Spandana Sphoorty Financial Limited · NSE:SPANDANA
Spandana Sphoorty Financial — Investor Day (December 2023)
32 slides from Spandana Sphoorty Financial's investor day presentation, Dec 11, 2023
Slide 1: Regulation 30 disclosure letter to stock exchanges
Ref: SSFL/Stock Exchange/2023-24/124 Date: December 11, 2023 To To BSE Limited, National Stock Exchange of India Limited, Department of Corporate Services Listing Department P. J. Towers, 25th Floor, Exchange Plaza, C-1, Block G Dalal Street, Bandra Kurla Complex, Bandra (E) Mumbai – 400001 Mumbai –
Slide 2: Spandana 2.0 Analyst Day
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Slide 3: Vision 2028: ₹28,000 Crores by FY 2028
Vision 2028 ₹28,000 Crores by FY 2028
Slide 4: Key Drivers
Key Drivers 1 Distribution 2 Risk Mitigation 3 Liabilities 4 Technology 5 People Practices
Slide 5: Distribution
Distribution Core Standardizing Cultural Shift Philosophy Processes Scale-up, Productivity & Diversification Efficiency
Slide 6: Distribution - Microfinance
Distribution - Microfinance Customer Acquisition Disbursement Led Growth 7% 20% - 25% Monthly Shorter Weekly Tenures 75% - 80% 93% Core Q2FY24 FY28 (E) Philosophy Loan Tenure Muted Ticket Sizes 3% 8% 10% - 15% 20% - 25% 24 months Scale-up, Productivity 89% 18 months & Efficiency Tracking 70% - 75% 1
Slide 7: Distribution - Microfinance
Distribution - Microfinance Rural Borrowers Borrowers / Loan Officer Focus Core ~6.2* 450 - 475 Philosophy 317 JLG 2.7* 5X5X5 Scale-up, Productivity & Q2FY24 FY28 (E) Q2FY24 FY28 (E) * millions Efficiency Share of new borrowers in quarterly disbursement Improving Efficiency 30% - Standardizing 44% 3
Slide 8: Distribution - Microfinance
Distribution - Microfinance Streamlined structure for efficient operations Scale-up, Span of reporting / Productivity Focus on Case load & Efficiency JLG SVP 3 – 5 VP’s VP 3 – 5 AVP’s Standardizing Input Processes Management AVP 4 – 5 CM’s Cluster Manager 4 – 5 BM’s Supervisory Layers for Diversific
Slide 9: Distribution – LAP & Nano Enterprise
Distribution – LAP & Nano Enterprise Borrowers Standardizing 2.5L - 3.0L Loan Processes Against Property <1,500 Diversification Q2FY24 FY28 (E) AUM 3,000 - 3,500* Nano ~75x Cultural Shift Enterprise Loans 46* Q2FY24 FY28 (E) * ₹ Crore
Slide 10: Distribution
Distribution Data Driven Culture – Automated Reports on Business Parameters Data Diversification Analytics Persona Based Data Availability Cultural Shift OLTP+OLAP Automated MIS Rule-Engine Branch Selection -> Underwriting ->Disbursement -> Collection -> EWS based Credit Decisions *~1 decision every
Slide 11: Risk Management
Risk Management Microfinance is about managing risks Risk Risk Diversification Monitoring Analytics & Governance Decisioning
Slide 12: Risk Management
Risk Management AUM concentration in Top 3 States Geographic Diversification 44% <36% Top 3 states 56% Rest of India >64% Risk Exposure Q2FY24 FY28 (E) Sizing Diversification Diversifying Asset Book 10% - 15% Analytics & Product Microfinance Decisioning Diversification 100% 85% - 90% New business Q2
Slide 13: Risk Management
Risk Management Rules based ‘Go / No-Go’ credit engine deployed Risk Scoring Risk Diversification for Branch LOS Expansion Approved Rule 1 Rule 2 Rule 3 Borrower information Rejected Rules based screening Analytics & Tech for Risk Assessment & Decisioning Underwriting Scorecard based credit decision
Slide 14: Risk Management
Risk Management Enterprise level Risk Monitoring Process, Analytics & Checks & Decisioning Controls Operational Administrative Human Resource Risk Reviews & Early Warning Well defined Monitoring Signals thresholds & Finance & Accounting frequency of risk Credit monitoring Supervision Governance thro
Slide 15: Risk Management
Risk Management Risk Assessing Audit Digitization & Active Monitoring Monitoring Controls Branch Level Governance Checks Compliances
Slide 16: Liabilities
Liabilities Diversified Debt Borrowing Management Cost of Borrowing
Slide 17: Liabilities
Liabilities Borrowing mix <2% 15% - 20% 28% <=15% Banks <=10% 54 lending 21% NBFC’s Diversified partners Capital markets Borrowing 60% - 70% FPI & ECB 49% Q2FY24 FY28 (E) Cost of Borrowing Term Loan NCD / MLD Securitization Commercial Papers Direct Assignment ECB Debt Management & Gearing
Slide 18: Liabilities
Liabilities Q2FY24 Diversified Borrowing Cost of Marginal cost of borrowing 12.3% <11% Borrowing Debt Management & Gearing
Slide 19: Liabilities
Liabilities Cost of Q2FY24 Borrowing Gearing 2.3x <4.0x Debt Management & Gearing CRAR 36.6% ~25%
Slide 20: Technology
Technology Using Tech Becoming IT Infra and For Control & Future Ready Security Verification Analytics & Process Scorecard Automation Based Lending
Slide 21: Technology
Technology Cloud Based Information Security Preparedness Stable Infra Information Information Security Security Trainings Preparedness IT Infra & Cloud security Security Rigorous BCP & DR Prepared for any future disruption Network Security & firewalls Process Automation IT Governance Data Encryption
Slide 22: Technology
Technology Mobility Automation for Host to Host Solutions IT Infra and Security OCR Enabled Loan Banking KYC Management Instant credit System Journey System Process Automation Optical Character Recognition Deployment Automation For H2H Using Tech for Control & Verification Tech Partnerships Analytic
Slide 23: Technology
Technology Geo- Geo-Tagging Customer homes, Centers & Branches Tagging Geo fencing Process Automation Control Attendance Digitization Risk Mitigation Branch & Travel Allowance Customer Satisfaction Using Tech for Control & Verification Technology deployed in current operations e-Sign & e- NACH Analy
Slide 24: Technology
Technology Rule Automation & Analytics for Performance Monitoring Using Tech Engine for Control & Verification Analytics Incentive Automation Automated Reports, Data Lake & Analytics Analytics & Scorecard based Autonomous Self Learning Scorecards Lending Automating Incentives Generative AI Becoming
Slide 25: Technology
Technology Integrated Mobile based Solutions Safe Harbor Forward Looking Culture: Analytics & One Spandana, One Application, One Device Scorecard Automated based Graded Lending Pricing Rule- engine For Non-MFI Integrated Becoming CRM, IVR & CBDC- Digital Rupee Private Blockchain-KYC Self-service Fut
Slide 26: People Practices
People Practices Retaining The Journey People Agenda Ahead Talent Attracting Governance Talent
Slide 27: People Practices
People Practices 13 key positions & Senior Management Team – in place Stable Management Team Mission Deliver quality financial services for enhancing the income levels of communities in Bharat People Mission, Vision & Agenda Vision Values • To be the preferred choice for customers and employees in f
Slide 28: People Practices
People Practices Sourcing Talent Employees People ~21,000 Agenda Building the Middle 12,677 Layer Attracting Market Q2FY24 FY28 (E) Competitive Talent Salary Employee Centric Initiatives Last Mile Retaining Connect Talent PRISM Performance Review with Integral Support & Management Performance Manage
Slide 29: People Practices
People Practices Nurturing & Developing Attracting Talent Talent Celebrating Success and Performance Benefits at par with Industry Retaining Talent Employee Engagement Staff Governance Culture of Celebrating Success The Journey Ahead
Slide 30: People Practices
People Practices Fair Practice Key policies in place Statutory compliances Retaining & Talent Governance Code of conduct Shops & Establishment Act Employee referral Minimum Wages Acts Staff Equal employment & non-discrimination Bonus Act Governance Performance management system Maternity Benefit Act
Slide 31: People Practices
People Practices Satisfaction to Delight • Build Psychological safety at workplace Staff • Progressive people policy & processes Governance • Long term retention plan Inclusion & Sustainability • Embed a strong, sociable culture • Drive Diversity & Inclusion • Strengthening Governance structure The
Slide 32: Onwards to achieving 28 by 28
Onwards to achieving 28 by 28
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