Bajaj Finserv Limited · NSE:BAJAJFINSV
Bajaj Finserv — FY2019 Earnings Presentation
36 slides from Bajaj Finserv's earnings presentation, May 16, 2019
Slide 1: Cover letter to stock exchanges: Investor Presentation Q4 FY19
~BAJAJ \liilFINSERV 16 May 2019 To To Corporate Relations Department. Corporate Listing Department. BSE Limited National Stock Exchange of India Ltd 1st Floor, New Trading Ring, Exchange Plaza, 5th Floor ... Rotunda Building, P J Tower, PlotNd.C-1, G Block, Dalal Street, Mumbai-4oo·oor-·····--· Band
Slide 2: Bajaj Finserv Limited Investor Presentation – FY19
BAJAJ FINSERV LIMITED Investor Presentation – FY19* * Financial year 2018-19
Slide 3: Bajaj Finserv – A diversified financial services group
Bajaj Finserv – A diversified financial services group 54.99% 74% 74% Bajaj Finance Limited Bajaj Allianz General Bajaj Allianz Life • Diversified business across Insurance # Insurance # consumer, payments, rural, SME, commercial & mortgages segments • Investment grade long term issuer • Among the t
Slide 4: Bajaj Finserv performance highlights
Bajaj Finserv performance highlights All Figures in Rs Million Performance Highlights of Q4 FY19 over Q4 FY18 (Ind AS) CY 129,945 8,387 31,609 44% 32% 10% PY 90,553 6,370 28,798 Total Revenue PAT* Net Worth (Consolidated) (Consolidated) (Standalone) • Bajaj Finserv remains a debt free company. Bajaj
Slide 5: Consolidated profit components
Consolidated profit components All Figures in Rs Million Consolidated profit components for Q4 FY19 (Ind AS) Intercompany adjustments Bajaj Finserv- Standalone - Others 18 Life 8,387 Insurance 28 Bajaj Finserv General - Insurance 1,081 Consolidated Bajaj Finance 793 6,467 Consolidated profit compone
Slide 6: Adoption of Ind AS Accounting standards
Adoption of Ind AS Accounting standards • Bajaj Finserv has adopted Indian Accounting Standards (Ind AS) with effect from 1st April 2018 • Figures in respect of Bajaj Finance Ltd. are as per Ind AS • Consolidated figures for Q4 FY19 & FY19 are compliant with Ind AS • Corresponding figures for FY18 (
Slide 7: Reconciliation of Consolidated profit as per Ind AS with Indian GAAP
Bajaj Finserv : Reconciliation of Consolidated profit as per Ind AS with Indian GAAP All Figures in Rs Million Particulars Q4 FY2019 Q4 FY2018 FY2019 FY2018 Net Profit after Tax as per IGAAP 7,629 6,855 33,476 27,414 Ind AS Adjustments : Increase / (decrease) Adoption of Effective Interest Rate (EIR
Slide 8: FY19 Highlights
FY19 Highlights All Figures in Rs Million Highlights of Group Companies BAJAJ FINSERV$ FY19 FY18 Growth BAJAJ FINANCE$# FY19 FY18 Growth Total Revenue 426,056 328,627 30% AUM 1,158,884 824,216 41% Net worth (Cons) 237,659 204,829 16% Total Income 185,018 127,568 45% PAT 32,190 26,503 21% PAT 39,950
Slide 9: Bajaj Finance Limited
BAIA FINSERV Bajaj Finance Limited
Slide 10: BFL – Key Strategic Differentiators
BFL – KEY STRATEGIC DIFFERENTIATORS STRATEGY • Non-bank with strategy & structure of a bank • Diversified financial services strategy seeking to optimise risk and profit to deliver a sustainable business model and deliver a superior ROE and ROA • Focused on continuous innovation to transform custome
Slide 11: Bajaj Finance's businesses
Bajaj Finance’s businesses BAJAJ FINANCE Consumer SME Commercial Rural • Largest consumer • Focused on affluent • Wholesale Lending • Unique hub-and-spoke electronics, digital SMEs with an average products covering short, model in 903 locations products & furniture annual sales of around medium and
Slide 12: Bajaj Finance – Q4 highlights
Bajaj Finance – Q4 highlights All Figures in Rs Million Performance Highlights of Q4 FY19 over Q4 FY18 (Ind AS) CY 1,125,128 53,085 11,761 42% 52% 57% PY 791,025 34,916 7,476 Book Size Total Income Profit After Tax CY 1.1% 6.2% • Borrowing mix is not excessively dependent on banks. (Mix of 34 : 51 :
Slide 13: Bajaj Finance's growth momentum continues
Bajaj Finances’ growth momentum continues All Figures in Rs Million Book Size Total Income 1,125,128 FY19 FY19 Increase of 45% 185,018 Increase of 42% 791,025 127,568 Q4 FY19 Increase of 52% 53,085 34,916 FY18 FY19 FY18 FY19 Q4 FY18 Q4 FY19 Net Interest Income FY19 118,782 Increase of 46% Q4 FY19 81
Slide 14: Strong profit growth aided by low NPA and control on Opex
Strong profit growth aided by low NPA and control on Opex All Figures in Rs Million Loss Provision and Net NPA% 16,000 15,014 2.0% 15,000 14,000 13,000 12,000 10,305 11,000 10,000 9,000 8,000 4,093 7,000 2,272 6,000 5,000 4,000 3,000 0.63% 2,000 0.43% 1,000 0 0.0% FY18 FY19 Q4 FY18 Q4 FY19 Loss Prov
Slide 15: Bajaj Allianz General Insurance
Bajaj Allianz General Insurance 14
Slide 16: BAGIC - Key Strategic Differentiators
BAGIC - Key Strategic Differentiators STRATEGY Strive for market share growth through a well-diversified product portfolio and multi-channel distribution supported by prudent underwriting DIFFERENTIATORS Strong selection of Risk & prudent Industry leading combined ratios consistently over time - BAG
Slide 17: Bajaj Allianz General – Q4 highlights
Bajaj Allianz General – Q4 highlights All Figures in Rs Million Performance Highlights of Q4 FY19 over Q4 FY18 CY 34,023 21,669 19,174 831 23% 11% 16% -55% PY 27,641 19,553 16,499 1,866 Gross Written Net Written Premium Net Earned Premium Profit After Tax Premium Ex Crop GWP was Rs. 25,513 Mn in 1
Slide 18: Combined Ratio trend: consistently below 100% for last 5 years
Combined Ratio trend : consistently below 100% for last 5 years Combined Ratios 103.9% 96.7% 99.3% 96.8% 96.7% 92.3% 93.4% FY15 FY16 FY17 FY18 FY19 Q4 FY18 Q4 FY19 • NAT-CAT impact of Kerala Floods was Rs.495 Mn. on underwriting result during FY19 • Excluding the NAT-CAT Impact of Kerala Floods the
Slide 19: Profit after tax and capital efficiency
Profit after tax and capital efficiency All Figures in Rs Million PAT PAT CAGR of 9% between FY15 – FY19 9,212 7,278 7,799 5,623 5,642 1,866 831 FY15 FY16 FY17 FY18 FY19 Q4 FY18 Q4 FY19 Total Capital infused is Rs.2,768 Mn Capital Invested & Net worth Accumulated profit* 95% of Net worth as on 31 Ma
Slide 20: BAGIC consistently amongst top private insurers in Gross Premium
BAGIC consistently amongst top 2 private insurers in terms of Gross Premium Industry GDPI Trend (Rs. Bn.) Q4 FY19 GDPI growth 13% 2,000 2,000 1,617 1,415 1,500 1,199 1,500 803 916 930 1,000 737 1,000 597 439 400 452 500 378 500 477 602 678 687 212 261 425 - 188 191 - FY15 FY16 FY17 FY18 FY19 Q4 FY18
Slide 21: BAGIC has a well balanced product mix
BAGIC has a well balanced product mix Business Mix 9% 8% 8% 7% 8% Others 13% 19% 20% 21% 25% Agri (Crop 15% Insurance) 13% 14% 14% 13% Prop, Liability, 7% 15% 9% 9% Engg 6% 8% 5% 5% 7% 6% Group Health 46% Health (Retail) 44% 44% 42% 40% Motor (Retail) FY17 FY18 FY19 Q4 FY18 Q4 FY19 Business mix is
Slide 22: BAGIC's Channel Mix: Bancassurance strengthening
BAGIC’s Channel Mix : Bancassurance strengthening Channel Mix 5% 8% 10% 12% 12% Corporate Agents - Banks 12% 9% 6% 7% 6% 19% 20% 21% 21% 20% Corporate Agents - Others 18% Individual Agents 28% 31% 23% 33% Direct Business 44% 36% 37% 32% 30% Brokers FY17 FY18 FY19 Q4 FY18 Q4 FY19 Focus on Bancassur
Slide 23: BAGIC - Virtual Points of Presence – An Industry First
BAGIC - VIRTUAL POINTS OF PRESENCE –AN INDUSTRY FIRST VSO Success Graph 10,000 7.3% 8.0% 8,000 6.0% 5.0% 6,000 3.2% 4.0% 4,000 8,135 1.4% 2.0% 2,000 4,745 0.1% 2,430 - 820 0.0% FY15 FY16 FY17 FY18 FY19 Rs Million VSO GWP VSO contribution to co GWP • Initiated in August 2014 and has grown exponential
Slide 24: Assets Under Management continue to grow
Assets Under Management continue to grow AUM(cash and investments) - Rs Billion (as of end of period) FY19 Increase of Cash generation of over Rs.24 Bn., 3x of Profit after tax during FY19 16% BAGIC 172 continues to grow its AUM 148 strongly Investments 108 are largely in 92 fixed income securities
Slide 25: Bajaj Allianz Life Insurance
Bajaj Allianz Life Insurance 24
Slide 26: BALIC – Key Strategic Differentiators
BALIC – KEY STRATEGIC DIFFERENTIATORS STRATEGY • Balance growth with balanced product mix, seeking steady increase in market share of individual business • Business construct is to balance customer benefit with shareholder returns, focusing on New Business Value DIFFERENTIATORS • Focused on retail s
Slide 27: Bajaj Allianz Life – Q4 highlights
Bajaj Allianz Life – Q4 highlights All Figures in Rs. Million Performance Highlights of Q4 FY19 over Q4 FY18 CY 6,891 11,082 14,718 32,899 45% 23% 15% 23% PY 4,742 9,002 12,760 26,700 Individual Rated NB Group NB Renewal Premium Gross Written Premium CY 1,119 566,201 804% Solvency Ratio as on -35% 3
Slide 28: Ticket size continues to increase
Ticket size continues to increase All Figures in Rs. Regular Premium Ticket Size Regular Premium Ticket Size (Agency) Q4 FY19 95,213 Q4 FY19 Increase of 42% increase of 24% FY19 FY19 Increase of 74,714 60,509 19% increase of 23% 56,128 66,839 62,858 48,877 45,449 50,165 37,066 FY17 FY18 FY19 Q4 FY18
Slide 29: Efforts to improve Persistency paying off
Efforts to improve Persistency paying off Persistency 13th Month Persistency 25th Month 68% 77% 79% 68% 58% 63% 51% 51% Persistency - 13th Month Persistency - 25th Month FY16 FY17 FY18 FY19 FY16 FY17 FY18 FY19 Persistency 37th Month Persistency 49th Month 53% 47% 49% 42% 44% 37% 38% 42% Persistency
Slide 30: BALIC's Individual Rated premiums growing across all major channels
BALIC’s Individual Rated premiums growing across all major channels All Figures in Rs Million Individual Rated NB Individual Rated NB Agency FY19 Increase FY19 Increase of 25% of 9% Q4 FY19 increase 17,420 Q4 FY19 increase of 27% of 45% 13,972 12,039 11,065 10,101 8,476 6,891 4,742 4,528 3,558 FY17
Slide 31: Balanced product mix
Balanced product mix Individual Rated Mix (Annual) Share of Non-ULIP business in Individual Rated Mix (Quarterly) individual business increasing 5% 4% 5% 10% 16% 27% 25% 24% 24% 30% 70% 72% 60% 68% 60% FY17 FY18 FY19 Q4 FY18 Q4 FY19 Individual - Unit Linked Individual - Par Individual - Non Par Indi
Slide 32: Assets Under Management
Assets Under Management AUM (Mix) • AUM growth of 8.9% for FY19 • Of the UL Funds of Rs.231 Bn., 566 520 60% is equity funds as on 31 493 436 441 Mar 2019 (61% as on 31 Mar 336 2018 out of the UL Funds of 279 306 249 230 Rs.214 Bn.) 217 219 192 214 214 FY15 FY16 FY17 FY18 FY19 Total Unit Linked Othe
Slide 33: MCEV Update
MCEV Update All Figures in Rs Million Particulars FY 18 FY 19 Annualized Premium** (ANP) 17,820 22,255 New Business Value* (NBV) 2,223 3,477 Implied Margins on ANP+ 12.47% 15.62% Embedded Value++ (EV) 118,583 129,889 • One-year forward rates derived from the risk free yield curve are used for discou
Slide 34: MCEV Movement
MCEV Movement All Figures in Rs Mn 9,540 1,232 172 1,784 2,619 3,477 1,936 129,889 118,583 As at Unwinding Investment Operational Assumption Others NBV at POS Expense As at 31st March Variance Variance Change (ILFS, Overrun 31st March 2018 (incl valn) Dividend) 2019 Increase / Decrease 1. Par Busine
Slide 35: Disclaimer
Disclaimer This presentation has been prepared by Bajaj Finserv Limited (the “Company”) solely for your information and for your use. This presentation is for information purposes only and should not be deemed to constitute or form part of any offer or invitation or inducement to sell or issue any s
Slide 36: Thank You
BAJAJ FINSERV Thank You 35