Cholamandalam Investment And Finance Co. Ltd. · NSE:CHOLAFIN

Cholamandalam Investment And Finance — Q3 FY2022 Earnings Presentation

92 slides from Cholamandalam Investment And Finance's earnings presentation, Feb 1, 2022

1. Slide 1: Board meeting outcome letter to stock exchanges

   February 1, 2022 The Secretary The Secretary National Stock Exchange of India Limited BSE Ltd. Trade World, 4th Floor, Kamala Mills Compound 1st Floor, P.J. Towers Senapati Bapat Marg, Lower Parel, Dalal Street, Fort, Mumbai 400 013 Mumbai 400 001 NSE SCRIP CODE: CHOLAFIN EQ BSE SCRIP CODE: 511243 N

2. Slide 2: Interim dividend and analyst call schedule

   The interim dividend shall be paid to those shareholders whose names appear in the register of members as on the record date in respect of shares held in physical form and in case of shares held in dematerialised form, as per the details to be furnished by the depositories as on the record date. The

3. Slide 3: Corporate Presentation - December 2021

   CORPORATE PRESENTATION - DECEMBER 2021

4. Slide 4: 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. Environmental 8. Risk performance Social Governance management 2

5. Slide 5: Murugappa Group Overview

   Murugappa Group Overview 3

6. Slide 6: Murugappa Group in a Nutshell

   Murugappa Group in a Nutshell Consolidated Group Market 121 Years of $4.2 $22.4 Turnover cap (as on 31st Years Existence B B (FY21) Dec 2021) Listed 3 Sectors 29 Businesses 10 Companies 19 Geographical 90+ Manufacturing 51,000+ Work force Countries Presence Locations Locations 4

7. Slide 7: Murugappa Group Overview

   Murugappa Group Overview Murugappa Group Agriculture Engineering Financial services Market Cap(Cr.) 30,183 52,461 54,930 Turnover (Cr.) 18,545 8,432 14,030 PAT(Cr.) 2,020 589 1,824 Market Cap(Cr.) 22,177 8,066 18,635 33,827 42,723 NA 12,207 Turnover (Cr.) 14,145 4,400 2,604 5,827 9,584 4,388 58 PAT(

8. Slide 8: Corporate Overview

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9. Slide 9: 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

10. Slide 10: Cholamandalam Investment & Finance Company Limited

    Cholamandalam Investment & Finance Company Limited 17.2 lakh + customers 31,477 employees Helping customers enter better life Experienced team to serve more customers 2 lakh customers in year 2000 to 17.2 lakh plus customers till date 200 plus employees in year 2000 to 31,000+ employees today Rs. 72

11. Slide 11: Our journey so far

    Our journey so far FY 2020-21 FY 2021-22 FY 2015-20 2022 – YTD Dec21 2016 2021 • GNPA recognition at 120 days • AUM crossed ₹69k Cr. • Reaffirmed as • AUM crossed ₹30K Cr. • Increased branch constituent of FY 2010-15 FTSE4Good Index • New LEAP LOS Digital platform network to 1137. • LMS v3.12 platfo

12. Slide 12: Shareholding

    Shareholding Shareholding Pattern Institutional Holders (More than 1%) Top Domestic Institutional Holding • Axis Mutual Fund • HDFC Mutual Fund • Birla Sun Life Mutual Fund • DSP Mutual Fund • SBI Mutual Fund • UTI Mutual Fund Top Foreign Institutional Holding • Capital World o Promoters’ share hold

13. Slide 13: Business Profile and AUM as on 31st Dec 2021

    Business Profile and AUM as on 31st Dec 2021 Business AUM Rs. 72,724Cr Vehicle Finance LAP & SME Home Loan & Others Rs. 50,675Cr Rs. 16,916Cr Rs. 5,133Cr 70% 23% 7% Others Used 2% Vehicles Resale 13% BT 4% 27% HCV 8% Top-Up 1% Tractor LCV 21% Self- 10% Construction Builder 53% Purchase - CE 6% New 2

14. Slide 14: Strong Geographical Presence

    Strong Geographical Presence Jammu & Kashmir (5) Punjab (23) Himachal Pradesh (17) Chandigarh (2) 1142 Uttarakhand (16) 1140 Haryana (32) Sikkim (1) Arunachal 1137 1137 Delhi (5) Pradesh (1) Rajasthan (83) UP (72) Assam (25) FY21 Q1FY22 Q2FY22 Q3FY22 Meghalaya (3) Bihar (43) Gujarat Mizoram (1) Madh

15. Slide 15: Financial Performance

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16. Slide 16: Financial Snapshot — 10 Years

    Financial Snapshot —10 Years FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 CAGR CAGR Financials Snapshot YoY (10 IGAAP IGAAP IGAAP IGAAP IGAAP IGAAP INDAS INDAS INDAS INDAS (5 years) years) Disbursem ents 8,889 12,118 13,114 12,808 16,380 18,591 25,114 30,451 29,091 26,043 -10% 9% 13% A ssets un

17. Slide 17: Disbursements

    Disbursements Disbursements (₹Cr) Disbursements (%) 27% *22,272 107 1,129 * 17,972 4,881 0% 1% 1% 5% 5% 6% 6% 5% 4% 6% 5% 1,004 5% 17% 18% 21% 16% 20% 24% 21% 2,871 32% * 10,430 106 * 8,706 437 1 * 7,926 2,241 494 16,654 90% * 6,457 2,051 434 78% 74% 71% 77% 73% 78% 1,408 14,096 73% 381 * 3,589 * 3,

18. Slide 18: Assets Under Management

    Assets Under Management Business - Assets under Management (₹Cr) Business - Assets under Management (%) * 72,724 * 67,821 * 70,023 * 68,745 94 * 67,182 1 5,039 0% 0% * 63,501 4,765 5% 7% 5% 7% 5% 7% 4,402 3,630 3,932 3,302 14,877 16,916 21% 22% 22% 23% 22% 14,288 15,971 23% 15,015 13,371 49,264 49,2

19. Slide 19: Profitability and Net worth

    Profitability and Net worth Profit after tax (₹Cr) Networth (₹Cr) *11,074 1457 *10,421 164 *9,887 164 *9,409 1272 164 *8,987 *8,595 164 164 164 10,909 9,723 10,256 -24% 8,823 9,245 607 8,431 524 431 432 409 327 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY2

20. Slide 20: Asset Ratios

    Asset Ratios Net Income Margin (%) Expenses Ratio (%) 8.1% 7.6% 7.7% 7.8% 7.7% 7.3% 7.1% 2.9% 2.9% 2.6% 6.1% 2.2% 2.1% 2.1% 2.1% 2.1% Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 Loan Losses & Provisions (%) R

21. Slide 21: Shareholders' Returns Ratios

    Shareholders’ Returns Ratios Return on equity (%) Earnings per share (₹) 23.7% 29.3 20.6% 19.5% 19.3% 17.6% 21.1 20.9 19.8 19.8 13.5% 16.0 Q1 Q1 Q2 Q2 Q3 Q3 Q1 Q1 Q2 Q2 Q3 Q3 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21 FY22 P/E Ratio P/BV Ratio 32.1 4.4 4.3 26.3 3.9 3.4 19.2 19.6 2.3 11.9

22. Slide 22: Profit and Loss Statement (As per IND AS)

    Profit and Loss Statement (As per IND AS) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 3,589 3,635 6,457 8,706 7,926 10,430 32% 17,972 22,772 27% Closing Assets (Managed) 70,826 75,763 74,471 75,063 75,813 79,161 4

23. Slide 23: Balance Sheet (As per IND AS)

    Balance Sheet (As per IND AS) ₹ Cr Particulars Dec-20 Mar-21 Dec-21 ASSETS Financial Assets 62,061 73,365 77,025 Cash and Bank balance 5,430 5,232 5,114 Derivative financial instruments 70 46 124 Receivables 53 66 108 Loans 56,038 65,839 69,600 Investments 73 1,619 1,640 Other Financial Assets 397 5

24. Slide 24: Stagewise Assets & Provision Summary

    Stagewise Assets & Provision Summary ₹ Cr Dec-20 Dec-20 Dec-20 Dec-21 Dec-21 Dec-21 Dec-20 Dec-20 Dec-20 Dec-21 Dec-21 Dec-21 Mgt Mgt Mgt Mgt Particulars Normal Total Normal Total Normal Total Normal Total Overlay Overlay Overlay Overlay INR Cr INR Cr INR Cr INR Cr INR Cr INR Cr % to GA % to GA % to

25. Slide 25: Stagewise ECL Summary – Dec 21

    Stagewise ECL Summary – Dec 21 Normal Total Normal Total Mgmt Mgmt Particulars Asset Model Overlay Provn NNPA Asset Model Overlay Provn NNPA Rs in Cr % Stage 1 (A ) 60,446 190 13 203 60,243 83.38% 0.31% 0.02% 0.34% 83.10% Stage 1A (B ) 33 0 0 0 33 0.05% 1.10% 0.01% 1.11% 0.05% Stage 1B (C ) 254 10 1

26. Slide 26: Stage 3 Assets Product-wise

    Stage 3 Assets Product-wise Closing Gross Stage 3 ECL Provision Net Net Asset Class Asset Stage 3 Asset % Provision Coverage Stage 3 Stage 3% Dec'21 72,499 4,244 5.85% 1,647 38.80% 2,598 3.58% VF 51,895 2,850 5.49% 1,132 39.72% 1,718 3.31% LAP 14,925 1,176 7.88% 411 34.99% 764 5.12% HL 4,841 167 3.4

27. Slide 27: Chola – Stage 3 Assets Trend

    Chola –Stage 3 Assets Trend As per revised RBI norms GNPA% & NNPA% as of December’21 is at 8.53% and 5.76% respectively 25

28. Slide 28: Business Overview

    Business Overview 26

29. Slide 29: Vehicle Finance

    Vehicle Finance

30. Slide 30: Vehicle Finance: Q3FY22 Performance

    Vehicle Finance: Q3FY22 Performance Disbursements • Disbursements grown by 26% in Q3 FY 22 as compared to Q3 FY 21. Assets under management • AUM have grown by 1% YoY Loss and • Loan losses improved to 1.4% from 3.0% in Q3 of FY 21 provisions Profit before tax • PBT grew by 68% in Q3 FY 22 as compar

31. Slide 31: Sector outlook – Vehicle Finance business (1/1)

    Sector outlook – Vehicle Finance business (1/1) Sector Outlook Chola’s Position • The Tractor industry had a de-growth of 13% in Q3 • More than 80% of our branches are present in the FY’22 & a marginal growth of 1% as of YTD Dec’21. rural areas, towns and semi urban areas which gives The sales momen

32. Slide 32: Sector outlook – Vehicle Finance business (1/2)

    Sector outlook – Vehicle Finance business (1/2) Sector Outlook Chola’s Position  The Heavy commercial vehicle segment had a • Our exposure in this segment is around 8% at a growth of 25% in Q3 FY’22 & 87% growth as of YTD portfolio level. We are closely monitoring this Dec’21 on account of a very l

33. Slide 33: Sector outlook – Vehicle Finance business (1/3)

    Sector outlook – Vehicle Finance business (1/3) Sector Outlook Chola’s Position  The Two-wheeler industry had a de-growth of 25% in • The company intends to maintain its focus on two- Q3 FY’22 & 6% de-growth as of YTD Dec’21. The wheeler funding with a clear eye for credit semiconductor issue had a

34. Slide 34: Auto Industry Outlook

    Auto Industry Outlook Trend in Domestic LCV Sales Trend in Domestic SCV Sales (in Units) (in Units) 85,135 1,59,887 CAGR @ 10% Chola @ 15% CAGR @ 10% Chola @ 25% 66,358 (6%) (4%) 58,747 1,06,964 52,862 97,398 99,277 50,490 92,857 Q3 FY'19 Q3 FY'20 Q3 FY'21 Q3 FY'22 Q3 FY'26 (E) Q3 FY'19 Q3 FY'20 Q3

35. Slide 35: Auto Industry Outlook

    Auto Industry Outlook Trend in Domestic HCV Sales Trend in Domestic Car & MUV Sales (in Units) 1,01,436 (in Units) Chola @ 84% CAGR @ 20% Chola @29% 14,46,211 25% CAGR @ 10% 66,985 (15%) 51,137 8,97,983 7,84,612 7,86,477 7,61,478 40,765 37,186 Q3 FY'19 Q3 FY'20 Q3 FY'21 Q3 FY'22 Q3 FY'26 (E) Q3 FY'1

36. Slide 36: 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

37. Slide 37: 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

38. Slide 38: Vehicle Finance - Disbursement/Portfolio Mix – Q3FY22

    Vehicle Finance - Disbursement/Portfolio Mix – Q3FY22 Well diversified across geography Disbursements - State wise Portfolio - State wise MP AP MP AP Karnataka Karnataka Maharashtra Maharashtra 6% 6% Kerala Kerala 6% 6% 5% 10% Puducherry 6% Puducherry Gujarat 10% 4% 5% 0% Telangana Telangana Gujarat

39. Slide 39: Vehicle Finance - Disbursement/Portfolio Mix – Q3FY22

    Vehicle Finance - Disbursement/Portfolio Mix – Q3FY22 Well diversified product segments Disbursements (₹Cr) - Product wise Portfolio (₹Cr) - Product wise 3 Wheeler HCV 3 Wheeler HCV CE CE 1% 4% 0.3% 9% 6% LCV 6% 2 Wheeler 2 Wheeler 18% 7% 4% LCV 21% MUV 8% Used Vehicles 27% CAR Used Vehicles MUV 10%

40. Slide 40: Vehicle Finance - Disbursement Mix – Quarter-wise

    Vehicle Finance - Disbursement Mix – Quarter-wise Disbursement (₹Cr) - Product wise Disbursement (%) – Product wise * 7,647 447 6% 8% 6% 6% 6% 333 3% 4% 5% 5% * 6,084 * 6,153 * 6,161 7% 1,332 16% 17% Yield Low 383 504 397 18% 19% 164 279 20% 413 5% 569 7% 944 8% 8% 1,158 9% Medium 1,231 6% Yield 776

41. Slide 41: Vehicle Finance - Portfolio Mix – Quarter-wise

    Vehicle Finance - Portfolio Mix – Quarter-wise Portfolio (₹Cr) - Product wise Portfolio (%) – Product wise 6% 6% 6% 6% 6% * 49,936 * 50,415 50,675 * 48,403 * 49,285 10% 9% 9% 9% 8% Low Yield 2,882 3,069 3,189 2,982 3,083 5,041 4,882 3,937 4,560 4,313 21% 20% 21% 21% 21% 10,568 Medium Yield 10,209 10

42. Slide 42: Vehicle Finance - Disbursements and Asset Under Management

    Vehicle Finance - Disbursements and Asset Under Management Disbursements (₹Cr) Assets under management (₹Cr) * 49,936 * 50,675 *48,403 *49,264 *49,285 *46,828 891 1,910 1,103 1,692 1,295 2,054 16,654 14,096 47,108 47,354 48,182 48,244 49,785 44,775 7,647 6,161 6,084 4,781 3,231 2,846 Q1 Q1 Q2 Q2 Q3

43. Slide 43: Vehicle Finance - Income and Profit before tax

    Vehicle Finance - Income and Profit before tax Income (₹Cr) Profit before tax (₹Cr) 24% 1,369 5,719 5,493 1,108 68% 591 521 440 1,905 1,885 1,892 1,922 1,922 359 1,686 309 258 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22

44. Slide 44: Vehicle Finance - Asset Ratios

    Vehicle Finance - Asset Ratios Net Income Margin (%) Expense Ratio (%) 8.8% 3.5% 8.6% 8.6% 3.3% 8.4% 8.0% 3.1% 7.7% 7.5% 6.8% 2.5% 2.6% 2.5% 2.5% 2.5% Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 Loan Losses &

45. Slide 45: Profit and Loss Statement - Vehicle Finance (Managed)

    Profit and Loss Statement - Vehicle Finance (Managed) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 3,231 2,846 4,781 6,161 6,084 7,647 26% 14,096 16,654 18% Closing Assets (Managed) 46,828 48,403 49,264 49,285 49,9

46. Slide 46: Profit and Loss Statement - Vehicle Finance (On Book)

    Profit and Loss Statement - Vehicle Finance (On Book) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 3,231 2,846 4,781 6,161 6,084 7,647 26% 14,096 16,654 18% Closing Assets (On B/S) 44,775 47,108 47,354 48,182 48,24

47. Slide 47: Loan Against Property

    Loan Against Property

48. Slide 48: Loan Against Property – Q3 FY22 Performance

    Loan Against Property – Q3 FY22 Performance Disbursements • Disbursements grown by 39% in Q3 FY 22 as compared to Q3 FY 21. Asset under • AUM have grown by 12% YoY. management • Loan losses increased to 1.4% from 1.2% in Q3 of FY 21 which is due Loss and provisions to additional overlay provisions c

49. Slide 49: Loan Against Property: Industry outlook

    Loan Against Property: Industry outlook Sector Outlook Chola’s Position • MSME sector witnessed high impact of the first and • On back of improved economic activities, Business second wave of the pandemic in fiscal 2021 and in Q1 has witnessed increased demand for LAP loans and fiscal 2022 respectiv

50. Slide 50: Loan Against Property - Disbursements and Asset Under Management

    Loan Against Property - Disbursements and Asset Under Management Disbursements (₹Cr) Assets under Management (₹Cr) 59% * 16,218 3,884 * 15,421 * 14,513 * 14,457 1,680 * 13,866 1,828 * 13,109 1,961 2,218 2,351 2,427 2,436 65% 39% 14,537 1,736 1,763 13,592 12,552 12,239 11,516 10,683 1,265 225% 1,052

51. Slide 51: Loan Against Property – Income and Profit before tax

    Loan Against Property – Income and Profit before tax Income (₹Cr) Profit before tax (₹Cr) 298 1,345 1,208 238 -25% 130 470 103 432 442 423 386 399 86 87 65 65 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 49

52. Slide 52: Loan Against Property – Asset Ratios

    Loan Against Property – Asset Ratios Net Income Margin (%) Expenses Ratio (%) 1.3% 5.1% 4.8% 4.8% 1.2% 4.7% 4.4% 1.1% 4.1% 3.9% 3.9% 0.9% 0.9% 0.9% 0.8% 0.8% Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 Loan L

53. Slide 53: Profit and Loss Statement - Loan Against Property (Managed)

    Profit and Loss Statement - Loan Against Property (Managed) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 119 386 1,052 1,736 1,265 1,763 39% 2,436 3,884 59% Closing Assets (Managed) 13,109 14,513 13,866 15,421 14,4

54. Slide 54: Profit and Loss Statement - Loan Against Property (On Book)

    Profit and Loss Statement - Loan Against Property (On Book) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 119 386 1,052 1,736 1,265 1,763 39% 2,436 3,884 59% Closing Assets (On B/S) 10,683 12,552 11,516 13,592 12,23

55. Slide 55: Home Loans

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56. Slide 56: Home Loans – Q3 FY22 Performance

    Home Loans – Q3 FY22 Performance Disbursements • Disbursements grown by 1% in Q3 FY 22 as compared to Q3 FY 21 Asset under • AUM have grown by 28% YoY. management Loss and provisions • Loan losses at 1.2% in Q3 FY 22 as compared to 2.8% in Q3FY 21. Profit before tax • PBT grew by 154% in Q3 FY 22 as

57. Slide 57: Home Loans - Industry outlook

    Home Loans - Industry outlook Sector Outlook Chola’s Position Immediate term: • Chola does not have material under construction • Despite the Covid wave 3 Affordable housing demand exposure to developer supplied houses is expected to remain intact as economic disruptions • Chola’s LTV at a portfolio

58. Slide 58: Home Loans - Disbursements and Asset Under Management

    Home Loans - Disbursements and Asset Under Management Disbursements (₹Cr) Assets under Management (₹Cr) *5,039 *4,765 1,129 *4,402 553 579 1,004 602 *3,932 *3,630 *3,302 643 668 688 4,486 4,186 494 3,801 434 437 3,288 5% 381 2,962 2,613 190 199 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 FY21 FY22 F

59. Slide 59: Home Loans - Income and Profit before tax

    Home Loans - Income and Profit before tax Income (₹Cr) Profit before tax (₹Cr) 492 89% 148 367 78 154% 38% 164 174 55 154 51 124 132 41 111 28 29 22 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 57

60. Slide 60: Home Loans – Asset Ratios

    Home Loans – Asset Ratios Net Income Margin (%) Expenses Ratio (%) 7.6% 7.8% 7.5% 7.3% 2.4% 2.4% 2.4% 7.0% 6.7% 6.6% 2.2% 2.2% 6.2% 2.1% 1.9% 1.6% Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 FY21 FY22 FY21 FY22 FY21 FY22 Dec20 Dec21 Loan Losses & Pro

61. Slide 61: Profit and Loss Statement - Home Loans (Managed)

    Profit and Loss Statement - Home Loans (Managed) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 190 199 381 494 434 437 30% 1,004 1,129 21% Closing Assets (Managed) 3,302 4,402 3,630 4,765 3,932 5,039 31% 3,932 5,039

62. Slide 62: Profit and Loss Statement - Home Loans (On Book)

    Profit and Loss Statement - Home Loans (On Book) ₹ Cr Growth % Growth % Particulars Q1FY21 Q1FY22 Q2FY21 Q2FY22 Q3FY21 Q3FY22 YTD Dec20 YTD Dec21 (YTD) Q3-o-Q3 Y-o-Y Disbursements 190 199 381 494 434 437 1% 1,004 1,129 12% Closing Assets (On B/S) 2,613 3,801 2,962 4,186 3,288 4,486 36% 3,288 4,486 3

63. Slide 63: Funding Profile

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64. Slide 64: CAR and Credit Rating

    CAR and Credit Rating Capital Adequacy Ratio (CAR) – As per RBI guideline Tier I Tier II 20.69 19.07 19.08 19.63 19.79 17.36 5.41 3.93 2.48 2.96 2.99 4.92 15.28 15.14 16.60 16.67 16.80 12.44 FY19 FY20 FY21 Q1FY22 Q2FY22 Q3FY22 Minimum CAR Stipulated by RBI is 15% & for Tier I is 10% Credit Rating Lo

65. Slide 65: Diversified Borrowings Profile (I/II)

    Diversified Borrowings Profile (I/II) Borrowing mix by instrument type (₹Cr) * 62,047 * 63,730 * 63,197 * 62,309 * 65,806 7% 4% 5% 7% 7% 2% 3% 2% 2% 2% 6% 7% 6% 6% 5% 6% 6% 6% 7% 7% 2% 3% 3% 2% 2% 13% 14% 14% 15% 14% 57% 55% 58% 55% 57% 7% 7% 6% 7% 6% Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Tier II Capit

66. Slide 66: Diversified Borrowings Profile (I/II)

    Diversified Borrowings Profile (I/II) Borrowing mix by investor type (₹Cr) * 62,047 * 63,730 * 63,197 * 62,309 * 65,806 6% 7% 6% 6% 5% 2% 2% 2% 4% 2% 3% 1% 2% 2% 2% 6% 6% 6% 6% 7% 65% 66% 63% 66% 67% 1% 3% 1% 1% 4% 1% 4% 4% 4% 4% 10% 9% 8% 11% 11% 3% 2% 3% 2% 3% Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Tr

67. Slide 67: ALM Statement as of 31st Dec 2021 (As per IND AS)

    ALM Statement as of 31st Dec 2021 (As per IND AS) (₹Cr) ALM snapshot as on 31st Dec 2021 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 2,440.64 175.00 1,137.59 1,012.45 53.60 232.71 194.28 1,071.22 6,317.49 Advances 2,177.95 2,002.60 1,6

68. Slide 68: Subsidiaries

    Subsidiaries 66

69. Slide 69: Subsidiaries – Q3FY22

    Subsidiaries – Q3FY22 •CHFL recorded a gross income of Rs. 17.69 crores in Q3FY22 as •During the quarter CSEC focused on the three distinct business compared to Rs. 9.01 crores in Q3FY21 and PBT of Rs.3.90 crores lines for enhancing revenues and productivity - broking, wealth as compared to Rs. 0.66

70. Slide 70: Environmental Social Governance

    Environmental Social Governance 68

71. Slide 71: Environmental, Social & Governance (ESG) at Chola

    Environmental, Social & Governance (ESG) at Chola Corporate Access to Finance Governance ESG based Privacy & Data lending Security Innovation Digitization Employee Wellness Carbon Learning & Development Waste Diversity & Inclusion Green Building Empowering Communities 69

72. Slide 72: Responsible Products

    G Responsible Products Access to Our products focus on first time borrowers (FTB) and new to credit customers (NTCC) ensuring financial inclusion of sections of society including micro business owners Finance Vehicle Financing Loan against Property Focus on transport entrepreneurs, first time borrow

73. Slide 73: Improving Efficiency

    G Improving Efficiency Digitization Effective Governance Corporate Governance Privacy & Data Security Policies and process in place to enable Policy review at board level on periodic basis; Digitization highest standards in governance and Training on data security and privacy transparency; ethical b

74. Slide 74: People Power

    People Power S Employee Wellness Diversity & Inclusiveness  Emotional & mental wellbeing programs: Utilized by several employees in the past  Business activities such as hiring, year promotion, and compensation of  Dedicated grievance hotline employees, conducted without regard to  Focus on Stre

75. Slide 75: Environmental Consciousness

    E Environmental Consciousness Green Building Waste Carbon We aim at incorporating green methods With a clear focus on sustainability, As an environmentally responsible in the construction of our upcoming Chola has a well defined e-waste company Chola has taken various office buildings. The latest of

76. Slide 76: ESG Certification – FTSE Russell

    ESG Certification – FTSE Russell Our Company has been included in the FTSE4Good Index Series, created by the global index and data provider FTSE Russell. The FTSE4Good Index Series is designed to measure the performance of companies demonstrating strong Environmental, Social and Governance (ESG) pra

77. Slide 77: Risk Management

    Risk Management 75

78. Slide 78: Risk Governance Structure

    Risk Governance Structure  Oversee the entire risk Board of Directors management process  Formed in 2007-08 Risk Management  Meet four times in a year Committee  Periodic review of framework, process, key risk movement and other initiatives Chief Risk Officer  Establish framework, tools & techn

79. Slide 79: Key Functions of Risk Management Division

    Key Functions of Risk Management Division • Identify key risks in each function/business • Assess the risks in terms of probability of occurrence and their impact • Identify mitigation/ risk controls put in place by respective process champions • Identify key risk indicators to measure and monitor r

80. Slide 80: ERM as Value Centre in Business Processes

    ERM as Value Centre in Business Processes • ERM works with business teams on the overall customer life cycle management Active portfolio Identifying segments & management and channels risk profiles prioritization for collection efforts Underwriting models to Customer retention optimally onboard risk

81. Slide 81: ERM as Value Centre in Corporate Processes

    ERM as Value Centre in Corporate Processes • Periodic engagement with internal audit team to incorporate key observations on process failures identified by IA team which will be considered as part of risk review process. ERM also gives risk based inputs to internal audit team to plan and prioritize

82. Slide 82: Information Technology

    Information Technology 80

83. Slide 83: Technology Updates

    Technology Updates Technology Infrastructure Digital Engagement & Application Platform Provide resilient & scalable environment Deliver seamless digital experience for all  Drive enhanced usage of hybrid cloud solutions and adopt  Launch of digital solution for new personal loans and business clou

84. Slide 84: ECL Methodology

    a murugappa ECL Methodology 82

85. Slide 85: Changes to ECL Methodology

    Changes to ECL Methodology • RBI had made changes to the method of evaluating the NPAs as per their circular dated 12th Nov 2021. • While these changes are regarding evaluation of NPA as per Income Recognition and Asset Classification and Provisioning (IRACP) as defined by RBI and has no bearing dir

86. Slide 86: Asset Classification

    Asset Classification Stage 1 - On initial recognition, all loans are classified as Stage 1. Subsequently, loans which are not more than 30 DPD on the reporting date are classified as Stage 1. It also includes loans which have been reclassified from Stage 2 or Stage 3 on improvement in credit quality

87. Slide 87: Measurement Framework

    Measurement Framework Asset ECL classification PD 12 m  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

88. Slide 88: Measurement Framework

    Measurement Framework Asset ECL Description classification PD  12 m •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 with

89. Slide 89: 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 Loan Against Property Others Loan MLCV/2W/3W LAP Tamil HCV New LCV New LAP Delhi New Nadu LAP Punjab / OLDER CAR/MUV New USED Haryana

90. Slide 90: 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

91. Slide 91: 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

92. Slide 92: Thank You

    Chola ie Enter a better life murugappa THANK YOU Cholamandalam Investment and Finance Company Limited

Cholamandalam Investment and Finance Company — Q3 FY2022 Earnings Presentation on 6ix