Axis Bank Limited · NSE:AXISBANK
Axis Bank — Q1 FY2022 Earnings Presentation
68 slides from Axis Bank's earnings presentation, July 2021
Slide 1: Investor Presentation Quarterly Results Q1FY22
Investor Presentation Quarterly Results Q1FY22 NSE: AXISBANK BSE: 532215 LSE (GDR): AXB
Slide 2: Axis Bank at a glance
Axis Bank at a glance Axis Bank 3rd largest 4,600 80,250+ 5th straight year Private Bank in India Branches* Employees Constituent of FTSE 4Good EI ^ Traditional Banking Segment Digital Banking Segment Market Share 5.1% 4.6% 5.7% 15% 14% 11% Assets # Deposits ## Advances ## UPI ** Mobile** CIF ^^ Pro
Slide 3: Executive Summary
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 3
Slide 4: Major highlights of Q1FY22
Major highlights of Q1FY22 Healthy CASA deposits growth, steady operating performance, resilient balance sheet • Deposits* on QAB basis grew by 11% YOY and 7% QOQ, Loan* book grew by 12% YOY and was flat sequentially Healthy growth in granular CASA deposits • On QAB basis, SA grew 19% YOY and 7% QOQ
Slide 5: Key metrics for Q1FY22
Key metrics for Q1FY22 Snapshot (As on 30th June 2021) Deposits # 11% YOY Advances 12% YOY Absolute (Rs. Cr) YOY Growth Q1FY22 YoY growth Net Interest Income 7,760 11% Profit & 36% Loss Fee Income 2,668 62% Operating Expenses 4,932 32% 54% Operating Profit 6,416 10% 83% 10% Net Profit 2,160 94% Q1FY
Slide 6: Financial Highlights
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 6
Slide 7: Steady growth in granular deposits continue to drive loan growth
Steady growth in granular deposits continue to drive loan growth Deposits (QAB)^ Loans All figures in ₹ Billion 6,144 6,149 12% YOY 6,858 11% YOY 5,646 6,427 5,488 5,699 6,156 6,051 6,048 6% 7% 40% YOY 6% 6% 6% 10% YOY 94% 94% 94% 94% 93% Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Jun-20 Sep-20 Dec-20 Mar-2
Slide 8: Progress on building a stable low cost deposit franchise
Progress on building a stable low cost deposit franchise on track, with healthy growth in CASA Savings account balances^ Current account balances^ All figures in ₹ Billion 19% 17% 18% 18% 17% 15% 15% 14% 15% 8% 5% 6% 7% 2% 4% 10% 3% 4% -0.4% 0.2% 2,016 878 875 1,788 1,889 767 800 1,692 1,726 745 Q1F
Slide 9: Operating performance has been steady
Operating performance has been steady All figures in ₹ Crores Operating revenue Operating Expense 2.00% 1.97% 2.05% 1.96% 1.96% 12,223 5,359 11,348 19% YOY 5,054 4,932 11,133 11,149 4,235 9,572 4,668 3,728 3,807 3,776 3,588 39% YOY 2,587 3,376 3,691 3,081 2,822 2,322 6,985 7,326 7,373 7,555 7,760 11
Slide 10: Net interest margin
Net interest margin Advances mix by rate type Cost of Funds 28% MCLR Duration Split (Jun-21) 5.62% 4% 5.42% 5% 5.20% 1M 4.93% 29% 2% 3M, 4% 4.60% 4.30% 4.10% 3.97% 12M, 17% 6M, 11% 34% Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 MCLR linked Fixed Foreign currency- floating Base Rate link
Slide 11: We continue to focus on building granularity in fees
We continue to focus on building granularity in fees All figures in ₹ Crores Retail Banking fees Retail fee mix Retail fee during Q1FY21 was impacted by lower loan disbursements, lower card issuance related fees and interchange 36% 35% income, and service charge waivers pursuant to regulations 32% 3
Slide 12: Capital and Liquidity Position
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 12
Slide 13: Strong capital position with adequate liquidity
Strong capital position with adequate liquidity Bank’s Capital Adequacy Ratio Liquidity Coverage Ratio (consolidated) Bank raised ₹10,000 crores 140% of equity capital in Aug’20 130% 120% 19.12% 19.01% 117% 120% 115% 115% 112% 17.53% 15.84% 3.72% 3.59% 110% 106% 4.19% 4.57% 15.40% 15.42% 100% 13.34%
Slide 14: Business Segment performance
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 14
Slide 15: Retail Banking
Retail Banking ~25.7 Mn 4th `2.3 Tn Largest issuer of AUM in wealth SA customers Credit Cards ** management 83% 73% 54% CASA + RTD ratio Sourcing* from ETB Share of (QAB) customers Advances# 19% 14% 62% Growth in SA Growth in Share in total fee^ QAB deposits advances *for Retail Assets in Q1FY22 fro
Slide 16: Healthy growth in SA deposits led by deepening and premiumisation strategy
Healthy growth in SA deposits led by deepening and premiumisation strategy • Created liability sales vertical in FY20 to have greater outreach and sharper focus on quality of NTB* acquisitions; Branch channel continued • its focus on deepening ETB* relationships • Premiumisation strategy focuses on
Slide 17: Deep Geo strategy has been scaling up well
Deep Geo strategy has been scaling up well Drive higher business growth and increase market share in Rural and Semi Urban markets through asset led liability strategy • Holistic banking opportunities in RuSu markets to complement the Bank’s overall growth strategy meaningfully Distribution network K
Slide 18: Retail loan book is well diversified and ~80% secured
Rs 3 trillion Retail loan book is well diversified and ~80% secured with significantly high proportion of ETB and salaried customers Higher customer engagement led to broad base growth from ETB relationships Retail book ~ 80% of our retail book is secured Disbursement trends in secured loans (in ₹ B
Slide 19: We are the 4th largest issuer of Credit Cards in the country
We are the 4th largest issuer of Credit Cards in the country Featured Cards Credit Cards in force (mn) Axis Bank Aura 12.1% 11.9% 11.7% 11.5% 11.4% 11.4%* Credit Card Co-branded Cards • Launched ‘AURA’ credit card with focus on Health & Wellness need 7.0 6.8 6.9 6.9 7.1 7.2 of the customers; • Indus
Slide 20: Trends in Card spends
Trends in Card spends • ‘GRAB DEALS’ our Shopping platform which is gaining popularity recently, hosted a 10 day event called "Grab Deals Fest’ starting 25th June where we offered excusive deals to our Debit and Credit card customers. This was the first of many campaigns which the customers can look
Slide 21: We continue to grow Acquiring through innovations and integrated approach
We continue to grow Acquiring through innovations and integrated approach Throughput trend & market share Innovations in Acquiring (In ₹ thousand crores) Android PoS: State-of-the-Art terminal loaded with Jun’20 Sep’20 Dec’20 Mar’21 May’21 VAS such as Khaata & BQR. 10.8% 12.0% 13.5% 13.4% 14.2% • 33
Slide 22: The Bank is a leading player in India's Wealth Management space
The Bank is a leading player in India’s Wealth Management space Overall Burgundy Performance* (Mar’17 -Jun’21) AUM^ 28.7% Customer Base 20.6% Touchpoints~ 8.5% • Overall AUM ₹ 2,30,873 Crores • Burgundy Private AUM ₹ 63,372 Crores * CAGR growth for Mar-17 to Jun-21 period ~ includes RMs, Wealth Spec
Slide 23: We have a strong and well diversified distribution network
We have a strong and well diversified distribution network Domestic branch network* Branch presence across categories Axis Virtual Centre 4,528 4,594 4,600 16% 4,050 30% 3 mn 6 Customer Centers connect ^ 31% 1500 Virtual RMs 23% Mar-19 Mar-20 Mar-21 Jun-21 * Includes extension counters Metro Urban S
Slide 24: Corporate & Commercial Banking
Corporate & Commercial Banking 8% 18% 36% YOY growth in YoY growth in YoY growth in corporate advances CBG* advances Mid Corporate book 36% 85% 94% Share of short Share of corporate Incremental sanctions term loans to overall advances to clients to A-and above** corporate loans rated A-and above 17%
Slide 25: Strong relationship led franchise driving synergies across One Axis entities
Strong relationship led franchise driving synergies across One Axis entities We have re-oriented the organisation structure in Corporate & Commercial Banking for delivering execution excellence • Segregated the responsibilities of coverage and product groups to ensure sharper focus • Corporate & Com
Slide 26: Better rated originations and focussed on short term loans
…with better rated originations and focussed on short term loans All figures in ₹ Crores Incremental sanctions to corporates 85% of the book is rated A- or better rated A- & above 18% 17% 15% 15% 65% of sanctions were to those rated AA- & above 95% 95% 94% 94% 82% 83% 85% 85% FY19 FY20 FY21 Q1FY22 M
Slide 27: Overseas corporate loan book is 95% India linked
Overseas corporate loan book is 95% India linked • The Bank’s International strategy is to focus on Indian corporates that have global operations • We have consolidated our overseas business through branches in Dubai, Singapore and Gift City, India • Gift City IBU1 has grown strongly as we continue
Slide 28: We have strengthened our proposition as a Transaction Bank
We have strengthened our proposition as a Transaction Bank Current Account Greenwich Service Excellence 2021 17% YoY growth in Current Account quarterly 1 for Large Corporates and Middle Markets – Knowledge average Balances (Q1FY22) of Transaction Banking needs Foreign LC Market Share Digital Adopti
Slide 29: Well placed to benefit from a vibrant Corporate Bond market
We remain well placed to benefit from a vibrant Corporate Bond market All figures in ₹ Crores Placement & Syndication of Debt Issues Movement in corporate bonds Amount mobilized / arranged^ Market share and Rank* 36,915 34,904 33,071 32,190 31,183 2nd 1st 38,061 18% 16% 16% 16% 14% 17,733 25.9% 23.4
Slide 30: Industry-wise Distribution (Top 10)
Industry-wise Distribution (Top 10) All figures in ` Crores Outstanding1 as on 30th Jun’21 Total Non-fund Rank Advances Investments based Sectors Value (in % terms) 1. Financial Companies2 58,271 20,045 22,110 100,426 13.12% 2. Engineering & Electronics 11,933 2,041 26,988 40,962 5.35% 3. Infrastruc
Slide 31: Business Performance: Commercial Banking
Business Performance Commercial Banking
Slide 32: Commercial Banking benefitting from technology led transformation
Commercial Banking business benefitting from technology led transformation • One of the most profitable segments of the Bank with high PSL coverage • Data driven credit decisions, minimal documentation, simplified products and digitized operations aiding higher business growth CBG Current Account CB
Slide 33: SME lending book is well diversified, 96% secured
SME lending book is well diversified, 96% of SME book is secured and predominantly working capital financing Book by Loan size Well diversified Geographical mix Well diversified Sectoral mix 16% 15% 23% 17% 16% 2% 30% 4% 9% 9% 4% 18% 4% 9% 10% 4% 11% 4% 26% 21% 19% 8% 5% 8% 8% Less than 5 Cr 5 cr to
Slide 34: Digital Banking – Axis Bank's silent revolution
Digital Banking – Axis Bank’s “silent revolution” 84% ~74% 67% 69% 60% 57% 4.6 Digitally active Credit cards New SA Fixed deposits PL disbursed** New MF SIP Mobile App customers(Q1FY22) issued (Q1FY22) acquisition* opened** sales (Q1FY22) ratings D2C products Services on 250+ Market share in 15% 14%
Slide 35: OPEN approach for our bouquet of digital products
OPEN approach across the Bank for our bouquet of digital products Deposits Investments & Insurance Loans & Cards 0-based redesign; customer centric, design led and 0-operations Proprietary in-house capabilities Saving Accounts Current Accounts Mutual Funds General Insurance Personal loan Credit card
Slide 36: Building a Strong Digital Suite for Retail Forex Business
Building a Strong Digital Suite for Retail Forex Business Servicing the Forex needs of our retail customers, through ‘frictionless-digitized’ transactions 1 Launched Outward Remittance on Mobile App • A simple 2 step intuitive customer journey with 24/7 enablement for anytime anywhere payment proces
Slide 37: We are investing heavily in building capabilities
We are investing heavily in building capabilities 1 Building the right talent 2 Enabling the team through technology • ~ 850 people dedicated to digital agenda • Fully cloud ready: new customer facing applications as cloud native • ~75% new hires from non-banking background • CI-CD pipeline in place
Slide 38: Strong market share in Mobile Banking
We continue to have strong market share in Mobile Banking Axis Mobile is amongst the highest ranked Banking app on Apple Store (rating of 4.6) & Google Play Store (4.5) and offers 250+ DIY services Mobile Transactions Market Share by Volumes Axis Bank Mobile Banking Spends (in Cr) and Volumes (in Mn
Slide 39: Axis Bank – Pioneer in the UPI Ecosystem
Axis Bank – Pioneer in the UPI Ecosystem Powering all major UPI TPAPs – Google Pay, PhonePe, Amazon, A world of features offered on Axis UPI Whatsapp Money Transfers to Friends & Family Processing nearly 400 million+ monthly transactions as Payer PSP Shopping & Merchant Acquiring more than 6 million
Slide 40: UPI has scaled up tremendously
UPI has scaled up tremendously to become a key channel for customer transactions We have developed best-in-class UPI stack that enables us to offer cutting edge customized solutions across SDK, Intent, Collect and Pay offerings apart from new use cases like UPI AutoPay Dedicated IT cloud infrastruct
Slide 41: Asset Quality
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 41
Slide 42: Asset quality metrics stable, healthy provision cover
Asset quality metrics stable, healthy provision cover, slippages elevated due to Covid restrictions GNPA & NNPA GNPA 3.85% & NNPA 1.20% 4.72% 4.55% 4.28% 3.70% 3.85% Corporate Total Retail SME 54%^ 73%^ 79%^ 70%^ 5.3% 2.6% 4.0% 3.9% 1.23% 1.19% 1.20% 1.2% 1.03% 1.05% 1.2% 1.2% 1.1% Q1FY21 Q2FY21* Q3
Slide 43: BB & Below Corporate Book, Restructuring and NPAs
BB & Below Corporate Book, Restructuring and NPAs All figures in ₹ Crores Bank’s Net NPA* and Fund based BB and Below* portfolio Key comments on BB and Below book ▪ ~ 100% of restructured corporate book classified as BB & below PCR (excluding technical write offs) at 70%; net NPA improved 3 bps YoY
Slide 44: Detailed walk of NPAs over recent quarters
Detailed walk of NPAs over recent quarters All figures in ₹ Crores Q1FY21 Q2FY21^ Q3FY21^ Q4FY21 Q1FY22 Gross NPAs - Opening balance A 30,234 29,560 27,472 29,046 25,315 Fresh slippages B 2,218 1,750 7,993 5,285 6,518 Upgradations & Recoveries C 608 2,026 2,162 3,463 2,543 Write offs D 2,284 1,812 4
Slide 45: Future of Work and Sustainability
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 45
Slide 46: Future of Work initiative: multiple flexible work formats
The Future of Work initiative has evolved into multiple flexible work formats GIG-A-Opportunities Access to new Talent Pools Hiring program in alternate • 130 candidates hired in alternate formats formats: skilled freelancers and • 44% Women, 54% Non Banking Talent, 50% Non-Metro virtual full time e
Slide 47: Axis Bank's ESG Imperative
Axis Bank’s ESG Imperative Banking that leads to a more inclusive and equitable economy, thriving community and a healthier planet Inclusive and Equitable Economy Thriving Community Healthier Planet We are committed to providing We are committed to working with We are committed to consciously nurtur
Slide 48: Strong ESG Oversight in place
We are putting Strong ESG Oversight in place ESG a Board-level agenda Key ESG Policies in Public Domain • Bank’s ESG strategy reviewed at the BOD • Code of Conduct and Ethics (Link) • Human Rights Policy (Link) • CSR Committee’s Charter expanded to include ESG oversight • Diversity, Equity & Inclusi
Slide 49: Positive Outcomes and Impact Across the ESG Spectrum
Positive Outcomes and Impact Across the ESG Spectrum Key sustainability performance highlights Sustainable Banking and Finance Banking • Corporate Lending Portfolio of ~ Rs 10,000 Crores in green sectors as on 31st March 2021 • 37 funding proposals assessed under Sustainable Lending Policy and Proce
Slide 50: Positive Outcomes and Impact Across the ESG Spectrum
Positive Outcomes and Impact Across the ESG Spectrum Key sustainability performance highlights Corporate Social Responsibility • 0.92 million households reached under Axis Bank Foundation’s Mission 2 Million target • Axis DilSe – Over 300 students being supported at Lyzon Friendship School in rural
Slide 51: Highest Standards of Data Security and Customer Privacy
Committed to Highest Standards of Data Security and Customer Privacy Cyber Security Framework Identify Protect Detect Respond Recover Information assets and Safeguards to prevent Timely discover Actions to timely contain Plans for resilience and applicable risks cyber attacks occurrence of cyber eve
Slide 52: Subsidiaries' Performance
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 52
Slide 53: Significant value creation in our key group entities
Significant value creation happening in our key group entities Detailed One Axis presentation Link Invst Banking Consumer Retail Fintech Asset Management Trustee TReDS platform Insurance & Inst Equities focused NBFC Brokerage platform One of the fastest Leadership position in AAA rated NBFC with 3rd
Slide 54: Axis AMC: Strong performance, AUM growth of 55% YOY
Axis AMC : Strong performance, AUM growth of 55% YOY, PAT up 90% YOY All figures in ₹ Crores Overall QAAUM Equity QAAUM 45% CAGR* 48% CAGR* 2,08,143 1,96,549 1,07,936 76% YOY 55% YOY 98,822 1,38,402 1,34,316 61,968 61,223 89,720 44,486 Mar-19 Mar-20 Mar-21 Jun-20 Jun-21 Mar-19 Mar-20 Mar-21 Jun-20 J
Slide 55: Axis Capital: Go to Banker for India Inc
Axis Capital : Go to Banker for India Inc Q1FY22 Ranking* (includes IPO, FPO, QIP, REIT, InvIT, OFS & Rights) Major Highlights Rank Banker No of Deals* • 19 IB transactions were completed in Q1FY22 that include 6 IPOs, 6 QIPs, 2 OFS, 1 Rights issue and 2 PE advisory deals among others 1 Axis Capital
Slide 56: Axis Securities: Strong performance in Q1FY22
Axis Securities : Strong performance in Q1FY22 with 93% growth in revenue Total customer base (in mn) Axis Securities had acquired nearly 1 mn Karvy’s trading accounts 59% YOY Major Highlights in Q4FY21, making Axis Securities as the 3rd largest bank led 29% CAGR* retail brokerage in terms of custom
Slide 57: Axis Finance: Poised for growth, PAT grew 86% YOY
Axis Finance : Poised for growth, PAT grew 86% YOY All figures in `₹ Crores Growth in loan book Major Highlights 15% CAGR** • 20.6% Capital adequacy ratio 43% YOY 11,107 10,259 • 1.8% Net NPA% with near nil restructuring 8,040 7,704 7,748 • 7 times YOY growth in Retail book with retail disbursements
Slide 58: A.TReDS: Invoicemart continues to be a market leader
A.TReDS: The Invoicemart product continues to be a market leader A.TREDS is one of the three entities allowed by RBI to set up the Trade Receivables Discounting System (TReDS), an electronic platform for facilitating cash flows for MSMEs The TReDS platform connects MSME sellers and their corporate b
Slide 59: Freecharge continues to progress in payments led financial services
Freecharge continues to make progress in its payments led financials services journey; Initial response to “Buy Now Pay Later” encouraging Freecharge Paylater Merchant payment solutions product continues to show strong momentum 4412 DTH, MOBILE LOANS CARDS CA/SA/FD UTILITIES RECHARGES 2375 Q1 FY22 •
Slide 60: Other important information
Executive Summary Financial Highlights Capital and Liquidity Position Business Segment performance Asset Quality Future of Work and Sustainability Subsidiaries’ Performance Other important information Quarterly Results Q1 FY22 60
Slide 61: Differentiated identity and among most valuable Brands in India
We have created a differentiated identity and are amongst the most valuable Brands in India Featured amongst Top 20 most valuable brands in India Axis Bank Mobile App Store Rating 4.6 2018 Global Rank #14 4.5 vs. #32 in 2017 People’s Choice Among 42 leading banks worldwide Quarterly Results Q1 FY22
Slide 62: Major awards won by the Bank and its subsidiaries
Major awards won by the Bank and its subsidiaries ‘Most Recommended Retail Ranked no 1 in Corporate Bank in India’ and Most Helpful Banking Quality in India Best Digital Bank India 2021 Bank during Covid-19 in India Best Cyber Security Project, Anti-Money Laundering Best Use of IT in Risk Best Finan
Slide 63: Shareholding Pattern (as on June 30th, 2021)
Shareholding Pattern (as on June 30th, 2021) SUUTI Others GDR's 1.52% 7.67% 2.55% General Insurance Corp & other promoters 1.89% Life Insurance Corporation 7.99% Foreign Institutional Investors 55.44% Indian Institutions 22.94% ➢ Share Capital `613 crores ➢ Shareholders’ Funds `103,890 crores ➢ Book
Slide 64: Financial Performance
Financial Performance Financial Performance (₹ crores) Q1FY22 Q1FY21 % Growth Interest Income A 16,003 16,445 (3%) Other Income B = C+D+E 3,588 2,587 39% - Fee Income C 2,668 1,652 62% - Trading Income D 499 622 (20%) - Miscellaneous Income E 421 313 34% - Recoveries in written-off a/c’s 287 228 26%
Slide 65: Financial Performance ($ mn)
Financial Performance Financial Performance ($ mn) Q1FY22 Q1FY21 % Growth Interest Income A 2,153 2,212 (3%) Other Income B = C+D+E 483 348 39% - Fee Income C 359 222 62% - Trading Income D 67 84 (20%) - Miscellaneous Income E 57 42 34% - Recoveries in written-off a/c’s 39 31 26% Total Income F = A+
Slide 66: Balance Sheet
Balance Sheet Balance Sheet As on 30th Jun’21 As on 30 Jun’20 As on 30th Jun’21 As on 30th Jun’20 % Growth CAPITAL AND LIABILITIES In ` Crores In ` Crores in $ Mn in $ Mn Capital 613 564 82 76 9% Reserves & Surplus 1,03,277 85,507 13,894 11,504 21% Deposits 7,13,862 6,15,655 96,040 82,827 16% Borrow
Slide 67: Safe Harbor
Safe Harbor Except for the historical information contained herein, statements in this release which contain words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “futu
Slide 68: Thank You
Thank You Quarterly Results Q1 FY22 68