Max India Ltd · NSE:MAXIND
Max India — Investor Presentation (February 2015)
56 slides from Max India's investor presentation, February 2015
Slide 1: Max India Limited Investor Presentation
Max India Limited Investor Presentation February, 2015 www.maxindia.com BSE Scrip Code: 500271, NSE Ticker: MAX, Bloomberg: MAX:IN 1
Slide 2: Max Group - Overview
MAX GROUP - OVERVIEW www.maxindia.com 2
Slide 3: Max Group Vision
Max Group Vision “To be the most admired corporate for service excellence” • Positive social impact • Culture of Service Sevabhav • Helpfulness • Mindfulness • Expertise • Entrepreneurship Excellence • Dependability • Business performance • Transparency • Respect Credibility • Integrity • Governance
Slide 4: Our Businesses
Our Businesses Multi-business corporate Focused on people and service “ IN THE BUSINESS OF LIFE ” Life Insurance Healthcare Health Insurance Senior Living Protecting Life Caring for Life Enhancing Life 100% Owned; 74:26 JV* with Mitsui Equal JV^ with Life 74:26 JV with BUPA Continuing Care Sumitomo;
Slide 5: A unique investment opportunity and a resilient business model
A unique investment opportunity and a resilient business model 1 INR 116 billion+ Revenues*… INR 120 billion MCap… 5 Mn+ Customers… 18,000 Employees… 55,000+^ Agents… 2,100+ Doctors… 2 Strong growth trajectory even in challenging times; a resilient & diversified business model 3 Steady revenue growt
Slide 6: High pedigree investor base
Growth potential recognized by the market…. high pedigree investor base Shareholding Pattern as on Dec 31, 2014 Others 10.1% • Temasek Mutual • Fidelity Funds Shareholding • Norges 12.2% Promoters • New York Life Concentrated • Jupiter 40.5% with Marquee • GIC Investors • Comgest • Reliance MF FII (
Slide 7: Consistent track record of strong growth across businesses
Consistent track record of strong growth across businesses with the group turning strong profits Rs Cr. Rs Cr. Operating Revenue Trend 10000 FY 10 FY 11 FY 12 FY 13 FY 14 8000 Operating 5,574 6,668 7,648 8,180 9,139 Revenue 6000 Investment and 9139 2,087 1,223 914 2,444 2,544 8180 Other Income 4000
Slide 8: Max India – Q3FY15 Key Highlights
Max India – Q3FY15 Key Highlights • Structural clarity to be achieved by vertical split of Max India into 3 separate listed entities with mirror shareholding and divestment of clinical research: Max Financial Services (Life Insurance) Max India Max India (Healthcare, Health Insurance, Senior Liv
Slide 9: Max Life Insurance Company
MAX LIFE INSURANCE COMPANY (Max Life) www.maxnewyorklife.com 9
Slide 10: Indian life insurance industry has evolved since 2000
Indian life insurance industry has evolved since the opening up of the sector in 2000 Phase 1 – Joyful Entry (2000-2003) Phase 2 –Expansion (2004-2008) Phase 3 – Discovering New Normal (2009 onwards) Entry of Private Players Equity Bull Run Global Financial crisis/ Bearish Indian Stock Market
Slide 11: Bank-led insurers observed linked products gaining momentum
Top bank-led insurers observed linked products gaining momentum driven by robust capital markets Apr-Dec’13 Apr-Dec’14 Par Non Par ULIP Max Life 70% 16% 14% 58% 12% 30% Reliance Life 55% 30% 15% 15% 69% 16% SBI Life 32% 31% 37% 45% 33% 23% Birla Sunlife 21% 38% 41% 45% 23% 32% HDFC Life 40% 10% 50%
Slide 12: Max Life has remained the most consistent player delivering growth
Max Life has remained the most consistent player delivering growth Oct-Dec’13 Jan- Mar’14 Apr-Jun’14 Jul-Sep’14 Oct-Dec’14 LIC Private Total Max Life Private industry grew 53% by 1% excluding ICICI Prudential & HDFC Life 19% 21% 22% 14% 14% 5% 5% 5% 8% 0% -11% -26% -35% -54% Max Life's Private Marke
Slide 13: Max Life has distinct competitive strengths
Max Life has distinct competitive strengths which will help succeed in the new era Strong Parentage Superior Customer Retention Joint Venture between Top quartile position among major private – Max India Ltd. (leading Indian multi- players in 9MFY2015 in business corporate) – Surrender to gross
Slide 14: Top quartile performance on agency efficiency parameters
Max Life continues to maintain top quartile performance amongst top private insurers on agency efficiency parameters Average Agent Productivity Average Branch Productivity In Rs. 000's per month In Rs. Lakhs per month 10.0 14.1 SBI Life 9.8 14.2 Industry Majority of the insurers are known to Perform
Slide 15: Protection Oriented, Longer Tenor Life Insurance
Protection Oriented, Longer Tenor Life Insurance PRODUCT TYPE PROPORTION OF Tenure Age of Insured POLICIES (%, by (Years) (Years) number) WHOLE LIFE 16.8 43 33 ENDOWMENT 38.5 16 34 TERM 1.9 26 35 DEFERRED 0.1 17 41 ANNUITY MONEY BACK 5.9 15 30 UNIT LINKED 34.5 15 36 HEALTH 0.4 14 39 GUARANTEED 1.9 1
Slide 16: Track record of strong performance
Track record of strong performance New Business Growth – Adjusted FYP 1 and Renewal premium and conservation ratio 2 AUM 1800 1724 30000 6000 90% 1769 1700 25000 5000 20458 82% 83% 81% 81% 1595 1584 78% 80% 24716 1600 17215 20000 4000 1506 1513 13836 1500 15000 3000 60% 10,121 1400 10000 2000 5405 1
Slide 17: Accreditations and Awards
Accreditations and Awards Business ASQ ITEA Bronze award; CII Commendation for Business Excellence (2008, 2009 & 2010) Excellence CII 2nd Prize in Project of the Year and Quality Global Finance – Best Life Insurance Company, India 2014 Brand Excellence Award and recognition as Superbrand (2010-11,20
Slide 18: Max Healthcare (MHC)
MAX HEALTHCARE (MHC) www.maxhealthcare.in 18
Slide 19: Indian healthcare industry poised for exponential growth
Indian healthcare industry poised for exponential growth KEY HIGHLIGHTS • Indian Health Industry is poised to double to USD 125 bn by 2015E, driven by a combination of ageing population, growing lifestyle diseases and medical insurance penetration as well as increasing ability to afford quality heal
Slide 20: Increasing prevalence and propensity are key market drivers
Increasing prevalence and propensity are key market drivers Growing Health Insurance Market... Comparative medical cost 120 India UK US 100 100 80 65 (USD ’000s) Rs billion 60 48 111 84 32 40 24 66 18 19.2 51 8.5 9.8 20 32 7 4.5 6.4 14 17 22 0 FY04 FY05 FY06 FY07 FY08 FY09 FY10 FY11 Open Heart Knee
Slide 21: MHC – Mission
MHC – Mission Basis key specialty focus of Onco, Neuro, Cardiac, Ortho, MAS and Renal Sciences Basis leveraging technology for driving operational excellence Basis quality of services & benchmark our processes with global standards Become Best Align financial Basis bed capacity & Healthcare performa
Slide 22: Max Healthcare is focused on North India
Max Healthcare is focused on North India Mohali, Punjab (213 beds) Bathinda, Punjab (200 beds) Dehradun, Uttrakhand (200 beds) Saket, New Delhi (541 beds) Patparganj, New Delhi (402 beds) Shalimar Bagh, New Delhi (280 beds) Gurgaon, Haryana (64 beds) Pritampura, New Delhi (70 beds) Noida, Uttar Prad
Slide 23: MHC network
MHC network Trauma Oncology Cardiac Sciences Cardio Ambulatory Surgical Centre Trauma Neuroscience Shalimar Bag Bhatinda Dehradun Pitampura Mohali Cardiac Science Noida Patparganj Neuroscience Multi specialty Delhi care Oncology Oncology Gurgaon Orthopedics Saket Urology Cardiac Science General Card
Slide 24: Extensive focus on service excellence
Extensive focus on service excellence – a key strength for MHC • Engagement with independent external agency (IMRB) for Focus on service excellence & medical monitoring patient satisfaction quality • Strong clinical protocols • Investment in CRM; EHR; ERP Strong IT system • Leveraging IT for driving
Slide 25: MHC's Governing Philosophy
MHC’s Governing Philosophy... Provide Strategic direction GMAC1 Clinical excellence – employer of choice for physicians Drive hospital specific decisions HMAC (one for each hospital) Information technology and Service modern excellence management Idea exchange techniques forum Doctor Councils 25
Slide 26: MHC delivering superior performance across all key metrics
MHC delivering superior performance across all key metric Revenue and Contribution Margin Avg. operational beds and Avg. revenue per 1500 65.0% occupied bed day* 1350 1600 30000 1200 63.0% 23585 25126 1400 26208 1050 61.2% 25000 1200 20431 21558 61.7% 61.0% 19433 900 20000 59.6% 1000 750 59.2% 600 5
Slide 27: MHC – Accreditations and Awards
MHC – Accreditations and Awards NABH / NABL Accreditation ISO 14001:2004 & 18001:2007 at Patparganj , Pitampura & Shalimar Bagh ISO 9001:2008 at Max Heart & Vascular Institute, Patparganj, Noida, Pitampura, Shalimar Bagh, Panchsheel Park & Home Office. National Standards: Mark of Excellence : 636 as
Slide 28: Our Growth Philosophy
Our Growth Philosophy MHC expansion by 2020… 2,000 beds 3500-4000 beds 12 hospitals 20 hospitals Scope for expansion in existing units – Saket, Patparganj; & Shalimar Bagh Brown & Green field opportunities can be looked at for smaller units in NCR Asset light strategy to Addition to Phas
Slide 29: Max Bupa Health Insurance
MAX BUPA HEALTH INSURANCE (Max Bupa) www.maxbupa.in 29
Slide 30: A symbiotic partnership in the health insurance space
A symbiotic partnership in the health insurance space • India’s leading conglomerate • Global Health Insurance provider • Successful track record of with market leadership in UK, building businesses Spain & Australia • Expertise in life insurance, • 12 million customers in over 190 health insurance
Slide 31: Industry is poised for an exponential growth
Industry is poised for an exponential growth Key drivers of growth Indian Health Insurance Market (Rs. In Billion) 464 ▪ Increase in affordability 500 GWP (Rs. in Billion) 450 404 351 – Increasing affordability with rise in 400 266 305 350 income levels and healthcare spend 300 231 192 per capita 25
Slide 32: Max Bupa to capitalise on this opportunity
Max Bupa to capitalise on this opportunity through innovative product and superior service offering Relationship Manager for Simplicity, Gold & Platinum Good Transparency: Hospitalization Hassle free claim Customers experience: Technology & Comprehensive processing; No Cashless processing; automatio
Slide 33: Extensive focus on key growth levers
Extensive focus on key growth levers to maximize long-term value Leveraging Max India and BUPA capabilities • Max India - strong understanding of Indian Insurance landscape, Factsheet* – Max Bupa learning's from Max Life’s success and leverage synergies with Max Life and MHC • BUPA – Product design,
Slide 34: Max Speciality Films (MSF)
MAX SPECIALITY FILMS (MSF) www.maxspecialityfilms.com 34
Slide 35: Industry marked by robust global and domestic demand
Industry marked by robust global and domestic demand Global Demand FY 15 (KG’s) Global per capita consumption of BOPP Other App, Confectionary, 10% 5% Labels, 8% Biscuits, 14% BOPP per capita consumption in India lower than the global average 1.9 Tape, 16% 1.6 Snacks, 20% 1.2 0.8 0.5 1.6 Tobacco, 2%
Slide 36: MSF uniquely positioned as preferred global supplier of specialty polymer films
MSF uniquely positioned to be India’s most admired & preferred global supplier of Specialty Polymer films METALLISED FILM COMMODITY SPECIALITY HERMETIC SEAL, THERMAL & COATED FILM ULTRA HIGH BARRIER PACKAGING, LAMINATION, HIGH BARRIER PACKAGING, INDUSTRIAL, TEXTILES HIGH SPEED PACKAGING, PACKAGING,
Slide 37: Business evolution & infrastructure
Business evolution & infrastructure MSF Growth - FY07-14 REVENUE & Revenue CAGR: 24 % CAPACITY GROWTH QUANTITY GROWTH Quantity CAGR: 22 % EBITDA CAGR: 15 % 4 METALLISERS 4 BOPP LINES 3 EXTRUSION LINES 3 COATING LINES THERMAL LINE 3, EXPANSION LINE THERMAL LINE 1, LEATHER FINISHING 5 METALIZER 1 BOPP
Slide 38: Visibility in Top Brands
Visibility in Top Brands You will Find MSF films in… Markets we serve… Food Packaging Non Food Packaging Industrial Packaging Leather Industry 38
Slide 39: Awards & Recognition
Awards & Recognition GOLDEN WORLD STAR PEACOCK INDIA STAR YEAR 2010 YEAR 2012 YEAR -2011 YEAR -2010 YEAR -2012 39
Slide 40: Max India Foundation (MIF)
MAX INDIA FOUNDATION (MIF) www.maxindiafoundation.org 40
Slide 41: Max India Foundation – Making a difference to life
MAX INDIA FOUNDATION Making a difference… to life Max India Foundation Factsheet* – MIF • Corporate Social Responsibility (CSR) Arm of the Max Locations 500 India Group focused on providing quality healthcare to NGO Partners 367 the underprivileged, facilitating awareness of health Beneficiaries 12,
Slide 42: Annexures
SMAx Annexures
Slide 43: Consolidated Financial Snapshot (Q3 & 9MFY15)
Consolidated Financial Snapshot^ (Q3 & 9MFY15) (Rs. Cr.) Particulars Quarter ended Y-o-Y Nine month ended Y-o-Y Dec-14 Dec-13 Growth Dec-14 Dec-13 Growth Total Revenue 3,779 3,376 12% 10,756 7,943 35% Operating Revenue 2,477 2,328 6% 6,936 6,208 12% EBITDA 293 135 117% 618 385 61% PBT 235 77 206% 42
Slide 44: Vision & Mission Statement
Vision & Mission Statement To be the most admired life insurance company by securing the financial future of our customers Vision We are an honest life insurance company, committed to doing what is right We serve our customers through Long term savings, Mission protection and retirement solution
Slide 45: Market Position Insurance Sales
Market Position Insurance Sales Individual New Business Premium (Rs. Cr) Rank Company Premium Adjusted for 10% single premium Private Market Apr’14-Dec’14 Apr’13-Dec’13 Growth (%) Share 1 ICICI Prudential 3,011 2,190 37.5% 23.9% 2 SBI Life 1,887 1,882 0.3% 15.0% 3 HDFC Life 1,870 1,455 28.6% 14.9% 4
Slide 46: Max Life – Embedded Value
Max Life – Embedded Value Amount in Rs. Cr. March 31, 2014 379* 34 79 309 Operating Variance* Non 240 Recurring 3,953 Variance Unwind of 3,756 Discount** SH dividend Value of New payouts Business 2,021 1,858 Implied NBM*** is Operating RoEV of 15.6% 13.4% on APE**** Headline RoEV of 13.5% (14% in 20
Slide 47: Max Life – Key Assumptions to Embedded Value
Max Life – Key Assumptions to Embedded Value Economic Assumptions Cash/Money Market/TB 8.5% G Secs 8.8% Corporate Bonds 9.6% Equities 13.00% Unit Linked Fund Growth Rate 10.50% Interest Rate on Non-Unit Reserves 8.15% Inflation 6.50% Risk Discount Rate 13.00% Service Tax 12.36% 14.1625% (12.5% + 10%
Slide 48: Max Life – Sensitivities to Embedded Value
Max Life – Sensitivities to Embedded Value Value of New Base Case (% change*) Value of In force Business Mortality +10% -2.20% -5.20% Mortality -10% 2.20% 5.20% Lapses +10% -3.90% -6.50% Lapses -10% 4.20% 7.20% Maintenance Expenses +10% -1.10% -1.80% Maintenance Expenses -10% 1.10% 1.80% RDR +100bps
Slide 49: Max Life Embedded Value – Basis of Preparation
Max Life Embedded Value – Basis of Preparation Max Life’s Embedded Value is guided by the European Embedded Value (EEV) principles and is consistent with the reporting of traditional embedded values on a deterministic basis Allowance for risk has been made through the use of a single risk discount r
Slide 50: Max Life Insurance
Max Life Insurance Key Business Drivers Unit Quarter Ended Y-o-Y 9 months ended Y-o-Y Dec'14 Dec'13 Growth Dec'14 Dec'13 Growth a) Gross written premium income Rs. Cr First year premium 480 446 8% 1,267 1,165 9% Renewal premium 1,399 1,265 11% 3,754 3,366 12% Single premium 174 129 34% 426 315 35% T
Slide 51: MHC – Key Physicians
MHC – Key Physicians Padma Shri Dr. Rustom Phiroze Soonawala Eminent and Internationally renowned Obstetrician & Gynaecologist. MD, FRCS, FRCOG Former President of the Federation of Obstetricians and Gynaecologists Chairman, Obstetrics & Gynaecology Padma Shri Dr. Pradeep K Chowbey Prior to join
Slide 52: Max Healthcare
Max Healthcare* Unit Quarter Ended Y-o-Y 9 months ended Y-o-Y Key Business Drivers Dec-14 Dec-13 Growth Dec-14 Dec-13 Growth a) Revenue (Gross) Rs. Cr Inpatient Revenue 329 272 21% 964 768 26% Day Care Revenue 16 13 19% 45 36 25% Outpatient Revenue 94 75 26% 281 223 26% Other Operating Income (2) -
Slide 53: Max Bupa Health Insurance
Max Bupa Health Insurance Quarter Ended Y-o-Y 9 months ended Y-o-Y Key Business Drivers Unit Dec-14 Dec-13 Growth Dec-14 Dec-13 Growth a) Gross written premium income Rs. Cr First year premium* 34 41 (18%) 97 112 (14%) Renewal premium 56 35 61% 152 94 62% Total 90 76 18% 249 206 21% b) Net Earned Pr
Slide 54: Max Specialty Films
Max Specialty Films Quarter Ended Nine months ended Key Business Drivers Unit Y-o-Y Y-o-Y Growth Dec-14 Dec-13 Growth Dec-14 Dec-13 a) Sales Quantity – BOPP Tons 10,399 12,152 -14% 32,885 35,113 -6% b) Revenue Rs. Cr. 175 197 -11% 565 550 3% c) Profitability: Contribution Rs. Cr. 30 25 22% 100 83 20
Slide 55: Disclaimer
Disclaimer This presentation has been prepared by Max India Limited (the “Company”). No representation or warranty, express or implied, is made and no reliance should be placed on the accuracy, fairness or completeness of the information presented or contained in the presentation. The past performan
Slide 56: Max India Ltd. contact details
MAX INDIA LTD. Max House, Okhla, New Delhi – 110 020 Phone: +91 11 26933601-10 Fax: +91 11 26933619 Website: www.maxindia.com 56