 1 0.5 0.5 0.6 31-Mar-15 31-Mar-16 31-Mar-17 PNBHFL Other HFCs GNPA & NNPA is calculated as a
Slide 22: …and Credit Cost
…and Credit Cost Credit Costs* (% of Loan Assets) 0.10% 0.09% 0.07% 0.03% 0.07% 0.02% 0.01% 0.01% 0.07% 0.06% 0.07% 0.06% Q1FY15 Q1FY16 Q1FY17 Q1FY18 NPA Provision Standard Asset Provision INR Crore Provisions 236% 307 250% 210% 310 177% 42 200% 260 204 210 143% 150% 26 160 117 226 100% 110 72 26 15
Slide 23: Our Strengths
Our Strengths People Extensive experience in the mortgage sector. The management team has over 140 years of experience in this industry. Brand Processes Strong parentage brand. Public Work towards faster and seamless reposes lot of confidence in our execution, in compliance with the brand; which sta
Slide 24: Sustainable Portfolio Mix
Sustainable Portfolio Mix Sustainable Portfolio Mix 24
Slide 25: Sustainable Portfolio Mix
Sustainable Portfolio Mix Share of Housing Loans Wide Product Offering (% of Annual Disbursements) (% of Loan Assets) 31 29 30 29 30 29 30 34 69 71 70 71 70 71 70 66 FY15 FY16 FY17 Q1FY18 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17 Non-Housing Housing 25
Slide 26: Housing Loan Assets Distribution
Housing Loan Assets Distribution Housing Loan – 69.8% (1) Individual Housing Loan (1) – 58.8% Construction Finance Loans (1) – 11.1% INR Crore INR Crore 25,852 4,882 22,880 4,382 16,645 10,260 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17 2,471 4% 5% Home Purchase Loans 1,682 5% 1% Residential Plot Loans
Slide 27: Non-Housing Loan Assets Distribution
Non- Housing Loan Assets Distribution Non-Housing Loan(1) – 30.2% INR Crore 15% 13,269 11,269 12% ATS 8,025 INR 78.83 lakhs as on 30-Jun-17 4,878 54% 20% LAP LRD NRPL CTL 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17 1. As a % of Loan Assets on 30-Jun-17 2. 1 Crore = 10 million ATS: Average Ticket Size 27
Slide 28: Customer Segment & Origination
Customer Segment & Origination Loan Book Composition (%) Disbursement Origination (%) As on 30-Jun-17 Q1FY18 Retail- 80.2% 19.8% 34% 41.1% 66% 39.1% Salaried Self-Employed Loans to Corporates In-House DSA 28
Slide 29: Operational and Financial Performance
Operational and Financial Performance Operational and Financial Performance 29
Slide 30: Well Diversified Borrowing Profile
Well Diversified Borrowing Profile Access to a Diverse Base of Funding… Total Borrowing (INR Crore) 16,751 26,159 35,657 39,564 10.6% 7.9% 7.7% 6.7% 7.4% 6.9% 6.8% 2.3% 4.2% 3.8% 20.3% 3.6% 27.2% 28.0% 25.3% 29.2% 16.4% 19.2% 12.3% 9.6% 35.9% 40.9% 40.9% 26.7% 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17
Slide 31: Margin Analysis
Margin Analysis Average Yield Average Cost of Borrowings Spread 11.65% 9.42% 2.23% 2.21% 11.25% 9.07% 2.18% 2.14% 10.76% 8.55% 10.23% 8.09% FY15 FY16 FY17 Q1FY18 FY15 FY16 FY17 Q1FY18 FY15 FY16 FY17 Q1FY18 Ratios are calculated on Monthly Average 31
Slide 32: Income and Asset Quality
Income and Asset Quality Net Interest Margin Gross Non-Performing Asset 1% 0% 0.43% 3.10% 3.16% 2.98% 2.97% 0% 0% 0.34% 0% 0.27% 0.26% 0% 0.22% 0.22% 0.20% 0% 0% 0% 0% 0% FY15 FY16 FY17 Q1FY18 FY15 FY16 FY17 FY18 30th Jun 31st Mar Ratios are calculated on Monthly Average GNPA is calculated as a % of
Slide 33: Operating Leverage playing out
Operating Leverage playing out Opex to ATA Ratio (%) Cost to Income Ratio (%) 30.87% 0.98% 25.15% 0.83% 22.43% 0.73% 0.66% 18.19% FY15 FY16 FY17 Q1FY18 FY15 FY16 FY17 Q1FY18 Ratios are calculated on Monthly Average Opex to ATA is calculated as Operating Expenditure (Employee cost + Other expenses +
Slide 34: Return Efficiencies
Return Efficiencies ROA (%) ROE (%) 17.12% 1.66% 16.08% 1.46% 14.92%* 1.37% 1.28% 13.01% FY15 FY16 FY17 Q1FY18** FY15 FY16 FY17 Q1FY18** Ratios are calculated on Monthly Average * Capital of INR 3,000 Crore raised through IPO of 3,87,19,309 fresh equity shares Return on Asset is on Average Total Ass
Slide 35: Employee Efficiency
Employee Efficiency Disbursement / Employee (INR Crore / Employee) Loans Outstanding / Employee (INR Crore / Employee) +19% +22% 24.25 45.28 21.23 39.91 17.16 30.58 FY15 FY16 FY17 31-Mar-15 31-Mar-16 31-Mar-17 Total Revenue / Employee (INR Crore / Employee) Profitability / Employee (INR Crore / Empl
Slide 36: Maintaining Prudence…
Maintaining Prudence… Maintaining Prudence… 36
Slide 37: …with balanced Asset Liability maturity profile…
…with balanced Asset Liability maturity profile… (INR Crore) 15,302 14,234 13,393 12,455 11,644 11,152 8,645 8,283 Upto 1 yr 1-3 yrs 3-5 yrs Over 5 yrs Assets Liabilities Data as on 30-Jun-17 1 Crore = 10 million 37
Slide 38: …and adequate Capital & Comfortable Gearing
…and adequate Capital & Comfortable Gearing Capital to Risk Asset Ratio (%) 21.62% 20.30% 13.76% 12.70% 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17 Gearing Ratio (x) 10.73 10.77 8.72 6.83 31-Mar-15 31-Mar-16 31-Mar-17 30-Jun-17 Ratio is calculated on Monthly Average 38
Slide 39: Shareholding
Shareholding Shareholding 39
Slide 40: Shareholding
Shareholding Shareholding as on 30-Jun-17 3.3% 0.1% 4.4% 1.5% Key Shareholders 14.5% 38.9% General Atlantic Singapore Fund, Wasatch, Government of Singapore, Motilal Oswal MF, Birla Sunlife MF,, Fidelity Investments, Invesco, Nomura Asset Management, SBI Life Insurance 37.3% Promoters Quality Invest
Slide 41: Saksham – Contributing to the Society
Saksham – Contributing to the Society Detailed Financials 41
Slide 42: Glimpses of Social Interventions
Glimpses of Social Interventions Enhancing Human Potential • Partnered with The Confederation of Real Estate Developers Association of India (CREDAI) to conduct on the job skill training programmes for construction workers Reaching Out, Reaching Far • Collaborated with Mobile Creches and various rea
Slide 43: …winning Awards & Accolades
…winning Awards & Accolades Awarded ‘Best Project Finance Company of the Year’ at Construction Times Builders Award. The honour was bestowed by Shri Vijay Shivtare, Hon’ble Minister of State, Water Resources and Water Conservation, Maharashtra and Shri Rahul Shiwale, Hon’ble Member of Parliament, in
Slide 44: Strong Management Team…
Strong Management Team… Strong Management Team… 44
Slide 45: …with Extensive Industry Experience…
…with Extensive Industry Experience… Age : 54 Years No. of Years with PNB HF : 7 Years Sanjaya Gupta - Managing Director Prior Engagements : AIG, ABN Amro Bank N.V. and HDFC Limited Age : 45 Years Age : 51 Years Age : 55 Years No. of Years with PNB No. of Years with PNB No. of Years with PNB HF HF :
Slide 46: …under the Aegis of a Highly Experienced Board
…under the Aegis of a Highly Experienced Board Mr. Sunil Mehta Dr. Ram S. Sangapure Sunil Kaul Shital Kumar Jain Gourav Vallabh Chairman – Non Executive Non Executive Director Non Executive Director Independent Director Independent Director Age: Age: Age: Age: Age: 57 Years 59 Years 57 Years 77 Year
Slide 47: Key Takeaways
Key Takeaways Strong Distribution Network and Robust TOM Strong distribution network with pan India presence and over 10,500 channel partners across India 01 Improving Cost to Income Ratio Operating leverage playing Growth in Loan Book out, thereby improving our C/I Ratio 05 02 5th largest by Loan A
Slide 48: Annexure
Annexure Annexure 48
Slide 49: Profit & Loss Statement
Profit & Loss Statement Particulars (INR Crore) FY17 FY16 FY15 FY14 FY13 FY12 Revenue from Operations 3,908 2,698 1,777 1,116 642 454 Other Income 0 1 - - 19 9 Total Revenue 3,908 2,699 1,777 1,116 661 463 Expenditure: Finance Cost 2,644 1,860 1,265 801 462 315 Employee Benefit Expenses 101 75 67 40
Slide 50: Balance Sheet – Equity & Liabilities
Balance Sheet – Equity & Liabilities Particulars (INR Crore) Mar-17 Mar-16 Mar-15 Mar-14 Mar-13 Mar-12 Equity and Liabilities Shareholder's Funds 5,577 2,146 1,581 935 621 404 Share Capital 166 127 104 66 50 30 Reserves and Surplus 5,412 2,019 1,477 869 571 374 Non-Current Liabilities 24,477 16,938
Slide 51: Balance Sheet - Assets
Balance Sheet - Assets Particulars Mar-17 Mar-16 Mar-15 Mar-14 Mar-13 Mar-12 Assets Non-Current Assets 37,744 26,656 14,782 8,868 6,449 3,845 Fixed Assets 60 62 58 26 16 4 -Tangible Assets 48 48 38 23 13 4 -Intangible Assets 11 10 1 -Capital Work-in-Progress 2 4 18 3 4 1 Non-Current Investments 961
Slide 52: Glossary
Glossary ATA Average Total Assets HFCs Housing Finance Companies ATS Average Ticket Size LAP Loan against Property AUM Asset Under Management LRD Lease Rental Discounting BVPS Book-value per Share NCDs Non-Convertible Debentures C/I Cost to Income NII Net Interest Income CAR Capital Adequacy Ratio N
Slide 53: Thank You
Thank You Contact PNB Housing Finance Limited CIN: L65922DL1988PLC033856 Ms. Deepika Gupta Padhi - Head-Investor Relations Phone: +91 11 23445214 Investor.relations@pnbhousing.com www.pnbhousing.com