Aditya Birla Capital Ltd. · NSE:ABCAPITAL
Aditya Birla Capital — Q3 FY20 Earnings Presentation
45 slides from Aditya Birla Capital's earnings presentation, Jan 31, 2020
Slide 1: Investor Presentation: Financial Results – Q3 FY20
Investor Presentation FINANCIAL RESULTS – Q3 FY20 PROTECTING INVESTING FINANCING ADVISING MUMBAI 31st January 2020 A Leading Financial Services Conglomerate Aditya Birla Capital Limited
Slide 2: Table of contents
ADITYA BIRLA Table of contents „CAPITAL adityabirlacapital.com 1 | Overview Pg. 3 - 5 2 | Business-wise Performance Pg. 6 - 40 3 | Consolidated Financials & Other Annexures Pg. 41 - 45 NOTE 1: The financials of Aditya Birla Capital Ltd are consolidated financials prepared based on Ind AS unless othe
Slide 3: Key highlights
ADITYA BIRLA Key highlights CAPITAL adityabirlacapital.com Consistent profit delivery from diversification; NBFC Q3 NIM3 expanded y-o-y by 41 bps to ✓ Consolidated ABCL Q3 PAT grew by 17% y-o-y; ✓ 5.24%; Retail loan book grew by 30% y-o-y YTD PAT grew by 27% y-o-y Ind. APE1 YTD grew by 14% y-o-y in
Slide 4: Q3 FY20: Key Financials
ADITYA BIRLA Q3 FY20: Key Financials CAPITAL adityabirlacapital.com C O N S O L I D AT E D Figures in Rs Crore Quarter 3 ∆ LY% FY 18-19 FY 19-20 Businesses (PY) (CY) 13% 17% NBFC 212 203 4,645 250 Asset Management 109 130 19% Life Insurance 38 27 4,118 214 Housing 21 27 31% General Insurance Broking
Slide 5: 9M FY20: Key Financials
ADITYA BIRLA 9M FY20: Key Financials CAPITAL adityabirlacapital.com C O N S O L I D AT E D Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Businesses (PY) (CY) 12% 27% NBFC 642 684 7% 12,906 776 Asset Management 316 395 25% Life Insurance 52 81 56% 11,520 613 Housing 43 82 90% General Insura
Slide 6: Aditya Birla Finance Limited
Aditya Birla Finance Limited PROTECTING INVESTING FINANCING ADVISING 6
Slide 7: Diversified portfolio with value accretive growth
ADITYA BIRLA Diversified portfolio with value accretive growth „CAPITAL adityabirlacapital.com Figures in Rs Crore Focus on growth in high margin segments SME + Retail + HNI ■ Large + Mid Corporate ■ Others ▪ Strong retail momentum ↑ 30% y-o-y 49,302 47,933 Loan book 2% ▪ SME secured TL/WCDL↑ 17% y-
Slide 8: Building granularity with ticket sizes reducing across segments
ADITYA BIRLA Building granularity with ticket sizes reducing across segments „CAPITAL adityabirlacapital.com SME Retail HNI + Others % Mix 26% 27% 27% % Mix 13% 16% 18% % Mix 11% 9% 10% 3% 2% 1% 2% 4% 15% ■ Broker Funding 9% Secured (BL-PL) 28% 11% 11% Treasury 39% 23% 23% 54% 51% 51% Supply Chain F
Slide 9: Selective approach in Large and Mid Corporate segment
ADITYA BIRLA Selective approach in Large and Mid Corporate segment „CAPITAL adityabirlacapital.com Figures in Rs Crore Large & Mid Corporate Portfolio Update Large & Mid Corporate Concentration Ticket Size Range # of Customer % of Total Book ➢ ~Rs 1,750 Crore run down of structured finance % Mix 50%
Slide 10: Stage-wise assets and ECL Provisioning
ADITYA BIRLA Stage-wise assets and ECL Provisioning „CAPITAL adityabirlacapital.com Figures in Rs Crore Gross Stage 3 (excl. IL&FS) at 2.26% Asset Quality Q2 FY20 Q3 FY20 Increase of 0.83% due to 3 corporate accounts ▪ All 3 exposures are secured and adequately Gross Stage 1 & 2 98.15% 97.27% collat
Slide 11: Well matched ALM with diversified borrowing mix
ADITYA BIRLA Well matched ALM with diversified borrowing mix „CAPITAL adityabirlacapital.com ALM optimised for liquidity and costs Diversification across instruments and investors Cumulative Outflows ■ Cumulative Inflows Borrowing Mix % Sourcing Mix % 100% 100% 75% 74% Term Loan 44% Bank 61% NCD 35%
Slide 12: Consistent margin expansion across quarters
ADITYA BIRLA Consistent margin expansion across quarters „CAPITAL adityabirlacapital.com Cost of borrowing dropped by 9 bps q-o-q 8.25% 8.24% 8.26% 8.24% 8.15% 7.96% 8.04% Cost of 7.84% Optimised borrowing cost in a volatile Borrowing interest rate environment Q4 FY18 Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19
Slide 13: Key Financials – Aditya Birla Finance Limited
Key Financials – Aditya Birla Finance Limited ∆ LY% Quarter 3 Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Key Performance Parameters FY 18-19 FY 19-20 (PY) (CY) (PY) (CY) 49,301 47,933 Lending book 49,301 47,933 +35 bps 11.97% 12.32% Average yield (Incl. Fee Income) 11.76% 12.46% * +69 b
Slide 14: Aditya Birla Housing Finance Limited
Aditya Birla Housing Finance Limited PROTECTING INVESTING FINANCING ADVISING 14
Slide 15: Delivery in line with stated targets
ADITYA BIRLA Delivery in line with stated targets „CAPITAL adityabirlacapital.com Figures in Rs Crore Lending book at ~Rs 12,190 Cr (Retail: 95%) 12,190 Affordable book at ~ Rs. 2,100 Crore (grew 1.8x y-o-y) 10,828 Growth in Lending Book Improvement in Cost Income Ratio y-o-y Led by scale and operat
Slide 16: Systematic approach to build a healthy portfolio mix
Systematic approach to build a healthy portfolio mix Segment Mix (%) ▪ ATS for Affordable Home Loans ~ Rs 14 Lacs Affordable Loans ▪ 28% of affordable HL portfolio backed by IMGC and 45% eligible for PMAY 7% 5% subsidy CF 23% 24% 11% LAP (Retail) ▪ ATS: Rs 56 Lacs (PY: Rs 79 Lacs) 17% Retail LAP ▪ L
Slide 17: Prudent asset liability management
ADITYA BIRLA Prudent asset liability management CAPITAL adityabirlacapital.com Optimised ALM for liquidity and cost Diversification in borrowing mix and investor profile Cumulative Outflows ■ Cumulative Inflows Borrowing Mix % Sourcing Mix % 100%100% 89% 64% Term Loan 77% Bank 83% 5% 10% 6% 12% 9% 1
Slide 18: Pan India distribution network
ADITYA BIRLA Pan India distribution network CAPITAL adityabirlacapital.com Stable Geographic Mix (%) Focus on increasing reach and building retail granularity Home Loan Book Home Loan Book (Metros) (Non-Metros) 39% 41% 21% 3,803 9% 4,557 13% 12% 4,177 3,132 19% 19% 29% 28% Q3 FY19 Q3 FY20 Q3 FY19 Q3
Slide 19: Maintaining margins through interest rate cycles
Maintaining margins through interest rate cycles Optimised borrowing cost in a volatile 8.4% 8.5% 8.4% 8.4% 8.3% interest rate environment 7.9% 8.0% Cost of Borrowing Maintained margins across interest rate Q1 FY19 Q2 FY19 Q3 FY19 Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20 cycles ■Yield ■ NIM (incl. Fees) 10.0
Slide 20: Key Financials – Aditya Birla Housing Finance Limited
Key Financials – Aditya Birla Housing Finance Limited ∆ LY% Quarter 3 Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Key Performance Parameters FY 18-19 FY 19-20 (PY) (CY) (PY) (CY) * 13% 10,828 12,190 Lending book 10,828 12,190 * 13% 10.38% 10.35% Average yield 10.05% 10.39% 7.35% 7.51% Ne
Slide 21: Aditya Birla Sun Life AMC Limited
Aditya Birla Sun Life AMC Limited PROTECTING INVESTING FINANCING ADVISING 21
Slide 22: Profitable growth aided by robust asset mix
ADITYA BIRLA Profitable growth aided by robust asset mix „CAPITAL adityabirlacapital.com Figures in Rs Crore 2,62,223 2,58,833 2,65,475 Domestic Equity AAUM1 grew by 6% y-o-y 9,925 7,712 5,860 Total Domestic AAUM grew by 3% y-o-y 1,61,121 1,55,595 1,57,688 Growth in Improvement in Equity AAUM Mix Ov
Slide 23: Maintaining profitability track record in a challenging environment
Maintaining profitability track record in a challenging environment Figures in Rs Crore 27.7 Improvement in profitability led by change 25.0 PBT margin 22.2 in asset mix towards high margin segments (bps) PBT Margin1 +3 bps +3 bps 9M FY18 9M FY19 9M FY20 Strong growth in profitability 26% CAGR 44W10
Slide 24: Continued focus on retail expansion
ADITYA BIRLA Continued focus on retail expansion CAPITAL adityabirlacapital.com Figures in Rs Crore Focus on expanding retail presence Added 53 locations to reach 310 with >75% in B-30 cities; Similar addition expected in the coming year Broad based penetration in B-30 cities with AUM1 at ~ Rs 37,43
Slide 25: Balanced Distribution Network
Balanced Distribution Network AAUM Sourcing Mix (%) Distribution Scale Digital Tech enablement i Overall Equity Customers 310 Locations ➢ Launched new investor portal with simplified UX 19% 20% Direct > 75% in B-30 cities 45% ➢ Launched micro ticket size and 1 Click SIP product 46% 22% 20% ■National
Slide 26: Key Financials – Aditya Birla Sun Life AMC Limited
Key Financials – Aditya Birla Sun Life AMC Limited ∆ LY% Quarter 3 Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Key Performance Parameters FY 18-19 FY 19-20 (PY) (CY) (PY) (CY) 2,42,344 2,49,926 Domestic AAUM 2,48,607 2,52,573 -t 6% 86,748 92,238 Domestic Equity AAUM 88,920 91,084 8,778 9
Slide 27: Aditya Birla Sun Life Insurance Limited
Aditya Birla Sun Life Insurance Limited PROTECTING INVESTING FINANCING ADVISING 27
Slide 28: Growth with significant value creation
ADITYA BIRLA Growth with significant value creation CAPITAL adityabirlacapital.com Figures in Rs Crore 39% 1,188 Individual FYP1 (YTD) grew by 14% y-o-y 1,039 Maintained market share at 4% 618 Ind. FYP1 Net VNB for Q3 FY20 grew 2x y-o-y 9M Net VNB Margin3 at 4.4% (improved ~340 bps y-o-y) 9M FY18 9M
Slide 29: Focus on value accretive product mix
ADITYA BIRLA Focus on value accretive product mix „CAPITAL adityabirlacapital.com Figures in Rs Crore Product Mix Improvement in Ind. VNB Margins1 5% 7% 6% 34.1% 35.3% Gross VNB grew 17% y-o-y Protection 428 Q3FY20 Gross VNB at 34.0% (PY: 31.2%) Gross VNB 32% 33% 43% Non-Par 366 Par 28% 23% Net VNB
Slide 30: Balanced sourcing strategy
ADITYA BIRLA Balanced sourcing strategy „CAPITAL adityabirlacapital.com Figures in Rs Crore Driving growth through partnerships and Partnership Channel Proprietary Channel operating leverage in proprietary 647 ▪ 8 Banca tie-ups incl. HDFC Bank, DCB and KVB ▪ Pan India presence across 2,750+ cities t
Slide 31: Focus on quality of business
Focus on quality of business Continuous improvement in persistency across products and cohorts Persistency 41. 41. 41. 41. 41. +6% 75% 81% +2% +0% +2% Figures in Rs Crore +4% 64% 66% 13th Month persistency at 81% (PY: 75%) Ratios1 56% 56% 52% 54% 45% 48% = 13th month 25th month 37th month 49th month
Slide 32: Key Financials – Aditya Birla Sun Life Insurance Limited
Key Financials – Aditya Birla Sun Life Insurance Limited ∆ LY% Quarter 3 Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Key Performance Parameters FY 18-19 FY 19-20 (PY) (CY) (PY) (CY) I- 8% 480 516 Individual First year Premium 1,107 1,261 * 14% 530 579 Group First year Premium 1,579 1,258
Slide 33: Aditya Birla Health Insurance Limited
Aditya Birla Health Insurance Limited PROTECTING INVESTING FINANCING ADVISING 33
Slide 34: Strong growth led by retail
ADITYA BIRLA Strong growth led by retail lg CAPITAL adityabirlacapitaLcom Figures in Rs Crore GWP grew 73% YoY with retail growth at 2x 3.2x 546 Retail GWP Mix: 71% (PY: 60%) Strong GWP 316 385 Retail growth led by 172 36 189 6.5+ million lives covered Retail 136 126 160 Group 3.8 million lives thro
Slide 35: Driving value through Scale
Driving value through Scale One of the largest 3rd party distribution capacities 9M FY19 9M FY20 Branches 59 76 Banca tie-ups: 9 banks with 12,000+ branches Banca % of retail GWP it Agents 17,100+ 25,400+ Sales force 1,450+ 2,200+ ➢ Bank growth contributing to 2.4x y-o-y 64% 56% growth in Banca GWP
Slide 36: Expanding market through customer value proposition
Expanding market through customer value proposition Large & diversified product suite enabling traditional & non-traditional customer acquisition Expanding the Market Comprehensive Product Suite Outcome2 Average age 5 years lower than industry Younger customer base (<30 years) Activ Health / Assure:
Slide 37: Higher customer engagement by leveraging our digital capabilities
Higher customer engagement by leveraging our digital capabilities Engagement through customer health journey L Know your health Improve your health Get Rewarded Active DayzTM Healthy Heart Score Health Services Wellness Services HealthReturnsTM suss. soneres ri Wellness Services 3482.75 O 3, 0 % Ret
Slide 38: Key Financials – Aditya Birla Health Insurance Limited
Key Financials – Aditya Birla Health Insurance Limited ∆ LY% Quarter 3 Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Key Performance Parameters1 FY 18-19 FY 19-20 (PY) (CY) (PY) (CY) 2.1x 81 170 Retail Premium 189 385 4 2.0x 57 60 Group Premium 126 160 * 1.7x 139 231 Gross Written Premium
Slide 39: Other Financial Services businesses
ADITYA BIRLA „CAPITAL adityabirlacapital.com Other Financial Services businesses
Slide 40: Other Financial Services Businesses
ADITYA BIRLA Other Financial Services Businesses CAPITAL adityabirlacapital.com Quarter 3 Figures in Rs Crore Nine Months FY 18-19 FY 19-20 Key Performance Parameters FY 18-19 FY 19-20 (PY) (CY) Other Financial Services Businesses1 (PY) (CY) 162 200 Aggregate Revenue 482 542 (6) 10 Aggregate Profit
Slide 41: Annexure A: Consolidated Financials
ADITYA BIRLA „CAPITAL adityabirlacapital.com Annexure A Consolidated Financials
Slide 42: Consolidated Profit & Loss
Consolidated Profit & Loss Figures in Rs Crore ∆ LY% Quarter 3 Figures in Rs Crore Nine Months ∆ LY% FY 18-19 FY 19-20 Consolidated Profit & Loss FY 18-19 FY 19-20 (PY) (CY) (PY) (CY) * 14% 3,780 300 4,326 276 Revenue Profit Before Tax (before share of profit/(loss) of JVs 10,434 813 11,947 951 * 15
Slide 43: A financial services conglomerate meeting the life time needs of its customers
ADITYA BIRLA CAPITAL adityabirlacapital.com A financial services conglomerate meeting the life time needs of its customers PROTEC INVESTING FINANCING ADVISING Life Insurance Mutual Funds Home Finance Online Personal Finance Health Insurance Wealth Management Personal Finance Management Motor Insuran
Slide 44: Disclaimer
ADITYA BIRLA Disclaimer „CAPITAL adityabirlacapital.com The information contained in this presentation is provided by Aditya Birla Capital Limited (“ABCL or the Company”), formerly known as Aditya Birla Financial Services Limited, to you solely for your reference. Any reference herein to "the Compan
Slide 45: Glossary
ADITYA BIRLA Glossary „CAPITAL adityabirlacapital.com ▪ AAUM – Quarterly Average Assets under Management ▪ GWP – Gross Written Premium ▪ Q1– April-June ▪ ALM – Asset Liability Management ▪ HL – Home Loan ▪ Q2 – July-September ▪ ANW – Adjusted Net Worth ▪ JV – Joint Ventures ▪ Q3 – October – December