Capri Global Capital Limited · NSE:CGCL
Capri Global Capital — Q3 FY2020 Earnings Presentation
46 slides from Capri Global Capital's earnings presentation, Feb 11, 2020
Slide 1: Capri Global Capital Limited – Simpler, Better, Faster
CAPRI GLOBAL ◄ D► CAPITAL LIMITED Simpler, Better, Faster February 11, 2020 The Secretary The Secretary BSE Limited National Stock Exchange of India Limited Pheeroze Jeejeebhoy Towers Exchange Plaza, 5 th Floor Dalal Street, Fort Plot No- 'C' Block, G Block Mumbai - 400 001 Bandra-Kurla Complex, Ban
Slide 2: Q3FY20 & 9MFY20 Earnings Presentation
s Q3FY20 & 9MFY20 Earnings Presentation 11th February 2020
Slide 3: Disclaimer
Disclaimer This presentation is for information purposes only and does not constitute an offer, solicitation or advertisement with respect to the purchase or sale of any security of Capri Global Capital Limited (the “Company”) and no part of it shall form the basis of or be relied upon in connection
Slide 4: Capri Global Capital: An Introduction
Capri Global Capital: An Introduction A diversified Non-Banking Financial Company (NBFC) with presence across high growth segments like MSME, Construction Finance, Affordable Housing and Indirect Retail Lending segments Promoted by first generation entrepreneur, Mr. Rajesh Sharma, Capri Global C
Slide 5: Executive Summary: Emerging as a Stronger Institution
Executive Summary: Emerging as a Stronger Institution Journey Begins Building an Credibility Institution 2011 2016 2019 o AUM of ~INR o Forayed into 200 Bn with a Housing CAGR of 35%+ Finance o Expanding our o Raised Capital of INR o Branch reach to the 4.45 Bn network underserved and o Branch netwo
Slide 6: Branch Network Expansion; Adopting Low Cost Hub & Spoke Model
Branch Network Expansion; Adopting Low Cost Hub & Spoke Model Area Managers - Sales - Branch Manager - Credit - Relationship Mangers (DSTs) - Operations - Credit Resource Hub - FCU , Legal Spoke Technical and - Direct connect Collections with customers - Spoke branch functions Benefits of Hub & Spok
Slide 7: Well Capitalized Business Model: Aid to Expansion
Well Capitalized Business Model: Aid to Expansion Current Assets (INR Mn) Capital Adequacy (%) 79.7 1,691 53 1,344 1,055 39.3 38.4 34.5 825 567 415 483 181 114 104 FY16 FY17 FY18 FY19 9MFY20 FY16 FY17 FY18 FY19 9MFY20 Investments Cash Equivalents Comfortable liquidity Average quarterly Optimal cash
Slide 8: Guidance: Adopting a Safer Approach
Guidance: Adopting a Safer Approach FY20 GUIDANCE Cautious lending approach during FY20 Total AUM target at INR ~42,000 Mn. • The Company has maintained a cautious Focused on optimizing operational efficiency; stance on disbursement in CF & IRL segment leading to PAT growth of ~25% YoY in FY20. and
Slide 9: Q3FY20 Review: Building Business Strength
Q3FY20 Review: Building Business Strength Managing liquidity for stronger Focusing on operating Cautious lending and loan Q4FY20 efficiencies sourcing approach • Addition of new bank lines • Optimised Operational structure • Cautious approach in CF lending: of INR 8,100 Mn in 9MFY20; by implementing
Slide 10: Q3FY20 & 9MFY20 Performance and Analysis
Q3FY20 & 9MFY20 Performance and Analysis 9
Slide 11: Capri Global Capital: Banking The Unbanked
Capri Global Capital: Banking The Unbanked 9MFY20 At A Glance Total AUM* INR 39.45 billion MSME AUM 21,500 + Live Accounts INR 19.94 billion CF + IRL AUM INR 10.84 billion 1500+ Employees HL AUM INR 8.68 billion 8 States Total Disbursements INR 7.98 billion 85 PAT Branches INR 1.26 billion Net Worth
Slide 12: Q3FY20: At a Glance..
Q3FY20: At a Glance.. Consolidated numbers NII (INR MN) PAT (INR MN) AUM (INR MN) 983 39,451 496 352 851 36,824 Q3FY19 Q3FY20 Q3FY19 Q3FY20 Q3FY19 Q3FY20 Capital Adequacy Ratio* (%) Gross NPA (%) Net NPA (%) MSME + CF + IRL HF MSME + CF + IRL HF 38.4% 3.00 1.60 1.45 1.32 2.30 1.98 37% 0.55 0.23 Q3FY
Slide 13: Q3FY20: Key Highlights
Q3FY20: Key Highlights Consolidated numbers AUM - Segmental Breakup Disbursements - Segmental Portfolio Yield (%) (INR Mn) Breakup (INR Mn) 18.6% 16.8% 16.3% 2,074 15.3% 15.5% 19,936 14.5% 14.1% 18,223 13.1% 1,739 1,595 1,380 11,525 1,147 10,448 8,678 6,154 440 922 389 30 - Q3FY19 Q3FY20 Q3FY19 Q3FY
Slide 14: 9MFY20: Key Highlights
9MFY20: Key Highlights Consolidated numbers NII (INR MN) PAT (INR MN) Cost – Income (%) 1,262 2,931 49 2,288 868 39 9MFY19 9MFY20 9MFY19 9MFY20 9MFY19 9MFY20 Book Value Per Share (Rs.) Return on Assets (% annualized) Return on Net Worth (% annualized) 3.98 11.66 85.8 8.90 76.7 3.40 9MFY19 9MFY20 9MF
Slide 15: Q3FY20: Performance Summary
Q3FY20: Performance Summary All amounts in INR Mn except stated Particulars Q3FY20 Q3FY19 Y-o-Y (%) Q2FY20 Q-o-Q (%) Interest Earned 1,686 1,437 17% 1,724 (2%) Interest Expense 703 586 20% 712 (1%) Net Interest Income 983 851 16% 1,012 (3%) Net Interest Margin (NIM)% 10.0% 9.5% 0.5% 10.1% (0.1%) PAT
Slide 16: Stable Asset Quality: Stage Analysis As per IND-AS
Stable Asset Quality: Stage Analysis As per IND-AS All amounts in INR Mn except stated ECL Analysis as per INDAS Q3FY20 Q2FY20 Q1FY20 Stage 1 & 2 - Gross 38,347 38,679 40,144 Stage 1 & 2 – ECL Provisions 226 207 204.6 Stage 1 & 2 – Net 38,121 38,471 39,940 Stage 1 & 2 – ECL Provisions % 0.59% 0.54%
Slide 17: Asset-Liability Split: Consistent Mix
Asset-Liability Split: Consistent Mix All amounts in INR Mn 31st December, 2019 31st March, 2019 19,789 18,104 19,405 19,044 ❖ Have consistently 20,959 13,180 14,327 13,747 16,098 remained cautious about 15,481 short-term asset & 11,063 liability mismatches by ensuring optimally 7,058 matched Balanc
Slide 18: Liability Mix: The Low Cost Benefit
Liability Mix: The Low Cost Benefit Total Borrowings (INR Mn) & Borrowing Mix Higher Share of Bank Borrowing >> Lower Overall Cost of Borrowing 7,280 15,661 27,687 26,995 26,995 25,736 ▪ Nil exposure to short-term money market signifies no probability of default 97% 100% ▪ CGCL’s prudence in higher
Slide 19: NPA Analysis: Prudent Lending Practises
NPA Analysis: Prudent Lending Practises CGCL (Standalone) FY16 FY17 FY18 FY19 (INR MN) GNPA Product Segment wise – Q3FY20 NPA Recognition 150 DPD 120 DPD 90 DPD 90 DPD Norms GNPA 97 178 439 560 Product Segment GNPA % NNPA % NNPA 83 152 374 202 MSME 4.59% 2.82% Provisions 14 26 64 358 Total Assets 13
Slide 20: Small Loans: Niche Capabilities
Small Loans: Niche Capabilities MSME Construction Finance Housing Finance Indirect Lending ~ 51 % of AUM ~ 27 % of AUM ~ 22 % of AUM < 1 % of AUM • Focus on Tier II & III • Project outreach: 140 • Affordable housing • NBFC Outreach: 7 cities; Customer • Key markets: customers in Tier II & • Financin
Slide 21: Annexure: About CGCL & Industry Scenario
Annexure: About CGCL & Industry Scenario 20
Slide 22: Capri Global Capital In a Nutshell
Capri Global Capital In a Nutshell An upcoming Diversified NBFC with OUR MISSION OUR BUSINESS MODEL presence across high growths segments ‘Our mission is to shape this future • Small-ticket, retail-focused like MSME, Construction Finance, and create a solid social impact segments: MSME financing,
Slide 23: Business Overview: Diversified Portfolio
Business Overview : Diversified Portfolio Our Solutions and Offerings MSME Finance Construction Finance Housing Finance o Cash flow-based lending to self employed o Home Loan for purchase of o Construction Finance/Project Finance, Cash MSME for Business loan against ready/under-construction resident
Slide 24: CGCL Advantage: What Sets us Apart
CGCL Advantage: What Sets us Apart 1 Focus on SENP Borrower 4 Multi Layered Credit Approach o Strong focus on self employed non-professional borrower; carved o Customized underwriting approach basis the customer’s out a niche in this segment. profile; Credit team personally spends time with customer
Slide 25: MSME Lending: A Huge Unexplored Opportunity
MSME Lending: A Huge Unexplored Opportunity The NBFC Advantage in MSME Funding MSME credit to grow at 12-14% over 5 years: ICRA ▪ Lack of formal avenues for financing ensures low Non-bank share in MSME credit pie should penetration from banks expand to 22-23% by March 2022 vs 16% in March 2017: ICRA
Slide 26: MSME: Small Loans, Big Opportunity
MSME: Small Loans, Big Opportunity Focus Area MSME Assets by Geography 2% 9% 2% Delhi NCR 33% Maharashtra 14% Gujarat Micro Enterprise Small Enterprise MP • Self Employed Individuals – • Small enterprises with Rajasthan Provision stores, retail formal income Punjab outlets, handicrafts etc documenta
Slide 27: MSME: CGCL's Growth Driver
MSME: CGCL’s Growth Driver Disbursals (INR Mn) Live Accounts 7,910 7,720 11,889 11,051 6,100 3,380 FY18 FY19 9MFY20 FY18 FY19 9MFY20 Direct Sourcing (AUM) 73% 78% 55% FY18 FY19 9MFY20 26
Slide 28: Affordable Housing: Large Demand & Low Formal Financing
Affordable Housing: Large Demand & Low Formal Financing Housing Shortage Urban Housing shortage pegged to reach 34.1 million 43.7 96% shortage in units by 2022 EWS & LIG 95%+ of the shortage corresponds to Lower Income LIG, 40% 18.8 Group (LIG) & Economically Weaker Sections (EWS) EWS, 56% In 2015,
Slide 29: Housing Finance: Capitalising on Affordable Housing Opportunity
Housing Finance: Capitalising on Affordable Housing Opportunity Focus Area HF Lending Portfolio by Geography • Serves middle and lower middle income population in Tier 2 and 3 cities 12% • Ventured in 2016 through its subsidiary 36% Maharashtra – Capri Global Housing Finance Limited 18% Gujarat Delh
Slide 30: Housing Finance: Exponential Growth Potential
Housing Finance: Exponential Growth Potential Disbursals (INR Mn) Live Accounts 8,637 9,485 5,090 2,404 1,780 2,621 FY18 FY19 9MFY20 FY18 FY19 9MFY20 Portfolio Yield (%) 14.1% 13.4% 12.0% FY18 FY19 9MFY20 29 Note: FY18 was the 1st full year of operations
Slide 31: Urban Construction Finance: Significant Scope of Growth
Urban Construction Finance: Significant Scope of Growth Recent Government Initiatives to promote affordable Demand Drivers for Growth in Indian Mortgage Market housing construction • 100% tax exemption on affordable housing • 66% of India’s population is aged below 35 years, construction projects fo
Slide 32: Construction Finance: The Retail Way
Construction Finance: The Retail Way • Exposure to Mumbai region at 23 % Addressing Concentration • Reduced average interest rates to in 9MFY20 vs 69% in FY16 Risk target larger developer audience • New geographies added in past 2 • Aim to specialize in small ticket years: Ahmedabad, Chennai, constr
Slide 33: Construction Finance: Building a Sustainable Future
Construction Finance: Building a Sustainable Future Focus Area CF Lending Portfolio by Geography 2% 1% • Construction linked loans to small and 3% midsize real estate developers 2% 6% Mumbai 23% Pune • Comprehensive framework for project Bangalore selection and credit appraisal 9% Ahmedabad Delhi-NC
Slide 34: Construction Finance: High Yield, Low Risk
Construction Finance: High Yield, Low Risk Disbursals (INR Mn) Number of projects 8,860 146 140 8,240 98 2,820 FY18 FY19 9MFY20 FY18 FY19 9MFY20 Portfolio Yield (%) 18.6% 17.2% 16.0% 33 FY18 FY19 9MFY20
Slide 35: Indirect Retail Lending: Unique Product Offering
Indirect Retail Lending: Unique Product Offering` Focus Area AUM Disbursements Lending to small NBFCs engaged in INR 389 Mn - o MSME Lending and Microfinance o Two Wheelers and Commercial Vehicles finance Hypothecation of receivables - 1 to Ticket Size Range Customers 1.2X cover INR 50-250 Mn 7
Slide 36: Over the Years…
Over the Years… Net Interest Margin (%) Pre-Tax RoCE (%) Spread (%) 12.5 6.2 5.6 5.7 14.8 5.1 4.9 9.2 9.5 11.6 8.5 9.3 9.3 9.7 5.7 FY16 FY17 FY18 FY19 9MFY20 FY16 FY17 FY18 FY19 9MFY20 FY16 FY17 FY18 FY19 9MFY20 Return on Equity (%) Cost to Income Ratio (%) Return on Assets (%) 11.7 52 48 3.8 4.0 10
Slide 37: Over the Years…
Over the Years… NII (INR Mn) PAT (INR Mn) 3,236 1,357 2,931 1,262 2,252 1,495 1,671 659 581 436 FY16 FY17 FY18 FY19 9MFY20 FY16 FY17 FY18 FY19 9MFY20 Total Assets (INR Mn) Capital Adequacy (%) 42,770 41,732 79.7 29,710 53 19,861 39.3 38.4 34.2 13,204 FY16 FY17 FY18 FY19 9MFY20 FY16 FY17 FY18 FY19 9M
Slide 38: Retail focussed model aiding to strong Asset quality
Retail focussed model aiding to strong Asset quality MSME Average Ticket Size (In Mn) Construction Finance Average Ticket Size (In Mn) Housing Finance Average Ticket Size (In Mn) 4.3 277 1.5 2.6 1.1 1 1.5 99.2 80 FY17 FY18 FY19 FY17 FY18 FY19 FY17 FY18 FY19 MSME GNPA (%) Construction Finance GNPA (%
Slide 39: Growing At a Superior Pace
Growing At a Superior Pace Disbursement Mix (INR Mn) AUM Mix (INR Mn) MSME CF IL HL MSME CF IL HL 8,860 8,240 19,710 7,915 7,720 7,230 15,413 5,990 5,090 12,027 12,010 4,760 9,427 7,484 7,930 3,058 2,922 5,999 2,108 2,080 … 4,415 1,600 1,100 3,113 2,450 1,100 1,390 65 65 FY15 FY16 FY17 FY18 FY19 FY1
Slide 40: Income Statement- Quarterly Comparison
Income Statement- Quarterly Comparison INR Mn Q3FY20 Q3FY19 Y-o-Y(%) Q2FY20 Q-o-Q(%) Interest earned 1,686 1,437 17% 1,724 (2%) Interest expanded 703 586 20% 712 (1%) Net interest income 983 851 16% 1,012 (3%) Non-interest income 143 158 (9%) 80 79% - Fee and Commission income 91 126 (28%) 63 44% -
Slide 41: Income Statement
Income Statement INR Mn 9MFY19 9MFY20 Y-o-Y(%) Total interest earned 3,735 5,046 35% Total interest expanded 1,447 2,115 46% Net interest income 2,288 2,931 28% Non-interest income 402 328 (18%) - Fee and Commission income 326 225 (31%) - Other Income 76 103 36% Total Income 2,690 3,260 21% Operatin
Slide 42: Balance Sheet
Balance Sheet INR Mn 9MFY19 9MFY20 Y-o-Y (%) Share Capital 350 350 0% Reserves and Surplus 13,087 14,683 12% Networth 13,438 15,033 12% Borrowings 24,089 25,736 7% Other Liabilities and Provisions 1,071 962 (10%) Total liabilities & stockholders' equity 38,598 41,732 8% Net Block 135 328 143% Invest
Slide 43: Leadership Team
Leadership Team Surender Sangar Vikas Sharma Ashish Gupta Hemant Dave Head – Construction Finance Business (HL) and Collections Head Chief Financial Officer Head of Operations Ex-MD – Tourism Finance Corporation of Ex - Kotak Mahindra Bank, Dhanlaxmi Ex - Jindal Stainless, Isolux, Ex - Kotak Mahindr
Slide 44: Board of Directors
Board of Directors Rajesh Sharma Ajay Kumar Relan Bhagyam Ramani Managing Director Independent Director Independent Director Founder & promoter Founder CX Partners & Citi Ex- GM and Director of General Over 23 years of experience Bank N.A. in India, Insurance Corporation Chartered Accountant Over 4
Slide 45: Key Partnerships
Key Partnerships Lenders Auditors & Advisors 44
Slide 46: Thank You
Thank You For further information, please get in touch with: Hardik Shah Hardik.shah@capriglobal.in T: +91 22 4088 8126 Sheetal Khanduja sheetal@GoIndiaAdvisors.com M:+91 97693 64166 Rajat Gupta rajat@GoIndiaAdvisors.com M:+91 9971897739
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