Hinduja Global Solutions Limited · NSE:HGS
Hinduja Global Solutions — Emkay Global Investor Conference 2021
55 slides from Hinduja Global Solutions's conference presentation, Feb 18, 2021
Slide 1: Exchange filing cover letter for Emkay conference presentation
February 18, 2021 BSE Limited National Stock Exchange of India Ltd. Corporate Relation Dept. “Exchange Plaza P. J. Towers, Dalal Street Bandra Kurla Complex, Bandra (East) Mumbai - 400 001 Mumbai - 400 051 Scrip Code : 532859 Symbol : HGS Dear Sirs, Sub: Investor Conference - February 18, 2021 This
Slide 2: Emkay Investor Conference
EMKAY INVESTOR CONFERENCE th February 18 2021 | 1
Slide 3: Disclaimer
Disclaimer Certain statements in this presentation concerning our future growth prospects are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties
Slide 4: Quick Overview
CHGS Quick Overview
Slide 5: About the Company
About the Company HISTORY ▪ Part of the Hinduja Group, in the BPM business since 2000 ▪ HGS is in the business of inbound Voice & Non Voice (Transaction processing+ Digital) ▪ Over 55% of revenues from Healthcare , balance from Telecom & Media, Consumer, BFS ▪ Miniscule exposure travel and hospitali
Slide 6: Financial Overview
CHGS Financial Overview
Slide 7: Q3 FY21 Revenue Growth
Q3 FY 21 Revenue Growth Revenue Growth of 9.1% : Forex Impact 2.9%, Organic Growth 11.5% , Inorganic De-Growth (5.3)% Revenue Growth of 15.2% : Forex Impact 3.1%, Organic Growth 12.1% In Rs Mn 3.1% 12.1% (5.3%) 14,568 13,358 12,648 Q3 FY 20 India Q3 FY 20 Organic Growth FX Impact Q3 FY 21 (Reported)
Slide 8: YTD Dec FY21 Revenue Growth
YTD Dec FY 21 Revenue Growth Revenue Growth of 2.8% : Forex Impact 5.0%, Organic Growth 5.5% , Inorganic De-Growth (5.5)%, Pass through (2.1)% Revenue Growth of 11.3% : Forex Impact 5.2%, Organic Growth 6.1% In Rs Mn 5.4% (5.5% 5.9% 40,253 39,168 (2.1%) 36,166 YTD Dec FY 20 India Pass Through YTD De
Slide 9: HGS Performance: Q3 FY2020 vs Q3 FY2021
HGS Performance: Q3 FY 2020 vs Q3 FY 2021 In INR (Mn) In INR (Mn) In INR (Mn) In INR (Mn) ₹ ₹ 752 ₹ 2,063 ₹ ₹ 14,568 ₹ 1,935 ₹ 1,105 ₹ 712 12,648 1,042 Q3 FY 20 Q3 FY 21 Q3 FY 20 Q3 FY 21 Q3 FY 20 Q3 FY 21 Q3 FY 20 Q3 FY 21 REVENUES* EBITDA* PBT PAT * Adj for India Domestic CRM Business HGS Performa
Slide 10: Free Cash Flow to EBITDA Conversion
Free Cash Flow to EBITDA Conversion: CAPEX (in INR Mn) DSO (In Days) 1,327 1,940 1,176 1,167 75 83 69 77 FY 18 FY 19 FY 20 YTD Dec FY 21 FY 18 FY 19 FY 20 YTD Dec FY 21 Fig. in INR Mn EBITDA FCF/EBITDA (%) 60% 47% 44% 2% 4,061 4,411 7,165 5,392 FY 18 FY 19 FY 20 YTD Dec FY 21 | 9
Slide 11: Debt & Cash Details
Debt & Cash Details Fig in INR Mn Gross Bank Debt Cash & Cash Equivalent Net Bank Debt/(Cash) 2,678 734 167 -467 5,854 5,687 5,911 3,232 6,042 5,308 4,944 5,411 FY 18 FY 19 FY 20 YTD Dec FY 21 | 10
Slide 12: Debt of Rs 4,944 mn: 41% are Term Loans
Debt of Rs 4,944 mn: 41 % are Term Loans Consolidated Debt description by Type Total MCLR Linked loans, 4% Consolidated Debt description by Categories Total Fixed Interest Loans, 12% Total Term External Commercial Loan Loans, 17% (Fixed interest rate), 24% Total USD LIBOR Linked loans, 54% Total ECB
Slide 13: Forward Cover
Forward Cover Forward Cover: USD-INR Forward Cover (In USD) FC Rate 84.30 81.12 77.26 73.85 101.0 82.5 45.5 12.0 FY 21 FY 22 FY 23 FY 24 | 12
Slide 14: Summary Financial Profile – As at 31st December 2020
Summary Financial Profile – As at 31st December 2020 HGSL Particulars Rs. USD Net Worth (in millions) 19,978 273.6 ➢ P/E calculated as per CMP of Rs 1,146 (17th Feb 2021) Book value per share 957 13.1 ➢ USD/INR exchange rate of 73.01 Price per share 1,165.0 16.0 ➢ Total Debt includes foreign currenc
Slide 15: Peer Analysis
CHGS Peer Analysis
Slide 16: Peer Analysis
Peer Analysis Revenue EBITDA PAT In USD Mn YoY YoY YoY QE Dec 2019 QE Dec 2020 Growth % QE Dec 2019 QE Dec 2020 Growth % QE Dec 2019 QE Dec 2020 Growth % 940.7 950.6 1.0% 123.3 153.5 24.5% 82.2 75.0 -8.8% 239.2 238.4 -0.3% 42.7 60.4 41.5% 30.9 31.0 0.4% 147.6 184.8 25.2% 23.4 28.5 22.0% 12.5 16.4 30
Slide 17: HGS Service Offerings
CHGS HGS Service Offerings
Slide 18: HGS Core Capabilities
HGS Core Capabilities Analytics Customer Experience Customer Marketing Digital Enablement Assessment Experience and Digital Strategy Enablement Customer Experience Services Services Social Media Strategy Engagement Digital Experience Digital Marketing Strategy Customer Interaction Transformation Voi
Slide 19: The Global BPM Market
The Global BPM Market… Global BPM Spending ($Bn) Traditional BPM market dominates the BPM market Global BPM Services Forecast ($Bn) 188.5 197.3 206.7 161.2 172.2 180.1 62.0 46.9 2017 2018 2019 2020 2021 2022 144.7 125.2 Source: Gartner Service line Forecast 2018 Q1 2018 2022 Traditional BPO BPaaS |
Slide 20: Healthcare Practice Overview
Healthcare Practice Overview | 19
Slide 21: HGS Healthcare Journey
HGS Healthcare Journey Population Health Provider 2% 35+ 9% Clients By Revenue(1) Payer 89% Integrated Voice 50% & Omnichannel By Revenue(2) Transaction Services 50% Services USA Colombia 24,000+ Employees(3) Jamaica 9% 1% 9% India across 34 Locations(4) By Headcount(3) 47% in 5 countries Philippine
Slide 22: Creating a Deep Impact in the Healthcare Ecosystem
Creating a Deep Impact in the Healthcare Ecosystem ~5mn Patients experienced Help ~30mn members stay healthy improved access to healthcare as HGS and reduce their Healthcare Cost processes their Prior-Authorizations Talent Pool of nurses can staff a Process over 150mn manual claims annually valued o
Slide 23: HGS Healthcare Helping Clients Change the Game with New Age Metrics
HGS Healthcare is Helping its Clients to Change the Game with New Age Metrics | 22
Slide 24: HGS Healthcare Recognized as a Leading Partner
HGS Healthcare Recognized as a Leading Partner for Healthcare Solutions The prestigious NCQA Accreditation for Ranked as Top 10 performer in 2019 in building HGS positioned as Leader across Healthcare Major Contender, Rising Star in Healthcare Population Health and Disease Management collabo
Slide 25: HGS Healthcare Journey
HGS Healthcare Journey 2015-2018 = Digital and Technology Capabilities 2021 PI 2008 itd 2008 zor = Acquisition of Colibrium (2015) Bciiorurs Creation of a "0 uct ull > or a ‘oon = RPA in Transaction Services Healthcare nrolmeni ayment Integrity = Financial Recovery Analytics Focused Business Geo Exp
Slide 26: US Healthcare is a US$3.5tn Market Expected to Grow at ~6%
US Healthcare is a US$3.5tn Market Expected to Grow at ~6%... The US health spending is projected to grow c. 5.5% p.a. over the next few years US Health Expenditure (US$tn) Ageing population with ~21% of population above 64 6.0 1 by 2035 2.3 3.5 2 Increase in the cases of chronic illnesses Expected
Slide 27: Healthcare Outsourcing Can Help Address Critical Requirements
Healthcare Outsourcing Can Help Address Critical Requirements Potential Outsourcing Led Critical Requirements Outsourcing Needs Benefits Take over transaction services Payer functions Accuracy Increase membership and renewal Stringent data security Manage provider network Scalable Delivery Model
Slide 28: HGS Healthcare – Services Portfolio Evolution
HGS Healthcare – Services Portfolio Evolution… Over 450+ Lines of Businesses (LoB) carried out in 2020 for HGS Healthcare clients across payer and provider value chain highlighting complexity and scale built over time… 439 28 256 5 17 114 – 122 – 350 20 – 59 – 214 – 12 Payer 102 Provider – Populatio
Slide 29: The Healthcare Outsourcing Space is Ready for Digital Disruption
The Healthcare Outsourcing Space is Ready for Digital Disruption Key Disruption Drivers Market Drivers Technology Drivers Regulatory Drivers Cost Shift to Automation Analytics Vertical Integration – Payer – Provider Alpha Value AI/ML Payer – Provider – Interoperability PBM Customer Growth in Wearabl
Slide 30: US Healthcare – the Fastest Growing BPO Sector
US Healthcare – the Fastest Growing BPO Sector Healthcare provides a large opportunity supported by attractive tailwinds Fast Growing Healthcare BPO Segments Drivers are providers being under severe financial pressure and lack Drivers are increasing regulation, the use of coded healthcare of resourc
Slide 31: HGS Healthcare is Present across the US Healthcare Ecosystem
HGS Healthcare is Present across the US Healthcare Ecosystem Scaled presence across Payers, Providers, Health Systems, Pharmacy Benefits Management amongst others US Healthcare Ecosystem Payers Health Systems Healthcare Benefits Administration Private insurance Health Systems (including Provider
Slide 32: HGS Healthcare – Recognized Healthcare Services Leader
HGS Healthcare – Recognized Healthcare Services Leader HGS Healthcare has created a Global Healthcare Practice, an Innovation Hub and bundles of capabilities that combine technology, domain expertise and business transformation Known Leader in the Payer Ecosystem Emerging Contender in the RCM Space
Slide 33: HGS Healthcare – Strategic Imperatives
HGS Healthcare – Strategic Imperatives Leverage Deep Reimagine Healthcare Experience Customer Experience Process Embedded Strategic Digital Ready Analytics, AI/ML Imperatives Talent Build Healthcare Deploy Solutions and BPM Systems Process Automation at Scale | 32
Slide 34: Further Solution Offerings on Back of Acquisitions Led Capabilities
Further Solution Offerings on Back of Acquisitions Led Capabilities Practice led Solutions Leveraging HGS Acquisitions Care Management Service Powered by analytical models and clinical Claims Adjudication and Payment Integrity competencies e.g., Ageing in Place including Services with Automation, An
Slide 35: Appreciative HGS Healthcare Customers
Appreciative HGS Healthcare Customers…. Leading Healthcare US Fortune 100 Healthcare Fortune 100 Healthcare Payer Top Healthcare Provider Company Insurance Company Thank you for your ongoing efforts to serve our HGS has done a nice job members and providers during the global There are truly challeng
Slide 36: CES - Innovating in Core Customer Service
CES - Innovating in Core Customer Service | 35
Slide 37: Offerings
Offerings E-Care Largest investment in innovation, Digi, Social, RPA, largest CAGR Bots, machine M learning a r Target existing users in Classic Care g champion-challenger sales Traditional voice, chat, email i n s Shortest sales cycle (retain or more of Brilliant at Basics NPS, KPIs, guarantees, wo
Slide 38: HGS Consumer Journey Framework Solves Client Problems
HGS Consumer Journey Framework Solves Client Problems Educate buyers to increase client revenue and improve share of buyer wallet CUSTOMER STAGES Returns/ Awareness Research Buy Use Service Retention Warranty Acquire Support Retain SOLUTION HGS Engage Buy Bill Care Repair Retain “Attract new “Increa
Slide 39: Differentiating Thought Leadership in Social Care
Differentiating Thought Leadership in Social Care “HGS has developed an industry-leading social media and employee recruitment model. The company has built a world-class talent profile for hiring the agents best suited for social media work. The profile and recruitment model are both clear competiti
Slide 40: Leader in Customer Service and BPO
Gartner named HGS as a Leader in Customer Service and BPO 2021 Magic Quadrant HGS DIGITAL HGS PULSE VOICE OF Cognitive Contact Customer Analytics CUSTOMER Center Platform Expression of Dissatisfaction
Slide 41: HGS Revenue Profile: FY16 to YTD Dec FY21
HGS Revenue Profile: FY 16 to YTD Dec FY 21 | 40
Slide 42: Channel Mix
Non voice revenues are growing , account of 37.4% of Total Revenues Channel Mix Digital CRM Transaction processing Voice CRM 73.7% 72.7% 72.7% 67.8% 63.6% 62.6% 28.1% 29.1% 23.4% 23.8% 23.8% 25.0% 7.2% 8.3% 8.3% 2.9% 3.5% 3.5% FY 16 FY 17 FY 18 FY 19 FY 20 YTD Dec FY 21 HGS Non-voice revenues have g
Slide 43: Revenue Composition
Revenue Composition Revenue by Verticals Offshore/Near-shore to Onshore Onshore Offshore/Nearshore Telecom & Technology Consumer Products Healthcare BFS Others 11.7% 9.9% 10.0% 9.5% 11.3% 11.5% 6.9% 7.3% 8.0% 8.0% 8.8% 8.1% 42.3% 46.5% 47.0% 44.3% 45.8% 51.1% 41.8% 45.9% 49.2% 52.2% 53.5% 55.5% 13.2
Slide 44: Revenue Composition
Revenue Composition Revenue by Delivery Revenue by Currency USD INR GBP CAD India Philippines USA UK Canada Jamaica Middle East 0.1% 0.2% 0.1% 4.7% 4.3% 4.9% 6.4% 12.2% 10.3% 9.9% 11.7% 11.0% 11.8% 10.5% 8.6% 6.9% 5.9% 5.6% 12.7% 10.6% 10.2% 11.7% 11.0% 11.8% 7.8% 8.6% 6.9% 5.9% 6.1% 10.5% 9.9% 25.2
Slide 45: Other Key Metrics
Other Key Metrics OPEX seats & Owned Seats Revenue & EBITDA Per Employee Owned Seats Seat for Opex Revenue Per Employee Per Quarter EBITDA Per Employee Per Quarter (INR 000s) (INR 000s) 38.3% 37.8% 39.1% 38.0% 354 50 24.0% 298 46 285 10,726 31 13,479 13,209 13,448 13,088 33,973 21,738 21,745 20,958
Slide 46: Work@Home Solution Overview
Work@Home(TM) Solution Overview | 45
Slide 47: HGS Work@Home: Coping with Covid Crisis
HGS Work@ Home : Coping with Covid Crisis 3. IT enablement 5 Overall 1. IT Assets Deployment ▪ Clients extremely . happy with HGS ▪ IT Help Desk Scaled up ▪ Over 30,000 IT assets transported to employee ▪ Better than peers and captive sites homes in 3 weeks ▪ IT tool kits provided to employees ▪ Hig
Slide 48: HGS Work@Home Journey
HGS Work@ Home Journey 5. Evolving long term Strategy 1. Launched in 2016 3. COVID Key Milestones ▪ ~50% of HGS workforce to Move to ▪ Almost all employees are working from home ▪ 1,200+ agents in North America . Work@Home, subject to Regulatory & and 200+ Shared service employees ▪ 5771 agents hire
Slide 49: Key Tenets to enable Work@Home
Key Tenets to enable Work @ Home Type of Work Technology Talent Real Estate ▪ Extent of process Standardization ▪ Digital tool penetration for ▪ Evaluate Workforce maturity Managing current Infra (Specially in coaching and engaging and Best fit for Work@Home offshore location) ▪ Automation Assessmen
Slide 50: Recruiting: Challenges and HGS Solutions
Recruiting : Challenges and HGS Solutions Challenges HGS Solutions 1 Connect with talent as Lockdown restricts ▪ Programmatic Job advertising: resource movement ▪ Partner with pioneer platform providers to source talent faster and primarily target the passive applicant with right competency using pr
Slide 51: Training: Challenges and HGS Solutions
Training : Challenges and HGS Solutions Challenges HGS Solutions ▪ Playbook for Work@Home training: • Macro level standard practices like tailored trainer profile, their selection and certification, content design, training ratios, etc. for 1 Similar Training Engagement level as in Brick & virtual t
Slide 52: Operations: Challenges and HGS Solutions
Operations : Challenges and HGS Solutions Challenges HGS Solutions ▪ Schedule Flexibility - 1 Managing team productivity and performance ▪ Developed the flexibility of Work@Home scheduling, allows agents to arrange their own schedules. ▪ Develop Virtual community: Connect amongst the virtual workfor
Slide 53: IT Infrastructure & Data Security: Challenges & HGS Solutions
IT Infrastructure & Data Security : Challenges & HGS Solutions Challenges HGS Solutions ▪ Lockdown End point: 1 Securing Work@Home devices from cybersecurity ▪ Use VDI environment to Secure data connection with 2FA implemented. threats Encrypted data security and restricted access to official device
Slide 54: Employee Enablement: Challenges & HGS Solutions
Employee Enablement: Challenges & HGS Solutions Challenges HGS Solutions ▪ Enabling guidelines and Policies: Work@Home power & connectivity • Ergonomics 1 • InfoSec • Connectivity tools – dongles. hotspots … • Tech Assets repair 2 Work@Home Health & Wellness ▪ Employee Assistance Program: HGS provid
Slide 55: Thank You
CHGS Thank You
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