Iifl Finance Limited · NSE:IIFL
Iifl Finance — FY2022 Earnings Presentation
48 slides from Iifl Finance's earnings presentation, Apr 28, 2022
Slide 1: IIFL Finance cover letter to exchanges
IIFL FINANCE April 28, 2022 The Manager, The Manager, Listing Department, Listing Department, BSE Limited, The National Stock Exchange of India Ltd., Phiroze Jeejeebhoy Tower, Exchange Plaza, 5th Floor, Plot C/1, G Block, Dalai Street, Bandra - Kuria Complex, Bandra (E), Mumbai 400 001. Mumbai 400 0
Slide 2: IIFL Finance FY22 profits at Rs.1,188 crores, up 56% y-o-y
IIFL Finance Limited Press Release For immediate publication Mumbai, India April 28, 2022 IIFL Finance Results update IIFL Finance FY22 profits at Rs.1,188 crores, up 56% y-o-y, and Q4FY22 profits at Rs. 321 crores, up 30% y-o-y Highlights of performance Healthy rise in net profit for FY22 at Rs 1,1
Slide 3: Consolidated Results Quarterly – Q4FY22
IIFL Finance Limited Consolidated Results Quarterly – Q4FY22 Quarter Quarter Quarter ended ended ended Rs Crore Y-O-Y Q-O-Q March 31, March 31, December 31, 2022 2021 2021 Total Income (Net)* 1,138.4 904.3 26% 1,032.0 10% Pre-provision operating profit* 670.0 586.7 14% 611.3 10% Profit before tax 41
Slide 4: Business segment review
Business segment review Home Loans: At the end of the quarter, retail home loan assets grew by 23% y-o-y and 7% q-o- q to Rs 17,727 Cr. The primary focus in this segment is on affordable and non-metro housing loans. Over 55,700 customers were benefitted with a subsidy of more than Rs 1,300 Cr under
Slide 5: About IIFL
About IIFL IIFL Group is one of the leading players in the Indian financial services space. Prior to the Composite Scheme of Arrangement (effective May 2019), IIFL Finance Limited (Erstwhile “IIFL Holdings Limited”) (Bloomberg Code: IIFL IN, NSE: IIFL, BSE: IIFL) was engaged in the business of finan
Slide 6: Performance review
Performance review Quarter and year ended March 31, 2022 (Q4FY22 & FY22) Bloomberg: IIFL IN IIFL Finance Limited April 28, 2022
Slide 7: Highlights of financial performance Q4FY22 & FY22
Highlights of financial performance Q4FY22 & FY22 3-10 Business model, environment & strategy 12-15 Quarterly trends 17-24 Business segments review 26-30 Bank partnerships and digital updates 32-34 Corporate and miscellany 36-42 2
Slide 8: Key highlights of FY22 and Q4FY22 performance
Key highlights of FY22 and Q4FY22 performance FY22 PAT 1,188 Crore (up 56% yoy); RoE at 20.6% Loan AUM: ₹51,210 Cr Phygital (physical + digital) strategy to the fore Physical network in FY22 grew by over 40%, with 731 new branches & 8500 more people, ROE: 20.6% causing QoQ operating cost rise of ~₹5
Slide 9: Q4FY22 and full year FY22 Results (Consolidated)
Q4FY22 and full year FY22 Results (Consolidated) FY22 net profit up 56% yoy, income up 23% yoy Cr Q4FY22 Q4FY21 Y-o-Y Q3FY22 Q-o-Q FY22 FY21 Y-o-Y Interest income 1,423.4 1,264.4 13% 1,412.0 1% 5,422.7 4,719.2 15% Interest expense (773.2) (680.6) 14% (772.8) 0% (2,991.0) (2,608.3) 15% Net interest i
Slide 10: Income Analysis (Consolidated)
Income Analysis (Consolidated) Non fund income covers almost entire operating cost Cr Q4FY22 Q4FY21 Y-o-Y Q3FY22 Q-o-Q FY22 FY21 Y-o-Y Loan book using risk capital 31,670 29,784 6% 30,379 4% 31,670 29,784 6% Securitized book 2,397 3,829 (37%) 3,191 (25%) 2,397 3,829 (37%) Loan Book (Ind AS Balance s
Slide 11: Consolidated Balance Sheet as at March 31, 2022
Consolidated Balance Sheet as at March 31, 2022 Net Worth at 6,470 Cr ASSETS ₹ Cr LIABILITIES AND EQUITY ₹ Cr 1 Financial Assets 1 Financial Liabilities (a) Cash and Bank Balances 8,157 (a) Payables 152 (b) Receivables 199 (b) Borrowings (c) Loan Assets 33,693 - NCDs 10,407 (d) Investments 1,192 - O
Slide 12: Key Ratios for FY22 and Q4 FY22
Key Ratios for FY22 and Q4 FY22 Income, return, asset & leverage ratios Particulars Q4FY22 Q4FY21 Q3FY22 FY22 FY21 NIM on On-book Assets 7.7% 7.2% 7.3% 7.0% 6.9% Non Fund based income/ Total Income 42.9% 35.4% 38.1% 38.3% 33.8% Cost-to-income 40.9% 32.8% 39.3% 39.6% 35.4% Operating Expenses/ Average
Slide 13: Long term financial trends for the last 6 years
Long term financial trends for the last 6 years Robust financial performance and growth Loan AUM (₹ Cr) Profit after tax (PAT) (₹ Cr) RoA and RoE (%) Off Book (assignment, securitisation & colending) RoA RoE On Book 1,188 20.6% 51,210 44,688 17.9% 37,951 15.2% 15.3% 34,904 712 761 13.3% 31,228 11.3%
Slide 14: Long term asset quality trends for the last 6 years
Long term asset quality trends for the last 6 years GNPA maintained at best in industry level through cycles Additional impact on GNPA of RBI circular GNPA as computed prior to RBI circular dated dated 12th Nov’21 12th Nov’21 Gross NPA (%) Net NPA (%) 3.15% 0.85% 1.83% 2.04% 1.98% 2.30% 1.76% 1.62%
Slide 15: Return on asset and return on equity table
Return on asset and return on equity table High financial efficiency resulting into consistent improvement in RoA and RoE Focus on improving RoA and RoE by improving NIM, optimising cost via operational efficiency + digitisation & maintaining best in class asset quality RoA Tree on Avg AUM FY20 FY21
Slide 16: Business model, environment & strategy
Highlights of financial performance Q4FY22 & FY22 3-10 Business model, environment & strategy 12-15 Quarterly trends 17-24 Business segments review 26-30 Bank partnerships and digital updates 32-34 Corporate and miscellany 36-42 11
Slide 17: Our business model focuses predominantly on small retail loans
Our business model focuses predominantly on small retail loans Backed by mortgages, gold or cash-flow to customers under-served by banks Home Loan Gold Loan Business Loan Microfinance Catering to low/ middle Short term loans for Credit to MSMEs backed Self employed, low income customers in MSME work
Slide 18: Opportunity to grow in market under-served by banks
Opportunity to grow in market under-served by banks Total addressable market is many times larger than currently tapped 12.3 trillion is the overall gold Overall credit gap in the MSME sector is loan market in India. Only 35% of the ~ 20-25 trillion according to a RBI gold loan lending in India is d
Slide 19: New RBI regulatory changes will bolster microfinance industry
New RBI regulatory changes will bolster microfinance industry Removing cap on interest rate and other relaxations will help balance sheet Qualifying Asset: 75% Income Criteria: Up to Cashflow Analysis • Microfinance companies can 3 lakh • Since cashflow analysis of customer now increase their secure
Slide 20: We are uniquely placed to dominate non banking retail lending
We are uniquely placed to dominate non banking retail lending Our business is built on Phygital and Partnership model Retail Lending Strong collateral or cash flow backed loans, in segments with robust growth potential Phygital Partnerships Physical Digital Banks Fintechs Network of 3,200+ Innovativ
Slide 21: Quarterly trends
Highlights of financial performance Q4FY22 & FY22 3-10 Business model, environment & strategy 12-15 Quarterly trends 17-24 Business segments review 26-30 Bank partnerships and digital updates 32-34 Corporate and miscellany 36-42 16
Slide 22: Quarterly trends - Collection efficiency
Quarterly trends - Collection efficiency1 Collection efficiency back to pre-covid levels Gold Loan Home Loan 118% 101% 101% 100% 99% 97% 99% 101% 101% 94% Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 Business Loans Microfinance 106% 94% 98% 94% 96% 98% 88% 97% 84% 84% Q4FY21
Slide 23: Detailed breakup of provisions as at March 31, 2022
Detailed breakup of provisions as at March 31, 2022 Provision coverage levels are significantly higher than RBI requirements ₹ Cr 0-30 dpd 31-90 dpd 90+ dpd Provision % Provision Stage 3 Stage 3 Loan book Total As per As per Normal Including Normal Including Stage 1 Stage 2 Stage 1 Stage 2 RBI ECL S
Slide 24: Restructuring and ECL provision reconciliation
Restructuring and ECL provision reconciliation as at March 31, 2022 ₹ Cr ECL Provision Movement: Loan Loss Provisions Opening Addition Release Closing Provision Business Provision (B) (C) (A+B-C) (A) Home Loans 254 23 7 270 Business Loans 384 52 34 402 Gold Loans 87 8 16 78 Microfinance 285 11 43 25
Slide 25: Quarterly trends - Fund raising
Quarterly trends - Fund raising Term Loan Bonds Refinance Term Loan Bonds Refinance ₹ Cr 5,954 15,792 2,894 1,464 4,299 3,889 10,283 3,514 3,717 1,032 1,110 1,202 908 918 2,433 893 1,822 320 3,458 9,384 2,981 2,799 671 2,296 6,648 831 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 FY21 FY22 Bought back US$50 mi
Slide 26: Well diversified sources of funding
Well diversified sources of funding Resource profile is well diversified, with increasing share of bank loans Outstanding borrowing (₹ Cr) Bonds/NCDs investors split (%) 15,395 17,982 24,539 26,141 25,734 28,426 33,340 Public, Others, 23% 20% CBLO Foreign Bank, 16% 8% 10% Refinance 8% Investor, 16%
Slide 27: Asset Liability Match (ALM)
Asset Liability Match (ALM) Surplus across all buckets Cr Surplus/ (Deficit) as a % of outflow (cumulative) 3018% 231% 182% 171% 150% 49% 25% 21% 0% 47,913 41,541 47,913 36,718 34,247 24,646 29,400 19,875 15,500 16,506 12,539 10,024 7,519 7,936 3,024 4,441 5,723 241 Up 14 days 1 month 2 months 3 mon
Slide 28: Debt Repayment Schedule
Debt Repayment Schedule Well covered ₹ Cr 10,217 Cash + undrawn lines = 9,499 Cr 9,164 Cash & Cash equivalents as on March 31, 2022 8,157 8,768 Earmarked cash & cash equivalents (1,078) 8,073 Free cash & cash equivalents 7,079 Interest Liquid investments / Unutilised CC (+) 586 7,622 6,688 Undrawn c
Slide 29: Quarterly trends - Loan disbursements
Quarterly trends - Loan disbursements Disbursements have surpassed pre-Covid levels ₹ Cr Gold Loan Home Loan 7,997 2,132 6,462 1,780 4,909 5,025 5,115 1,596 1,591 1,318 3,718 987 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 Business Loans Microfinance 1,385 2,5
Slide 30: Business segments review
Highlights of financial performance Q4FY22 & FY22 3-10 Business model, environment & strategy 12-15 Quarterly trends 17-24 Business segments review 26-30 Bank partnerships and digital updates 32-34 Corporate and miscellany 36-42 25
Slide 31: Home loans – product and financial overview
Home loans – product and financial overview Small loans for affordable homes, in small towns and suburbs of metros Asset Under Management (₹ in Cr) Primary focus on affordable and non-metro customers. 17,727 86% of home loans under PSL category. 14,439 Focus is on first time home buyers. 12,19
Slide 32: Business loans – product and financial overview
Business loans – product and financial overview Focus on small ticket MSME loans Asset Under Management (₹ in Cr) For business loans backed by cash flows 8,117 7,805 7,361 7,464 7,559 Focus on balancing prudent credit underwriting with 6,000 instant in-principle decision and automated disburseme
Slide 33: Gold loans – product and financial overview
Gold loans – product and financial overview Secured low-risk short term loans Asset Under Management (₹ in Cr) Branches in more than 1,260 towns/ cities 16,228 On-boarding LTV ~70% 13,149 In-house loan origination tablet application 9,125 equipped to screen customers for earlier 6,195 defaults
Slide 34: Microfinance loans – product and financial overview
Microfinance loans – product and financial overview Focus on self employed, low income women groups for micro business Asset Under Management (₹ in Cr) Small-ticket loans for purpose of income generation activities 6,155 4,738 Target segment is rural and semi-urban self- employed women in joint
Slide 35: Construction Real Estate (CRE) & Capital Market
Construction Real Estate (CRE) & Capital Market Not core but businesses synergistic to Group’s core businesses CRE Asset Under Management (₹ in Cr) 5,055 4,727 4,355 Construction and Real Estate (CRE) 4,235 3,067 • IIFL Finance will continue to provide funding for completion of its 2,899 already fun
Slide 36: Bank partnerships and digital updates
Highlights of financial performance Q4FY22 & FY22 3-10 Business model, environment & strategy 12-15 Quarterly trends 17-24 Business segments review 26-30 Bank partnerships and digital updates 32-34 Corporate and miscellany 36-42 31
Slide 37: Our recent partnerships with banks for co-lending, co-origination
Our recent partnerships with banks for co-lending, co-origination and business correspondence.. Existing Tie-ups New Tie-ups (Q4FY22) Home Loan Gold Loan Gold Loan Business Loan Gold Loan Home Loan Home Loan and MSME LAP Home Loan and MSME LAP Home Loan Gold Loan Gold Loan Co-Lending/ Co-Origination
Slide 38: Gold loan home delivered – gaining traction
Gold loan home delivered – gaining traction Loan Journey 1. 2. • Gold loan at customer’s doorstep initiative targets branchless expansion of Gold Loan business. Customer applies for Executive visits • The initiative started a year ago, saw significant Gold Loan via app, call customer’s doorstep to t
Slide 39: Our Digital DIY channels
Our Digital DIY channels.. Digital DIY Disbursements ( Cr) My Money app and website: 265.4 a. 100% online loan application process. b. Loans ranging from 50,000 to 10 lakhs for Business Loans and from 5,000 to ₹2 lakhs for Personal Loans WhatsApp loans: a. Ease of chat has been brought to the comple
Slide 40: Corporate and miscellany
Highlights of financial performance Q4FY22 & FY22 3-10 Business model, environment & strategy 12-15 Quarterly trends 17-24 Business segments review 26-30 Bank partnerships and digital updates 32-34 Corporate and miscellany 36-42 35
Slide 41: Distinguished Board of Directors
Distinguished Board of Directors IIFL Finance – Board of Directors Nirmal Jain R Venkataraman A K Purwar Managing Director Joint Managing Director Chairman and Independent MBA, IIM Ahmedabad; MBA, IIM Bangalore; Director Rank holder CA & Cost accountant B-Tech, IIT Kharagpur M Com., Allahabad Univer
Slide 42: Experienced senior management team
Experienced senior management team IIFL Finance IIFL Home Finance IIFL Samasta N Venkatesh Rajesh Rajak Monu Ratra Chief Executive Officer Chief Financial Officer Chief Executive Officer Strategic leadership Chartered Accountant Qualified architect and MBA Program in microfinance at Harvard SVP- hea
Slide 43: Environment, Social & Governance (ESG)
Environment, Social & Governance (ESG) Supporting a sustainable economy through focus on environment.. Adopting environmentally conscious solutions in our business initiatives as well Pioneered Green Building concept in IIFL has signed a US$ 68 million partnership with housing developers loan with A
Slide 44: Promoting financial inclusion
Promoting financial inclusion IIFL is firmly committed to support economic activity and financial inclusion through its loan offerings while adapting to changes in the external environment. 64% of gold loan are of less than ₹ 72% of the Unsecured MSME loans 50,000 value given are of less than ₹
Slide 45: ESG: CSR projects continue amid covid with creative use of technology
ESG: CSR projects continue amid covid with creative use of technology Seva Kutirs (Madhya Pradesh) Education for the under privileged (Maharashtra) Because of COVID-19 pandemic government Since 2018, IIFL Foundation has been schools remained shut which led to supporting education of the children fro
Slide 46: Governance
Governance conducting our business with integrity Establishing vision, mission and values and determining, reviewing the goals and policies of the Company from time to time Promote sound corporate governance Corporate policies and guidelines: Board Diversity practices, ethical standards, and complia
Slide 47: IIFL's brand and credibility recognized at various forums
IIFL’s brand and credibility recognized at various forums IIFL Finance received ‘The Most Preferred IIFL Finance’s ‘Gold Loan at Home’ product IIFL Finance’s ‘WhatsApp Loan’ product Brand’ Award for Sustained Brilliance in received ‘Customer Services Excellence received ‘Best Use of Mobile Technolog
Slide 48: Thank you
Thank you Published in April 2022 IIFL Finance Ltd. All rights reserved. Regd. Off: IIFL House, Sun Infotech Park, Road No. 16V, Plot No.B-23, Thane Industrial Area, Wagle Estate, Thane – 400604. This report is for information purposes only and does not construe to be any investment, legal or taxati