Tata Capital Ltd. · NSE:TATACAP
Tata Capital — 9M FY2023-24 Earnings Presentation
52 slides from Tata Capital's earnings presentation, Feb 21, 2024
Slide 1: Disclosure under Regulation 51 cover letter
February 21, 2024 To, To, The Listing Department The Listing Department BSE Limited, National Stock Exchange of India Ltd., Phiroze Jeejeebhoy Towers, Exchange Plaza, Bandra Kurla Complex, Dalal Street, Bandra (East), Mumbai – 400001 Mumbai – 400051 Dear Sir / Madam, Subject: Disclosure under Regula
Slide 2: Tata Capital Limited Results: 9M FY 2023-24
Tata Capital Limited Results: 9M FY 2023-24
Slide 3: Our Purpose
Our Purpose Responsible financial partner fulfilling India's aspirations 2
Slide 4: Our Purpose Pillars
Our Purpose Pillars 1 2 3 4 5 6 Lead Better Capital Delivering Futuready Faster forward & More with Trust Together Delight We respect and We actively We innovate and We bring speed We serve the We go above and reinforce the collaborate with leverage and simplicity; customer through beyond to care an
Slide 5: Our Vision
Our Vision To be a leading organization on Growth, Shareholder Returns, Customer Experience and be an Employer of Choice 4
Slide 6: Tata Capital: Flagship Financial Services Company of the Tata Group
Tata Capital: Flagship Financial Services Company of the Tata Group INR 1,49,165 Cr 85%+ 681 4.2 Mn Loan book Retail+SME Branches Customers Rated AAA by Crisil, ICRA, CARE, Profitable since inception India Ratings 5
Slide 7: Tata Capital poised to capture the India lending opportunity
Tata Capital poised to capture the India lending opportunity India’s credit penetration is one of the lowest among peers Debt to GDP (%) Growth Potential 70% 119% Huge market opportunity of 138% >INR 500 Lakh Cr 164% 171% Source: RBI’s Sectoral Deployment of Credit; MOSPI’s GDP estimates; World Bank
Slide 8: Our Brand Promise: Count on Us
Our Brand Promise: Count on Us Why Count On Us? Customer centric Research indicated that “delivering on promises” is a key factor for customers to choose a financial services provider. Relevant to our evolved Purpose and values Consolidates internal efforts and drives customer expectations Exudes th
Slide 9: Major milestones in the Tata Capital journey
Major milestones in the Tata Capital journey TCL commences Tata Capital Financial Loan Book crosses INR NBFC operations Services Ltd (TCFSL) Private Equity Funds Rating transition from 1 Lakh Cr mark; in 2007 incorporated raised - $1 bn AA+ to AAA (domestic) Highest ever PAT 2011-13 2007 2010 2018 2
Slide 10: Corporate Structure – Lending business w.e.f. Jan 1st, 2024
Corporate Structure – Lending business w.e.f. Jan 1st, 2024 Tata Capital Ltd.1 (TCL) NBFC – ND - SI 100% Tata Capital Housing Finance Ltd. (TCHFL) HFC Note: Please note that Tata Capital Financial Services Limited, Tata Cleantech Capital Limited and Tata Capital Limited filed the Certified Copy of t
Slide 11: Diversified NBFC serving customers across spectrum
Diversified NBFC serving customers across spectrum Portfolio: INR 1,49,165 Cr Retail portfolio break-up Other Corporate retail 12% 7% Auto 20% SME 23% Retail Mortgages 65% 50% Unsecured 23% 10
Slide 12: … with a deep focus on Retail & SME customers
… with a deep focus on Retail & SME customers 65% Retail 23% SME 12% Corporate 40% 96,224 75,299 68,963 34,534 29% 27,302 26,813 21% 18,406 17,349 15,244 1 Dec'22 Mar'23 Dec'23 Dec'22 Mar'23 Dec'23 Dec'22 Mar'23 Dec'23 Mortgage Loans Unsecured Loans • Channel Finance • Corporate Loans • Home Loan •
Slide 13: Mortgage Loans
Mortgage Loans Mortgage loans include Serving the underserved with Growing steadily through Deep impetus on digital Home Loans, Affordable increased focus on Affordable phygital model with a mix sourcing reducing TAT, Housing Finance & Loan Home Loans and Home Loans of increasing digital sales, incr
Slide 14: Unsecured Loans
Unsecured Loans Unsecured retail loans include Focused growth through Leveraging unified loan Utilizing Data Analytics to Personal Loans, Business organic business by building origination system & deep mine existing customer Loans & Microfinance DIY journeys and leveraging business rule engines to b
Slide 15: Auto Loans
Auto Loans Auto loans include Two- Growing business through Large network of channel Amongst the lowest Wheeler, Used Car, expansion of dealer network, partners & multi-location delinquency levels in Construction Equipment increasing digital presence presence aiding growth of industry for Two-wheele
Slide 16: SME Loans
SME Loans SME Offerings consists of Loans are extended for capital Seamless customer 1st amongst peers to start loans given to SME customers expenditure and working experience through ease offering Factoring as an sourced through direct capital requirements across of documentation and alternative Wo
Slide 17: Corporate Loans
Corporate Loans Consists of loans given to Tailor made solutions for Strong track record Construction corporates via Term Loans, corporates (Structured in cleantech finance Finance focus on Cleantech Finance and Finance, Working Capital with financing of top 8 cities through Construction Finance Fin
Slide 18: Financial Performance (Consolidated)
Financial Performance (Consolidated)
Slide 19: Performance Highlights
Performance Highlights 9M FY24 INR 74,498 Cr INR 1,49,165 Cr INR 6,297 Cr 0.4% INR 2,367 Cr 2.4% 18.5% 39% 34% 37% 20 bps 34% - 40 bps Disbursals Loan Book Income Net NPA PAT RoA RoE INR 53,484 Cr INR 1,11,019 Cr INR 4,580Cr 0.6% INR 1,768 Cr1 2.4%1 18.1%1 SH 9M FY23 1PAT excludes one-time items; Re
Slide 20: Disbursals & Loan Book
Disbursals & Loan Book Disbursals: 39% Y-o-Y Growth1 Loan Book: 34% Y-o-Y Growth 1,49,165 74,498 39% 53,484 119,950 1,11,019 9M FY23 9M FY24 Dec'22 Mar'23 Dec'23 Numbers in INR Cr 1Excludes disbursement for short term products like Channel Finance, Invoice Discounting and Factoring business 19
Slide 21: Asset Quality
Asset Quality Gross Stage III (%) Net Stage III (%) PCR (%) Credit Cost (%) 77% 70% 74% 1.9% 1.7% 1.6% 0.6% 0.4% 0.4% 0.5% 0.3% Dec'22 Mar'23 Dec'23 Dec'22 Mar'23 Dec'23 Dec'22 Mar'23 Dec'23 9M FY23 9M FY24 Total loan loss provisions stood at 2.1% of the loan book as on Dec’23. The same is 1.9x of p
Slide 22: Liability Mix
Liability Mix 6% 6% Diversified funding mix including ECBs as well as 8% 8% public NCDs 39% Well-articulated capital raising plan with a focus on 45% raising more granular, sticky liabilities Maintained adequate liquidity along with a well- managed ALM 47% 41% Credit ratings Rated AAA by Dec'22 Dec'
Slide 23: Financial Performance
Financial Performance Y-o-Y FY23 INR Cr 9M FY23 9M FY24 Growth 74,995 Disbursals 53,484 74,498 39% 1,19,950 Loan book 1,11,019 1,49,165 34% 7,036 NIM + Other Revenue 4,580 6,297 37% 2,664 Operating expenses 1,859 2,600 40% 582 Credit cost 360 304 (15%) 3,790 Profits before tax 2,361 3,393 44% 3,029
Slide 24: Well positioned for long-term Success
Expanding footprint in Tier II cities & beyond Well Expanding reach across mediums positioned Digital @ heart of our transformation for long-term Analytics across Customer life cycle Success Strong risk culture embedded across organization Synergies from diversified Tata ecosystem
Slide 25: Expanding footprint in Tier II cities & beyond
Expanding footprint in Tier II cities & beyond Rapidly expanding branch Chandigarh 3 1 Jammu & Kashmir presence over the last 3 years 1 Himachal Pradesh Punjab 8 5 Uttarakhand 65 Uttar Pradesh Haryana 26 4 Assam 4.6x Delhi/NCR 12 58 Bihar Rajasthan 48 681 Gujarat 38 438 Madhya Pradesh 25 267 148 9 W
Slide 26: Expanding reach across mediums
Expanding reach across mediums Television Social and Digital BUSINESS HOME LOAN LOAN BRAND FILM PERSONAL LOAN TWO WHEELER Print LOAN OOH Delhi - R K Puram Pune - Hinjewadi Mumbai - Worli Sea Link Times of India Dainik Bhaskar 25 #KhoobsuratChinta
Slide 27: Education loans: Empowering dreams, Nurturing future
Education loans: Empowering dreams, Nurturing future We have launched ‘Education Loans’ to enable students to pursue higher education, both in India & abroad incl. USA, Canada, UK, Ireland, Australia, New Zealand, Germany, Singapore and Dubai (UAE) Targeted at students who Tata Capital aims to align
Slide 28: 'Digital' @ heart of our transformation
Digital @ Tata Capital ‘Digital’ @ heart of our transformation Reimagining Bringing delight Rethinking how Simplifying partner Embracing ecosystems customer experience to service we operate journeys for growth Enabling unified Gen AI powered bot Using intelligent ‘Smart Assist’ platform Leverage par
Slide 29: Digital as a Business catalyst
Digital @ Tata Capital Digital as a Business catalyst 2.5x Y-o-Y growth in web traffic through optimized webpages Enhanced Pre-approved offers; 20 Lakhs+ offers monthly Significant growth in mobile app downloads Digital tools & enablers for faster & efficient customer Segment based customer & channe
Slide 30: Digital as an Efficiency enabler
Digital @ Tata Capital Digital as an Efficiency enabler Underwriting Collections Data & AI/ML led allocation strategy: pre-delinquency Data from source via APIs enabling rule-based underwriting management, delinquency recovery – 40 models used across collections management Banking Analysis: Account
Slide 31: Digital as an Experience driver
Digital @ Tata Capital Digital as an Experience driver Customer Channel New age Digital Experience: Upgraded to Modern UI including dark mode Agent Productivity: Paperless workflow management Omni-Channel Presence: Website, App, WhatsApp, IVR, SMS (link- for agents based loan service) Convenient Sup
Slide 32: Retail: Seamless digital experience
Digital @ Tata Capital Retail: Seamless digital experience Efficiency at its core: “Building Reliable and scalable Online Platforms” Loan & wealth App Customer Portal Encompassing… 165+ Services 25+ Customer journeys Scan to download 15+ Product offerings Digital Onboarding Customer friendly Journey
Slide 33: Retail: Instant Unsecured Loan journey
Digital @ Tata Capital Retail: Instant Unsecured Loan journey 32
Slide 34: Retail: Scaling up Account Aggregator based use case
Digital @ Tata Capital Retail: Scaling up Account Aggregator based use case ~ 0.5Mn Account aggregator registrations through different products in last 2 years Home Business Loan Loan Personal Channel Loan Finance 33
Slide 35: Retail: Customer experience redefined
Digital @ Tata Capital Retail: Customer experience redefined Dashboard Categorized Service Requests Profile update Service Requests 34
Slide 36: One Stop Digital Solution for all financial needs
Digital @ Tata Capital One Stop Digital Solution for all financial needs Invest • Mutual Funds • Small Case Quick KYC & Onboarding • Corporate FDs • Bonds • Stocks Track transactions Bill Pay • Utilities • Subscriptions • Recharges • Taxes 360 portfolio view • EMI Payments Borrow On Call Assistance
Slide 37: SME & Corporate: Seamless digital experience
Digital @ Tata Capital SME & Corporate: Seamless digital experience Efficiency at its core: “Building Reliable and scalable Online Platforms” SME & Corporate App Customer Portal Encompassing… 100+ Services 20+ Customer journeys Scan to download 15+ Product offerings Digital Onboarding Scorecard asse
Slide 38: SME & Corporate: Loan Origination System 2.0
Digital @ Tata Capital SME & Corporate: Loan Origination System 2.0 Sales Multiple API Digital Multiple Customer DIY integration - KYC product/facility Journey PAN, GST, CIN offering ability enablement Credit underwriting Third party integration – Automated Data enrichment eligibility calculation Co
Slide 39: SME & Corporate: Superior customer experience
Digital @ Tata Capital SME & Corporate: Superior customer experience Instant Drawdown Additional & Disbursal Limits Activation Digitized service journeys End to end architecture including available for all SME & internal processes to maximize View Loan Transaction & Update Stock & Corporate products
Slide 40: Analytics across customer lifecycle
Analytics across customer lifecycle Acquisition & Cross-sell Better conversion Leads from Prospect Pre-approved Segmentation and pricing existing base Marketing offers and profitability & group models ecosystem Improve cross-sell & Products per Customer Underwriting & Disbursement Decision Decision
Slide 41: Strong Risk culture embedded across organization
Strong Risk culture embedded across organization Strong risk management framework, with rigorous oversight, multiple layers of defense, robust through-the- cycle credit risk framework supplemented by data analytics capabilities Agile & responsive risk function fostering a strong risk culture across
Slide 42: Synergies from diversified Tata Ecosystem
Synergies from diversified Tata Ecosystem Tata Capital, as the flagship financial services of the Group, plays a pivotal role in Tata group’s focus on domestic consumption as a key theme in their growth philosophy Metals IT Shared brand and synergies Financial with various Tata Group companies and p
Slide 43: Lending Subsidiary (Tata Capital Housing Finance Ltd.)
Lending Subsidiary (Tata Capital Housing Finance Ltd.)
Slide 44: TCHFL – Business overview
TCHFL – Business overview About TCHFL Disbursements (INR Cr) Fully owned subsidiary - Incorporated as 100% subsidiary of Tata Capital, dedicated towards Housing finance business 17,338 17,651 47% Growing steadily - Phygital model with a mix of leveraging digital sales, 12,008 number of partnerships
Slide 45: TCHFL – Financial performance
TCHFL – Financial performance Y-o-Y FY23 INR Cr 9M FY23 9M FY24 Growth 17,338 Disbursals 12,008 17,651 47% 37,695 Loan book 34,823 47,289 36% 1,767 NIM + Other Revenue 1,247 1,602 28% 634 Operating expenses 434 630 45% 32 Credit cost 2 -150 ~ 1,101 Profits before tax 811 1,122 38% 821 Profits after
Slide 46: Serving India 'Responsibly'
Impacting Lives Serving India Financing green projects ‘Responsibly’ Serving the Underserved
Slide 47: Impacting Lives
Impacting Lives Climate Action Health Education | Skilling Water security Cancer Care Scholarships Treatment Renewable energy Quality Primary Eradication of Education curable blindness Financial Literacy 358,000+ 598,000+ 331,000+ lives impacted lives impacted lives impacted 1,287,000+ ▪ Aligned to
Slide 48: Financing green projects through Cleantech Finance
Financing green projects through Cleantech Finance • Tata Capital along with IFC had established a separate financing arm called Tata Cleantech in 2012 with a clear focus on Green or Sustainable financing • First Indian entity to join the Global Green Bank Network comprising National Green Banks fro
Slide 49: Serving the Underserved
Serving the Underserved Tata Capital makes essential financing available for underbanked individuals or businesses through multiple products Microfinance MSME loans • Microfinance customers are typically unbanked individuals or • Business loans provided to small businesses in India which are a group
Slide 50: Awards & Recognition
Awards & Recognition ‘Asset Finance Company ET BFSI Excellence award Golden Peacock award Multiple awards at Multiple awards at Green Urja award – Top Best Digital Customer of the Year’ & ‘Best – Microfinance Team for Risk Management, Digital Customer Banking Frontiers Private financing Experience M
Slide 51: Disclaimer
Disclaimer This presentation is being furnished solely for your information and may not be reproduced or redistributed to any other person. This presentation should not be distributed, reproduced, or used without the express consent of Tata Capital Ltd. (“Company”). The term “Company” shall include
Slide 52: Thank you
TATA CAPITAL Count on us Thank you