Poonawalla Fincorp Limited · NSE:POONAWALLA
Poonawalla Fincorp — Q3 FY22 Earnings Presentation
51 slides from Poonawalla Fincorp's earnings presentation, Feb 1, 2022
Slide 1: Exchange filing cover letter
February 01, 2022 BSE Limited National Stock Exchange of India Limited Corporate Relationship Department The Listing Department, 25th Floor, Phiroze Jeejeebhoy Towers, Exchange Plaza, Dalal Street, Fort, Bandra- Kurla Complex, Bandra (East), Mumbai - 400 001. Mumbai - 400 051. BSE Scrip Code: 524000
Slide 2: Poonawalla Fincorp Limited Investor Presentation Q3FY22
Poonawalla Fincorp Limited (Formerly known as Magma Fincorp Limited) Investor Presentation Q3FY22
Slide 3: Agenda
Agenda 1 Executive Summary 2 Business Strategy 3 Business and Financial Update – Consolidated 4 Business and Financial Update – Subsidiary / Joint Venture 5 Shareholding Pattern and Leadership Team 2
Slide 4: 1. Executive Summary
1. Executive Summary
Slide 5: Executive Summary (1/2)
Executive Summary (1/2) Business ▪ AUM at ₹15,228 cr as on 31-Dec-21 | remains flat QoQ & YoY | Focused products AUM 6% QoQ to ₹11,602 cr ▪ Organic disbursement 28% YoY and 19% QoQ | Business gaining momentum with the bouncing back of economy ▪ Co-Lending / Fintech Partnerships entered with la
Slide 6: Executive Summary (2/2)
Executive Summary (2/2) Funding & Liquidity ▪ 100% of eligible term loans repriced by over 160bps in YTDFY22 | Incremental funding at sub 6.5% ▪ Diversification progressing well - two-thirds of incremental borrowings from foreign, private sector banks and capital markets ▪ Ample liquidity - over ₹4,
Slide 7: 2. Business Strategy
2. Business Strategy
Slide 8: Management Vision 2025
Management Vision 2025 To be amongst Top 3 NBFCs for consumer and small business finance “To be a diversified tech- enabled NBFC focused on risk Risk-calibrated accelerated growth ~3x of FY21 AUM calibrated growth, with customer centric approach, Amongst the lowest COF in the industry ~250 bps reduc
Slide 9: Core Strategic Pillars
Core Strategic Pillars Building on benefits derived End-to-end digitization using Capital from being part of the Cyrus data analytics and Digital Poonawalla group Parentage 1 7 Focus 2 6 Highly experienced Professional Asset Quality Focus on asset quality management team with Management and Risk thr
Slide 10: Phased Strategy Execution
Phased Strategy Execution Consolidate-Grow-Lead Consolidate Grow Lead (1-9 months) (9-18 months) (18-36 months) • People • Build scale with new products and • Leadership in chosen Products expand cross sell • Products • Leadership in chosen • Build branch lite model Geographies • Branches • Enhance
Slide 11: Phased Strategy Execution - Update
Phased Strategy Execution - Update Consolidate-Grow-Lead ▪ Senior leadership team on board Consolidate ▪ New business lines - teams hired, trained and deployed. Well supported by credit, (1-9 months) People risk and IT teams ▪ Extensive rebound program for skill enhancement • People ▪ Multiple Co-Le
Slide 12: Product Strategy Roadmap
Product Strategy Roadmap Existing products Products launched during the year Product pipeline Pre-owned Cars Personal Loan Consumer Finance Business Loans Loan to Professionals Supply Chain Finance Affordable Home Loan SME LAP EMI Card Co-Lending / Affordable LAP Co-branded Credit Card Fintech partn
Slide 13: Digital journey architecture
Digital journey architecture To build a digital first business architecture Digital Key Mission Principles Build Leading Agility in Building Scalable D2C Engine Partnerships Enable Branch 100% Automated BRE Lite Customer model Quick Decisioning Build Diverse Digital 100% Straight Through Collections
Slide 14: Technology architecture
Technology architecture Current landscape & way forward Business Scale Agility to Launch Partner Compatible Key Pillars Faster Go to Market New Products Solutions Current Go Forward Assisted credit underwriting STP decisioning leveraging AI models Loan Origination Loan Management Support traditional
Slide 15: Data Science and Analytics
Data Science and Analytics Sales & Distribution Credit Underwriting and Collections Risk Monitoring Key Initiatives Key Initiatives Key Initiatives ▪ Identified Geo-Expansion opportunity ▪ Enhanced BRE developed for POC and ▪ Developing Risk Segmentation of based on Market Potential, Portfolio Perso
Slide 16: Liability Strategy
Liability Strategy Pillars for building a resilient liability franchise Diversification of liabilities • Two-thirds of incremental borrowings from foreign, private sector banks and capital markets • Progressive increase in capital market borrowings to reach steady state range of 40%-45% 3 Robust Liq
Slide 17: 3. Business and Financial Update
3. Business and Financial Update
Slide 18: Business Update (1/2)
Business Update (1/2) Pre-owned Cars (POC) Unsecured Loans Continued focus on Fintech Partnership for accelerated Digital partnerships with a large partner gone live in growth Q3FY22 Focus towards formal segment customers | Disbursement Number of locations increased from 59 in Q2FY22 to 97 in to the
Slide 19: Business Update (2/2)
Business Update (2/2) Affordable HL and LAP SME LAP Channels onboarded increased from 300+ in Q2FY22 to Geo expansion from 103 in Sep 21 to 113 in Dec-21 600+ in Q3FY22 Sourcing commenced at 38 out of 65 identified locations Mix of Home Loans disbursement (Units) stood at 71% (21 in Q2FY22) Direct S
Slide 20: Key Financial Parameters
Key Financial Parameters Disbursement AUM Gross and Net Stage 3 % 2,580 15,275 6.9% 15,228 1,845 15,006 1,285 4.5% 302 4.1% 1,208 3.5% 1,543 2.0% 1.8% 1,295 Q3FY21 Q2FY22 Q3FY22 Dec-20 Sep-21 Dec-21 Dec-20 Sep-21 Dec-21 CRAR (Standalone) & Net Worth Leverage CoB 52.2% 54.2% 154bps 5,841 5,925 9.6% 2
Slide 21: Diversified AUM Mix
Diversified AUM Mix AUM 15,006 14,225 14,424 15,275 15,228 62% 59% 58% 55% 51% 32% 34% 31% 31% 28% 16% 13% 10% 10% 10% Dec-20 Mar-21 Jun-21 Sep-21 Dec-21 Secured by Hard Collateral Secured by Movable Collateral Unsecured 20
Slide 22: Asset Quality – Q3 FY22
Asset Quality – Q3 FY22 PFL PHFL Consol Dec-20 Sep-21 Dec-21 Dec-20 Sep-21 Dec-21 Dec-20 Sep-21 Dec-21 Stage 1 Assets % 78.8% 80.9% 82.4% 90.8% 86.0% 87.3% 81.2% 82.1% 83.7% Stage 2 Assets % 13.0% 14.3% 13.5% 7.3% 12.1% 10.8% 11.8% 13.8% 12.8% Stage 1 PCR (%) 1.7% 1.5% 1.7% 0.3% 0.3% 0.5% 1.3% 1.2%
Slide 23: Asset Quality – Impact of RBI circular
Asset Quality – Q3 FY22 Impact of RBI circular on IRACP norms ▪ As on 31-Dec-21, an amount of ₹552 cr will get added to GNPA for regulatory reporting purpose ▪ Collection efficiency for the aforesaid pool in GNPA stands at 107% in Dec-21 ▪ Provision under Ind AS remains substantially higher compared
Slide 24: Asset Quality
Asset Quality Collection Efficiency surpasses Pre-COVID Level Restructuring ▪ Total restructured assets as at 31-Dec-21 was ₹864 cr (5.7% of AUM). ▪ Out of total restructured assets of ₹864 cr, ₹428 cr (49%) is in 0 bucket. However, for the purpose of asset classification and provisioning, ₹684 cr (
Slide 25: Well matched ALM
Well matched ALM Structural Liquidity as on 31-Dec-21 Cumulative inflows Cumulative outflows 14,559 14,559 13,140 11,733 8,299 8,757 7,575 6,091 5,132 4,022 3,108 849 1,408 436 0-1m 1-3m 3-6m 6m-1y 1-3y 3-5y >5y Cumulative 2,672 3,173 3,724 1,484 3,435 4,383 0 Positive Gap Cumulative (%) 612% 374% 2
Slide 26: Profit & Loss Statement - Consolidated
Profit & Loss Statement - Consolidated Q3FY22 Q2FY22 Q3FY21 YTDFY22 YTDFY21 FY21 Particulars Q3FY22 Q2FY22 Q3FY21 YTDFY22 YTDFY21 FY21 8.8%* 9.1% 8.5% 8.6%* 7.8% 8.2% NIM (incl. fee income) 334 336 326 954 915 1,252 5.1% 4.8% 3.3% 4.8% 3.4% 3.6% Opex# 196 177 126 528 397 542 3.6% 4.3% 5.2% 3.9% 4.4%
Slide 27: 4. Business & Financial Update – Subsidiary / Joint Venture
4. Business & Financial Update – Subsidiary / Joint Venture
Slide 28: Poonawalla Housing Finance Limited
Poonawalla Housing Finance Limited (Formerly known as Magma Housing Finance Limited) (Subsidiary)
Slide 29: Business Update - PHFL
Business Update Poonawalla Housing Finance Limited AUM of ₹4,574 Cr as on 31-Dec-21 vs ₹3,709 Cr as on 31-Dec-20; 23% YoY; 7% QoQ; 3-year CAGR - 28% Disbursement of ₹535 Cr in Q3FY22 vs ₹367 Cr in Q3 FY21; 46% YoY; 37% QoQ Significant reduction in CoB from 9.6% for Q3FY21 to 8.3% (normalized
Slide 30: Key Financial Parameters - PHFL
Key Financial Parameters - PHFL Disbursement AUM Gross and Net Stage 3 % 535 4,287 4,574 1.9% 1.9% 1.9% 3,709 390 82 367 1.3% 1.2% 1.2% 453 Q3FY21 Q2FY22 Q3FY22 Dec-20 Sep-21 Dec-21 Dec-20 Sep-21 Dec-21 CRAR and Net Worth Leverage CoB 53.7% 130 bps 49.9% 9.6% 32.8% 1,038 1,048 4.9 8.8% 8.3% 514 2.3
Slide 31: Diversified AUM Mix - PHFL
Diversified AUM Mix - PHFL Product-wise On book vs Off book Zone-wise 0.4% 19% 36% 30% 33% 64% 7% 81% 30% HL LAP CF On-book Off-book North South East West With the fresh capital infused during the year, the company is poised for accelerated growth in AUM 30
Slide 32: Business Update - PHFL
Business Update - PHFL Direct Ratio (Units) Home Loan Ratio (Units) 72% 78% 80% 78% 65% 67% 66% 75% 44% 37% FY18 FY19 FY20 FY21 YTD FY22 FY18 FY19 FY20 FY21 YTD FY22 Home Loans Ratio in fresh disbursement has grown Direct sourcing ratio maintained at >75% from 37% in FY18 to 72% as on YTD FY22 31
Slide 33: Strong ALM Profile with Adequate Liquidity - PHFL
Strong ALM Profile with Adequate Liquidity - PHFL Structural Liquidity Statement as on 31-Dec-21 Cumulative Inflow Cumulative Outflow 6,775 4,369 4,481 3,181 2,955 2,377 1,485 1,014 477 447 722 681 153 119 0 - 1 Month 1 - 3 Month 3 - 6 Month 6 - 1 Year 1 - 3 Years 3 - 5 Years > 5 Years Cumulative Ga
Slide 34: Profit & Loss Statement - PHFL
Profit & Loss Statement - PHFL Q3FY22 Q2FY22 Q3FY21 YTDFY22 YTDFY21 FY21 Particulars Q3FY22 Q2FY22 Q3FY21 YTDFY22 YTDFY21 FY21 5.7%* 6.4% 8.4%# 5.6%* 6.3%# 6.8% NIM (incl. fee income) 63 67 77 181 165 246 3.8% 3.1% 2.9% 3.2% 2.7% 2.8% Opex 42 32 26 102 72 102 1.8% 3.4% 5.6% 2.4% 3.5% 4.0% PPOP 20 35
Slide 35: Magma HDI General Insurance Limited
Magma HDI General Insurance Limited (Joint Venture)
Slide 36: Highlights
Highlights Wide range of IRDAI approved products 67+ with multiple add-ons attached to products Extensive network of IRDAI approved intermediaries 9200+ across the country One of the highest GDPI growth of 36% for 9mFY22 vis-à-vis 10% & 11% growth for private sector and Industry resp. Moved up “1” n
Slide 37: Built on Strong Risk Foundation
Built on Strong Risk Foundation Achieved robust growth rate over the years GWPI FY18 – FY21 CAGR ~34% 1,349 1,294 33% 1211 1,026 911 560 FY18 FY19 FY20 FY21 9mFY21 9mFY22 GWP 560 1,026 1,294 1,349 911 1211 GDPI Growth 26% 84% 26% 5% -4% 36% Industry Growth 17% 13% 12% 6% 3% 11% GWPI Growth 32% 83% 2
Slide 38: Diversified Distribution & Portfolio Mix
Diversified Distribution & Portfolio Mix 24% -21% 119% 33% 25% Distribution Mix & 501 314 237 Growth 122 37 44% 41% 17% 10% 16% 26% 20% 20% 3% 3% Agency & Others Banca & Others* OEM Commercial Business e-Sales, MSME & Others 9mFY21 9mFY22 GWPI Growth Growth Motor OD Motor OD 6% 7% 49% 5% 5% Portfoli
Slide 39: Enhancing Distribution Through Partnerships
Enhancing Distribution Through Partnerships Offices & Channel Partners FY19 FY20 FY21 9mFY22 Number of Branches 169 170 133 131 Agents + POS* + MISP# 5,028 6,558 7,614 9,286 Corporate Agents 7 13 11 12 OEM^ Tie-ups 1 6 14 20 Number of Districts where policies are issued : 598 Number of Districts where
Slide 40: Focus on increasing Non Motor Portfolio
Focus on increasing Non Motor Portfolio Motor GWPI and Share Retail Run Rate 80% 73% 72% 75% 74% 338 414 304 320 221 138 101 107 113 747 1029 901 74 969 679 FY19 FY20 FY21 9mFY21 9mFY22 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 GWPI Share Qtrly Retail Business Mthly Retail Run Rate Commercial and Health GW
Slide 41: Continuous Accretion in Investment Book
Continuous Accretion in Investment Book Combined Ratio Movement Investment Book & Leverage ratio 120.7% 120.0% 117.7% 117.5% 117.0% 120.4% 119.0% 8.1 36.4% 6.9 40.3% 35.4% 40.3% 49.1% 47.8% 52.0% 5.4 4.7 3,529 2,994 84.3% 79.6% 82.1% 80.1% 2,285 69.9% 65.0% 69.9% 1,462 FY20 FY21 Q2FY22 Q3FY21 Q3FY22
Slide 42: Profit & Loss Statement (Ind AS)
Profit & Loss Statement (Ind AS) Particulars Q3FY22 Q3FY21 Q2FY22 YTDFY22 YTDFY21 FY21 Gross Written Premium 488 358 400 1,211 911 1,349 Net Written Premium 321 226 269 771 561 798 Net Earned Premium 232 192 224 659 570 762 Net Claims Incurred 151 149 157 461 457 607 Net Commission (4) (12) (1) (17)
Slide 43: 5. Shareholding Pattern & Leadership Team
5. Shareholding Pattern & Leadership Team
Slide 44: Holding Structure & Shareholding Pattern
Holding Structure & Shareholding Pattern Rising Sun Holdings Private Shareholding (31-Dec-21) Limited (owned and controlled by Mr. Adar Poonawalla) Public, 12.83% 61.52% Domestic Poonawalla Fincorp Limited Investors, 13.10% FII, 5.82% Promoters, 99.22% 36.43%* 68.25% Magma HDI General Poonawalla Hou
Slide 45: Board of Directors
Board of Directors Mr. Adar Poonawalla Mr. Amar Deshpande Ms. Vijayalakshmi R. Iyer Mr. Bontha Prasad Rao Chairman & Non-Executive Director Non-Executive Non-Executive Non-Executive Director Independent Director Independent Director Mr. Sajid Fazalbhoy Mr. Prabhakar Dalal Mr. Sanjay Kumar Mr. G. Jag
Slide 46: Management Team
Management Team Vijay Deshwal Gaurav Sharma Group Chief Executive Officer Group Chief Technology Officer Previously, Business Head, Service Sector Group at ICICI Bank Previously, Chief Technology Officer at L&T Financial Services Sanjay Miranka Mahender Bagrodia Group Chief Financial Officer Head-Co
Slide 47: Annexure
Annexure
Slide 48: Profit & Loss Statement - PFL Standalone
Profit & Loss Statement - PFL Standalone Q3FY22 Q2FY22 Q3FY21 YTDFY22 YTDFY21 FY21 Particulars Q3FY22 Q2FY22 Q3FY21 YTDFY22 YTDFY21 FY21 9.8% 9.8% 8.2% 9.6% 8.0% 8.4% NIM (incl. fee income) 270 269 247 770 747 1,002 5.6% 5.3% 3.3% 5.3% 3.5% 3.7% Opex# 154 145 100 426 325 440 4.2% 4.5% 4.9% 4.3% 4.5%
Slide 49: Disclaimer
Disclaimer This presentation has been prepared by Poonawalla Fincorp Limited (the “Company”), for general information purposes only, without regard to any specific objectives, suitability, financial situations and needs of any particular person and does not constitute any recommendation or form part
Slide 50: Disclaimer (Contd.)
Disclaimer (Contd.) The information contained in these materials has not been independently verified. None of the Company, its directors, promoter or affiliates, nor any of its or their respective employees, advisers or representatives or any other person accepts any responsibility or liability what
Slide 51: Thank You!
POONAWALLA FINCORP Thank You! www.poonawallafincorp.com