Mas Financial Services Ltd. · NSE:MASFIN
Mas Financial Services — Q1 FY25 Earnings Presentation
55 slides from Mas Financial Services's earnings presentation, Jul 24, 2024
Slide 1: Cover letter to stock exchanges
MFSL/SEC/EQ/2024/70 July 24, 2024 To, To, The Manager, General Manager BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers Exchange Plaza Dalal Street Plot No. C/1, G Block Mumbai – 400001 Bandra-Kurla Complex Bandra (East) Mumbai – 400051 Scrip Code: 540749, 947381 Tradin
Slide 2: Investor Presentation – Q1FY25
INVESTOR PRESENTATION – Q1FY25 2023-24 1995-96
Slide 3: Disclaimer
Disclaimer This presentation has been prepared by and is the sole responsibility of MAS Financial Services Limited (together with its subsidiary MAS Rural Housing & Mortgage Finance Limited). By accessing this presentation, you are agreeing to be bound by the trailing restrictions. This presentation
Slide 4: MAS Raised ₹500 Crores Through QIP
A SANGRE SERVERS or \ The Power of Distribution | MAS Raised ¥500 Crores Through QIP to Strengthen Capital Base for Future Growth First equity raise by the Company since its IPO in 2017 Overwhelming response resulting in demand of multiple times over the issue size. Allocation to marquee diversified
Slide 5: Table of Contents
Table of Contents 1 MAS AT A GLANCE 05 2 GROWTH STORY 07 3 STRONG FUNDAMENTALS 11 4 STANDALONE FINANCIAL REVIEW 18 5 MAS RURAL HOUSING & MORTGAGE FINANCE LIMITED - SUBSIDIARY 27 6 FOCUS ON ENVIRONMENT, SOCIAL, & GOVERNANCE (ESG) 33 MAS Financial Services Limited 7 UNDERSTANDING MAS 39 8 WAY FORWARD
Slide 6: MAS at a Glance (Standalone)
MAS at a Glance (Standalone) MAS Financial Services was established in 1995 with an objective: “To address the financial needs of the underserved segments of the country” 25+ Diversified Product Portfolio Years of Endeavours Micro Enterprise Loans SME Loans 1,03,836 Mn ₹ 13 193 Standalone AUM States
Slide 7: Strong Distribution Network
Strong Distribution Network MAS has steadily entered adjacent geographies 1 Punjab 1 Uttarakhand 193 1 Haryana 1 Delhi 41 1 Uttar Pradesh Branches Rajasthan 62 42 Gujarat Madhya Pradesh 1 Chhattisgarh Pan India Network presence Maharashtra through 29 MAS Financial Services Limited 1 177 7 Telangana
Slide 8: Growth
GROWTH Belief & Philosophy CONSISTENTLY AND STEADILY IS THE FASTEST WAY TO REACH WHERE YOU WANT TO
Slide 9: Journey of Quarters
Journey of 116 Quarters Asset Under Management (AUM) 1,01,256 (In ₹ Mn) 80,926 62,468 53,384 59,663 53,724 41,570 31,561 25,650 20,052 10,123 13,910 2,312 2,597 2,682 3,884 5,118 6,909 20 1,510 4Q 44Q 48Q 52Q 56Q 60Q 64Q 68Q 72Q 76Q 80Q 84Q 88Q 92Q 96Q 100Q 104Q 108Q 112Q 116Q Profit After Tax (PAT)
Slide 10: Growing Consistently and Steadily
Growing Consistently and Steadily - Our Growth Journey of Last 17 Years Since Our First Capital Raise… Despite various micro and macro headwinds Track record of high-quality portfolio with Net Maintained healthy return on assets including demonetisation, GST, NBFC Stage 3 Assets below 2% over the pe
Slide 11: Best-in-Class Asset Quality Across Cycles
Best-in-Class Asset Quality Across Cycles and Resilience Through Systematic Shocks Catalyst in growth of entrepreneurs, not creating just borrowers GROSS STAGE 3 ASSETS NET STAGE 3 ASSETS 7.2% 6.4% 2nd Wave 1st Wave 2.30% 2.35% 2.28% 2.27% 2.26% 2.29% 2.21% 2.23% 2.17% 2.23% 2.25% 2.15% 2.13% 1.94%
Slide 12: Strong Fundamentals
Strong Fundamentals
Slide 13: Diversified Product Offerings
Diversified Product Offerings Presenting Significant Growth Opportunities MAS focuses on serving the underserved credit needs of mid and low-income group segments Micro-Enterprise Loans SME Loans Two-Wheeler Loans Commercial Salaried Vehicle Loans Personal Loans 45,234 Mn 37,839 Mn 6,686 Mn 8,173 Mn
Slide 14: AUM by Product Category
Asset Under Management – by Product Category (In ₹ Mn.) Micro-Enterprise loans(MEL) SME loans 2-Wheeler loans Commercial Vehicle loans Salaried Personal Loans 1,03,836 1,01,256 5,904 5,889 7,477 8,173 84,178 80,926 6,686 6,701 3,026 3,049 4,484 3,725 5,709 5,544 62,468 37,339 37,839 3,452 3,774 30,7
Slide 15: AUM by Product Category Jun 24 vs Jun 23
Asset Under Management – by Product Category (In ₹ Mn.) Jun 24 vs. Jun 23 Micro Enterprise Loans SME Loans Two Wheeler Loans Commercial Vehicle Loans Salaried Personal Loans* 12.49% YoY 23.06% YoY 17.13% YoY 82.28% YoY 95.11% YoY 45,234 40,212 37,839 8,173 MAS Financial Services Limited 6,686 30,748
Slide 16: AUM Distribution Channel Wise
Asset Under Management – Distribution Channel Wise Increasing share of Direct Retail Distribution (%) 38 33 37 34 48 62 67 63 66 52 MAS Financial Services Limited Mar-22 Mar-23 Mar-24 Jun-23 Jun-24 (₹ Mn) AUM 62,468 80,926 1,01,256 84,178 1,03,836 Retail Asset Channel Direct Retail Distribution 15
Slide 17: Leveraging Technology
Leveraging Technology MAS is integrating technology across all verticals of its operations Collaboration with 45+ APIs, enabling authentic data sourcing Origination Decisioning Operations Disbursement & Collection • Centralised onboarding and OTP • Pre-set rule engines to determine credit • Remote a
Slide 18: Strong Liability Management
Strong Liability Management The composition of our The Company continues to Sources of fund as on June 30, 2024 (%) liability mix ensures healthy demonstrate its capability of ALM and well diversified efficient liability management resource mix. The cashflow in all the cumulative buckets Around 85%
Slide 19: Standalone Financial Review (Q1FY25)
Standalone Financial Review (Q1FY25)
Slide 20: Key Highlights – Q1 FY25
Key Highlights – Q1 FY25 Asset Under Management (AUM) Profit After Tax (PAT) Return on Avg. Net Worth*^ ₹1,03,836Mn 23.35% (Q1 FY24: ₹84,178 Mn) ₹ 704 Mn 23.02% (Q1 FY24: ₹573 Mn) 16.90% Return on Avg. Balance Sheet Assets* Net Interest Income (NII) Cost of Borrowing* (COB) 2.98% 1,751 Mn 27.46% 15b
Slide 21: Financial Performance – Q1 FY25
Financial Performance – Q1 FY25 Assets Under Management (AUM) (In ₹ Mn) Net Worth (In ₹ Mn) On & Off Book AUM (%) 23.35% 47.92% 23,340 1,01,256 1,03,836 17,690 19 19 22 21 22 80,926 84,178 15,779 15,057 13,406 62,468 81 81 78 79 78 Mar-22 Mar-23 Mar-24 Jun-23 Jun-24 Mar-22 Mar-23 Mar-24 Jun-23 Jun-2
Slide 22: Financial Performance – Q1 FY25
Financial Performance – Q1 FY25 Revenue (In ₹ Mn) Net Interest Income (NII) (In ₹ Mn) 12,293 6,151 9,399 4,650 23.71% 27.46% 6,571 3,375 2,801 3,465 1,373 1,751 FY22 FY23 FY24 Q1FY24 Q1FY25 FY22 FY23 FY24 Q1FY24 Q1FY25 Operating Expense (In ₹ Mn) Profit After Tax (PAT) (In ₹ Mn) 2,478 MAS Financial
Slide 23: Financial Performance – Q1 FY25
Financial Performance – Q1 FY25 Optimized cost structure Operating Expense Ratio* Operating Expense as % of NII Operating Expense as % of Gross Income 31.68% 31.56% 31.10% 32.41% 2.13% 2.21% 2.05% 2.07% 27.30% 15.68% 15.79% 16.37% 15.25% 14.02% 1.59% FY22 FY23 FY24 Q1FY24 Q1FY25 FY22 FY23 FY24 Q1FY2
Slide 24: Financial Performance – Q1 FY25
Financial Performance – Q1 FY25 Strongly Capitalized Debt Equity Ratio Capital Adequacy Ratio 3.92 4.00 3.79 28.59% 26.35% 25.25% 25.31% 3.39 24.05% 3.08 Mar-22 Mar-23 Mar-24 Jun-23 Jun-24 Mar-22 Mar-23 Mar-24 Jun-23 Jun-24 Healthy Coverage Interest Coverage Ratio MAS Financial Services Limited 1.66
Slide 25: Asset Under Management – Credit Quality – DPD
Asset Under Management – Credit Quality 1 – 30 DPD 31 – 60 DPD 61 – 90 DPD 91 –120 DPD > 120 DPD 1.67% 1.53% 1.43% 1.67% 1.59% 1.65% 1.69% 0.63% 0.70% 0.81% 0.48% 0.52% 0.85% 0.54% 0.58% 0.49% 0.57% 0.75% 0.79% 0.51% 0.82% 1.06% MAS Financial Services Limited 1.13% 0.86% 0.86% 1.01% 0.88% 0.87% 2.21
Slide 26: Credit Quality
Credit Quality (In ₹ Mn.) Jun-24 Jun-23 Particulars Jun-24 Jun-23 Particulars AUM Provision AUM Provision Gross Stage 1 And Stage 2 Assets As % Of On Book Assets 97.46% 97.97% Stage 1 77,307.50 212.55 64,427.51 187.79 Stage 1 & Stage 2 Assets (Standard Assets) Provisioning 0.48% 0.47% Stage 2 1,228.
Slide 27: Financial Statement: FY22 to Q1FY25
Financial Statement: FY22 to Q1FY25 (In ₹ Mn.) PROFIT & LOSS STATEMENT BALANCESHEET STATEMENT Particulars FY 2022 FY2023 FY2024 Q1FY25 Particulars Mar-22 Mar-23 Mar-24 Jun-24 ASSETS Total Revenue 6,571 9,399 12,293 3,465 Financial assets 59,763 75,724 89,772 96,660 Loans 45,538 59,102 72,648 75,259
Slide 28: MAS Rural Housing & Mortgage Finance Limited (MRHMFL) Subsidiary
MAS Rural Housing & Mortgage Finance Limited (MRHMFL) Subsidiary
Slide 29: About MRHMFL
About MRHMFL MAS is targeting affordable housing finance segment through its subsidiary MAS Rural Housing & Mortgage MRHMFL provides loans for MRHMFL provides housing loans in With its continued focus on the rural Finance Limited (“MAS Housing” or purchase of new and old houses, rural and semi-urban
Slide 30: Financial Performance – Q1 FY25
Financial Performance – Q1 FY25 Assets Under Management (AUM) (In ₹ Mn) Net Worth (In ₹ Mn) 34.44% 38.44% 1139 5,963 6,231 1108 4,501 851 847 4,133 3,141 619 Mar-22 Mar-23 Mar-24 Jun-23 Jun-24 Mar-22 Mar-23 Mar-24 Jun-23 Jun-24 Borrowing (In ₹ Mn) Revenue (In ₹ Mn) 3,796 3,973 625 MAS Financial Serv
Slide 31: Financial Performance – Q1 FY25
Financial Performance – Q1 FY25 Profit After Tax (PAT) (In ₹ Mn) Net Interest Income (NII) (In ₹ Mn) 76 299 63 49 212 36.41% 160 36.46% 22 90 16 66 FY22 FY23 FY24 Q1FY24 Q1FY25 FY22 FY23 FY24 Q1 FY24 Q1 FY25 Gross Stage 3 Assets Net Stage 3 Assets MAS Financial Services Limited 0.90% 0.90% 0.66% 0.6
Slide 32: Liability Management
Liability Management Sources of Fund as on 30th June 2024 The composition of our liability mix The Company continues to demonstrate (%) ensures healthy ALM and well diverse its capability of efficient liability resource mix. The cashflow in all the management. cumulative buckets is positive. NHB Ref
Slide 33: Credit Quality
Credit Quality (In ₹ Mn.) Jun-24 Jun-23 Particulars Jun-24 Jun-23 Particulars AUM Provision AUM Provision Stage 1 And Stage 2 Assets As % Of On Book Assets 98.95% 99.22% Stage 1 4,428.71 3.40 3,355.37 3.47 Stage 1 And Stage 2 Assets ( Standard Assets) 0.31% 0.39% Provisioning Stage 2 248.26 10.90 19
Slide 34: Focus on Environment, Social, & Governance (ESG)
E S G Environment Social Governance FOCUS ON ENVIRONMENT, SOCIAL, & GOVERNANCE (ESG)
Slide 35: Environmental Stewardship
Environmental Stewardship MAS endeavours to create awareness The management of MAS Financial amongst all the stakeholders on the Services Limited (MAS) believes in importance of environment conservation Environmentally Conscious approach for & protection. The company also all business & operational
Slide 36: Enhancing Social Impact (1/2)
Enhancing Social Impact (1/2) SHIKSHA PROTSAHAN “Caring for communities is a way ✓ Identified & supported various bright students from more of life” than 30 schools who wish to pursue higher studies ✓ Provided basic infrastructure facilities at many schools ❖ MAS Financial Services Ltd around Ahmeda
Slide 37: Enhancing Social Impact (2/2)
Enhancing Social Impact (2/2) Shiksha Protsahan Anganwadi MAS Financial Services Limited 36 Shiksha Protsahan Welfare of War Widows’
Slide 38: Strict Governance Compliance
Strict Governance Compliance 1 2 3 4 5 6 The management Strict compliance Rich experienced Regular Adequate Board approved of MAS with the Board of the monitoring & processes, policies on Financial regulations of Company continuous operational & IT Corporate Services Limited SEBI, RBI and comprising
Slide 39: Governance Framework
Governance Framework Board of Directors Advisory Committee (6 Directors including 4 Independent Directors) to the Board Committee Chaired by Other Committees Independent Directors MAS Financial Services Limited ֍ Audit Committee ֍ Finance Committee ֍ Risk Management Committee ֍ Credit Committee ֍ St
Slide 40: Understanding MAS
Understanding MAS
Slide 41: About MAS
About MAS VISION MISSION BELIEF To be one of the most efficient To constantly endeavor, to attain excellence and create “We have miles to go & Promises to keep……” distributors of financial services and a very wide Financial distribution network and to be “Together we can and we will” create value on
Slide 42: Visionary Leadership
Visionary Leadership Experienced Promoters Mr. Kamlesh Chimanlal Late Mr. Mukesh Gandhi, 57, is the Chimanlal Gandhi, a Co- One of the founder and former Founder, Chairman, and Managing Director of Director (Finance) at highest promoter MAS Financial Services MAS with over two Limited, brought over
Slide 43: Governance by an Independent Board; Guidance from Industry Leaders
Governance by an Independent Board; Guidance from Industry Leaders Corporate Advisory Committee Mr. Umesh Rajanikant Shah Mrs. Daksha Niranjan Shah Dr. Rajiv Kumar Mr. TT Srinivasaraghavan Independent Director Independent Director Former Vice Chairman of Niti Retd. MD of Sundaram Finance, 3 decades
Slide 44: Robust Risk Management
Robust Risk Management Portfolio & Asset Quality Policies Process • MAS has well diversified products • MAS has comprehensive policies • MAS endeavours to have processes to portfolio and wide geographical presence framework for all the critical functions follow the laid down core policies. (through
Slide 45: Robust Credit Assessment
Robust Credit Assessment MAS aims to give credit where it is due with the dictum of adherence and adaptability Comprehensive Credit Assessment Credit Assessment Process Overview by Product Business loans require A assessment of business viability, cash flow, and profitability Income Profile Salaried
Slide 46: Unique and Robust Distribution Network Through NBFC Partners
Unique and Robust Distribution Network Through NBFC Partners Aim & Our Understanding Impact Efficient last mile delivery of credit across Value chain approach has proven to be MAS NBFCs its product range namely MEL, SME, 2- the most potent one to solve informality • Widens its network while maintain
Slide 47: Sharpening the Learning Curve
Sharpening the Learning Curve Our proven track record of more than ₹24,000 cr cumulative disbursement through NBFC partners with total loss less than 0.50% over a decade across various tough periods assures our confidence on the distribution model. Our Learning Curve is Further Strengthened by Credi
Slide 48: Way Forward
Way Forward
Slide 49: Key Growth Strategies for Consistent Growth
Key Growth Strategies for Consistent Growth – Entering the next phase of growth after crossing an important milestone of ₹ 100 Bn in AUM Focus towards direct lending Growth Drivers Aim to grow AUM by Share of business from direct Housing, SME and Wheels 20% to 25% over the distribution will increase
Slide 50: Enablers for Consistent Growth
Enablers for Consistent Growth Successful Track Record Highly Capitalised Robust Liability Management • Successfully withstood multiple • Highly capitalised for future growth. • Cash & bank balances of ~ ₹12,846 Mn. as headwinds over the years Sufficient capital to continue the growth on 30th June 2
Slide 51: Shareholding Profile
Shareholding Profile
Slide 52: Marquee FIIs and DIIs Shareholders
Marquee FIIs and DIIs Shareholders Shareholding as on 30th June 2024 Marquee Investors (%) Others Foreign Portfolio Investor 9.39% 3.58% Alternate Investment Funds 6.71% MAS Financial Services Limited Domestic Institutions (Mutual Fund & 13.70% Insurance) 66.63% Promoter and Promoter Group 51
Slide 53: Events & Milestones
Events & Milestones
Slide 54: Major Events & Milestones
Major Events & Milestones Note: As per Calendar Year ✓ On incorporation, commenced retail finance operations with ✓ Bank loan rating was upgraded to ‘IND A’ with ‘Stable outlook 1995 Two-wheeler and Micro-Enterprise loans 2016 1995 ✓ Raised subordinate debentures of ₹ 400 Mn ✓ Motilal Oswal infused
Slide 55: Best Wishes
MAS Financial Services Limited Registered Office 6, Ground Floor, Narayan Chambers, Ashram Road, Ahmedabad-380009 www.mas.co.in Investor Contact Best Wishes Mr. Ankit Jain Chief Financial Officer 079-41106682 ankit_jain@mas.co.in Mr. Meet Chande Investor Relations Manager 079-41106551 meet_chande@ma
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