Mas Financial Services Ltd. · NSE:MASFIN
Mas Financial Services — Q1 FY21 Earnings Presentation
45 slides from Mas Financial Services's earnings presentation, Aug 12, 2020
Slide 1: Exchange filing letter for investor presentation Q1 FY21
Jlt{J\� FINANCIAL SERVICES LIMITED 'lne lfuwer uf<Distri.iution MFSL/SEC/E0/2020/46 12'h August, 2020 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 Com
Slide 2: Investor Presentation – Q1 FY21
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Slide 3: Disclaimer
Disclaimer �- ENDEAVO�S 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
Slide 4: Table of Content
Table of Content � ENDEAVO�S 04 MAS AT A GLANCE 05 JOURNEY OF 100 QUARTERS 06 STRONG FUNDAMENTALS 07 NAVIGATING COVID 19 PANDEMIC 10 MORATORIUM & COLLECTION TREND 11 PRODUCT OFFERINGS 13 LIABILITY MANAGEMENT 14 GOING FORWARD 15 FINANCIAL REVIEW 22 CREDIT QUALITY 25 REPUTED MARQUEE INVESTORS 26 FINAN
Slide 5: MAS at a Glance
MAS at a Glance �� ENDEAvo:Us 25 Years of Endeavours Strong Retail Presence & Distribution Network Delhi NCR 56,577 Mn. 6 105 Rajasthan • I 10 branches covering • 1 branch major towns AUM States and NCR Branches of Delhi Gujarat • 59 branches across the state Madhya Pradesh 3,455 7,00,000+ • 10 bran
Slide 6: Journey of 100 Quarters
Journey of 100 Quarters �� ENDEAvo:Us Asset Under Management (AUM) 59,663 53,384 41,570 31,561 25,650 20,052 13,910 10,123 3,884 5,118 6,909 1,510 2,312 2,597 2,682 20 4Q 44Q 48Q 52Q 56Q 60Q 64Q 68Q 72Q 76Q 80Q 84Q 88Q 92Q 96Q 100Q 1,782 Profit After Tax (PAT) 1,521 1,034 674 534 311 390 183 259 132
Slide 7: Strong Fundamentals
Strong Fundamentals �� ENDEAvo:Us Enablers for Navigating through current unprecedented challenges SUCCESSFUL TRACK STRONG PROVISION HIGHLY CAPITALISED ROBUST LIQUIDITY RECORD BUFFER & PORTFOLIO POSITION QUALITY • Successfully withstood • Adequetly capitalised for • Consistent track record of • Cash
Slide 8: Navigating COVID pandemic (1/3)
Navigating COVID 19 pandemic (1/3) �� ENDEAvo:Us ASSETS AND PORTFOLIO QUALITY • The AUM stood at INR 56,577 Mn. a growth of 1.43% over the corresponding period. However, the two quarters are not comparable due to the pandemic impact. The Gross Stage 3 Assets is 1.41% and Net Stage 3 Assets is 1.14%
Slide 9: Navigating COVID pandemic (2/3)
Navigating COVID 19 pandemic (2/3) �� ENDEAvo:Us CAPITAL AND LIQUIDITY MANAGEMENT • Company’s Capital adequacy remained strong at 34.93% with Tier I Capital of 32.20% and Tier II Capital of 2.73%. The Company has adequate capital and financial resources to fuel its future growth. • As on 31st July 2
Slide 10: Navigating COVID pandemic (3/3)
Navigating COVID 19 pandemic (3/3) �� ENDEAvo:Us OPERATIONAL MANAGEMENT • Currently , all our 105 branches are operational with adequate staffing to be scaled up gradually depending upon the situation. • Company uses banking platform for 100% of its disbursement and collections. The use of banking p
Slide 11: Moratorium & Collection Trend
Moratorium & Collection Trend �� ENDEAvo:Us % CUSTOMERS BY VALUE 87% 74% 55% 51% 49% 45% 26% 13% April May June July Moratorium Collection 10
Slide 12: Diversified product offerings presenting significant growth opportunities
Diversified product offerings presenting significant �� ENDEAvo:Us growth opportunities MAS focuses on serving the underserved credit needs of mid and low income group segments Micro-Enterprise Loans of up to INR 300,000 to Micro-Enterprises which primarily include INR 34,242 Mn. retailers, trader
Slide 13: AUM by Product Category
AUM by Product Category �� ENDEAvo:Us AUM by Product Category (INR Mn.) Segment Performance Micro-Enterprise loans(MEL) SME loans 2-Wheeler loans Commercial Vehicle loans Q1 FY21 vs Q1 FY20 59,663 55,782 56,577 53,384 1,547 4,003 1,521 1,588 4,008 4.76% 1,582 4,552 4,654 Micro-Enterprise loans (MEL)
Slide 14: Liability Management
Liability Management �� ENDEAvo:Us SOURCES OF FUND BORROWING* as on 30th June 2020 COST OF BORROWING (COB)* DIRECT ASSIGNMENT 50% 9.33% 9.31% 9.23% 9.30% 31,227 29,954 8.86% 29,550 25,670 17,571 SUB DEBT 1% CASH CREDIT TERM LOAN Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 24% FY18 FY19 FY20 Q1 FY20 Q1 FY21 2
Slide 15: Going Forward
Going Forward �- ENDEAVO�S ASSET CREATION To anchor to our belief that, growth along with quality is the key to enhance the shareholders’ value. Anticipated growth for the next five years to be in the range of 20% - 30% with an understanding of recalibrating it depending on the macro situation,
Slide 16: Financial Review
... .. .............. � ENDEAVO�S FINANCIAL REVIEW 15
Slide 17: Key Highlights – Q1 FY21
Key Highlights – Q1 FY21 �� ENDEAvo:Us ASSET UNDER MANAGEMENT (AUM) PROFIT AFTER TAX (PAT) ACTUAL WITHOUT EFFECT OF SPECIAL COVID PROVISIONING INR 356 Mn. 12.50% RETURN ON AVG. NET WORTH* 1.43% INR 56,577 Mn. (Jun - 19: INR 55,782 Mn.) INR PAT without effect of special COVID provisioning 585 Mn. 43.
Slide 18: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 �� ENDEAvo:Us ASSETS UNDER MANAGEMENT (AUM) NET WORTH 16.12% 1.43% CAGR 15.86% CAGR 19.80% 11063 10387 59,663 56,577 9527 53,384 55,782 9098 7739 41,570 Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 ON & OFF BOOK AUM ON BOOK OFF BOOK 38% 39% 44
Slide 19: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 �� ENDEAvo:Us REVENUE NET INTEREST INCOME (NII) CAGR 23.09% CAGR 21.08% 6,831 4,111 5,726 3,684 4.57% 4,509 2,804 -0.07% -5.76% 1,592 1,591 953 898 996 FY18 FY19 FY20 Q1 FY20 Q1 FY21 FY18 FY19 FY20 Q1 FY20 Q1 FY21 Q1 FY21 without effect of carrying cost OPERATING EXPE
Slide 20: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 �� ENDEAvo:Us RETURN ON AVG. BALANCE SHEET ASSETS RETURN ON AVG. AUM (ROAUM)* (ROTA)* 5.17% 4.75% 4.02% 4.38% 4.31% 4.14% 3.20% 3.15% 2.98% 2.83% 3.15% 2.45% FY18 FY19 FY20 Q1 FY20 Q1 FY21 Q1 FY21 FY18 FY19 FY20 Q1 FY20 Q1 FY21 Q1 FY21 without effect of without effect
Slide 21: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 �� ENDEAvo:Us Optimized cost structure OPERATING EXPENSE RATIO (OE RATIO)* OPERATING EXPENSE AS % OF NII* 25.86% 1.98% 21.71% 21.86% 20.60% 1.68% 1.59% 1.44% 13.64% 0.84% FY18 FY19 FY20 Q1 FY20 Q1 FY21 FY18 FY19 FY20 Q1 FY20 Q1 FY21 Efficiently maintaining the quality
Slide 22: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 �� ENDEAvo:Us Strongly Capitalized DEBT – EQUITY RATIO (DER) CAPITAL ADEQUACY RATIO (CAR)* 3.01 3.10 34.93% 2.82 2.71 31.89% 31.97% 29.13% 27.97% 2.27 Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 INTEREST COVERAGE RATIO (ICR) 2.15 2.13 1.97 1.
Slide 23: Asset Under Management - Credit Quality
Asset Under Management - Credit Quality �� ENDEAvo:Us ASSET UNDER MANAGEMENT- DPD 8.00% 6.00% 0.55% 1.11% 0.71% 0.76% 0.28% 0.69% 0.58% 1.01% 1.19% 1.00% 4.00% 0.41% 1.58% 1.03% 1.18% 1.13% 0.91% 0.39% 0.88% 0.95% 2.00% 2.75% 2.60% 2.73% 0.78% 1.75% 0.91% 0.00% Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 1 –
Slide 24: Credit Quality
Credit Quality � ENDEAVO�S (In INR Mn.) Q1 FY21 Q1 FY20 FY20 Particulars AUM Provision AUM Provision AUM Provision Stage 1 29918.30 93.58 33283.24 115.06 31762.21 106.04 Stage 2 832.45 95.50 1164.51 132.62 863.52 111.56 Stage 3 596.77 155.73 667.65 139.18 629.19 164.73 TOTAL ON BOOK 31347.52 344.80
Slide 25: Constantly maintaining quality portfolio
Constantly maintaining quality portfolio �� ENDEAvo:Us Catalyst in growth of Entrepreneurs, not creating just borrowers STAGE 3 ASSETS 1.50% 1.39% 1.42% 1.39% 1.41% 1.30% 1.19% 1.14% 1.14% 1.14% 1.14% 1.00% 0.50% 0.00% Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 GROSS STAGE 3 ASSETS NET STAGE 3 ASSETS 24
Slide 26: Reputed Marquee FIIs and DIIs shareholders base
Reputed Marquee FIIs and DIIs shareholders base �� ENDEAvo:Us Shareholding as on 30th June 2020 Marquee Non Promoter Shareholders MOTILAL PRIVATE EQUITY Mutual Fund 8.84% AXIS MUTUAL FUND IDFC MUTUAL FUND Trust TATA AIA LIFE INSURANCE 7.40% RELIANCE ALTERNATIVE INVESTMENT FUND Foreign Portfolio MOTI
Slide 27: Financial Statement: FY18 – Q1 FY21
Financial Statement: FY18 – Q1 FY21 �� ENDEAvo:Us PROFIT & LOSS STATEMENT INR Mn. FY 2018 FY 2019 FY 2020 Q1 FY20 Q1 FY21 Total Revenue 4509 5726 6831 1592 1591 Expenses 2857 3387 4486 966 1115 Finance Costs 1705 2041 2720 640 694 Operating Expense 725 800 899 196 122 Provisions and Loan Losses 428
Slide 28: Assignment Income Reconciliation
Assignment Income Reconciliation �� ENDEAvo:Us Sr. No. Particulars Q1 FY21 Q1 FY20 FY20 Upfront spread booked on present value basis on portfolio assigned 1 144.40 200.33 1074.88 during the year (based on IND-AS) Income booked on asset created out of spread receivable (based on 2 19.18 15.42 63.85 I
Slide 29: MAS Rural Housing & Mortgage Finance Limited (MRHMFL)
MAS Rural Housing & Mortgage Finance Limited (MRHMFL) Subsidiary 28
Slide 30: About MRHMFL
About MRHMFL MAS is targeting affordable housing finance segment through its subsidiary • MAS Rural Housing & Mortgage Finance Limited (“MAS Housing” or MRHMFL) is a non-deposit taking , NHB registered, housing finance institution. It was incorporated in 2008 and headquartered in Ahmedabad, Gujarat
Slide 31: Navigating COVID pandemic (1/2)
Navigating COVID 19 pandemic (1/2) ASSETS AND PORTFOLIO QUALITY • The AUM stood at INR 2,842 Mn. a growth of 4.61% over the corresponding period. However, the two quarters are not comparable due to the pandemic impact. The Gross Stage 3 Assets is 0.36% and Net Stage 3 Assets is 0.26% of AUM as on 30
Slide 32: Navigating COVID pandemic (2/2)
Navigating COVID 19 pandemic (2/2) CAPITAL AND LIQUIDITY MANAGEMENT • Company’s Capital adequacy remained strong at 42.07% with Tier I Capital of 33.26% and Tier II Capital of 8.81%. The Company has adequate capital and financial resources to run its business operations. • As on 31st July 2020, the
Slide 33: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 ASSETS UNDER MANAGEMENT (AUM) NET WORTH 13.58% 4.61% CAGR 31.28% CAGR 18.71% 528 536 2,865 2,842 466 472 2,702 2,716 2,033 307 Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 Mar-18 Mar-19 Mar-20 Jun-19 Jun-20 BORROWING GROSS STAGE 3 ASSETS & NET STAGE 3 ASSETS GROSS STAGE 3 ASSET
Slide 34: Financial Performance – Q1 FY21
Financial Performance – Q1 FY21 REVENUE NET INTEREST INCOME (NII) CAGR 23.04% CAGR 21.05% 399 155 324 129 263 -11.90% 106 -5.64% 98 86 33 31 FY18 FY19 FY20 Q1 FY20 Q1 FY21 FY18 FY19 FY20 Q1 FY20 Q1 FY21 PROFIT BEFORE TAX (PBT) PROFIT AFTER TAX (PAT) CAGR 26.92% CAGR 21.83% 42 42 32 27 29 -10.92% -14
Slide 35: Liability Management
Liability Management • The composition of our liability mix ensures healthy ALM and well diverse resource mix. Sources of Fund as on 30th June 2020 • The Liability management was tested last quarter and the company could successfully demonstrate its capability of efficient liability management CASH
Slide 36: Credit Quality
Credit Quality (In INR Mn.) Q1 FY21 Q1 FY20 FY20 Particulars AUM Provision AUM Provision AUM Provision Stage 1 2,492.29 3.47 2,603.61 4.63 2,487.95 3.48 Stage 2 85.31 4.62 80.11 4.51 101.37 5.44 Stage 3 9.70 2.67 10.42 2.85 9.27 2.56 TOTAL ON BOOK 2,587.30 10.76 2,694.14 12.00 2,598.59 11.48 Assigne
Slide 37: Understanding MAS
... .. .............. � ENDEAVO�S UNDERSTANDING MAS 36
Slide 38: About MAS – Fundamentals
About MAS �- ENDEAVD�S � � ........ VISION MISSION BELIEF To be one of the most efficient To constantly endeavor, to attain excellence and “We have miles to go & Promises to keep……” distributors of financial services and create a very wide Financial distribution network and “Together we can and we w
Slide 39: Unique and Robust Distribution Network Through NBFC Partners (1/2)
Unique and Robust Distribution Network �� ENDEAvo:Us Through NBFC Partners (1/2) AIM & OUR UNDERSTANDING Efficient last mile delivery of credit Value chain approach has proven to be Better quality of intermediation with Revenue sharing model ensures scalability across its product range namely MEL, t
Slide 40: Unique and Robust Distribution Network Through NBFC Partners (2/2)
Unique and Robust Distribution Network �� ENDEAvo:Us Through NBFC Partners (2/2) IMPACT MAS NBFCs Borrowers Eco-System • Widens its network while maintaining • Value addition in improving their • Creates an all-round enabling • Catalyst in Efficient last mile delivery a relatively lower risk profile
Slide 41: Robust and Comprehensive Credit Assessment & Risk Management Framework
Robust and Comprehensive Credit Assessment & �� ENDEAvo:Us Risk Management Framework MAS aims to give credit where it is due with the dictum of adherence and adaptability Robust credit assessment Credit assessment process overview by Product Micro-Enterprise Loans SME Loans • Analysis of business po
Slide 42: Team MAS
Team MAS �- ENDEAVO�S EXPERIENCED PROMOTERS Mr. Kamlesh Chimanlal Gandhi, aged 54 years, is the Founder, Chairman and Managing Director of MAS since inception. He visualized the opportunities in the retail financial services very early and has been leading the strategic initiatives and the execu
Slide 43: Team MAS – Eminent Directors
Team MAS �� ENDEAVO�S EMINENT DIRECTORS Mrs. Darshana Saumil Pandya Mr. Bala Bhaskaran Mr. Chetan Ramniklal Shah Mr. Umesh Rajanikant Shah Mrs. Daksha Niranjan Shah Executive Director & CEO Independent Director Independent Director Independent Director Independent Director Darshana Saumil Pandya,
Slide 44: Major events and milestones
Major events and milestones �� ENDEAvo:Us 2008 2018 1995 - Acquired second and third round of capital 2016 - Listing of Equity Shares on Bombay Stock Exchange & 2020 infusion worth INR 435 2012 2014 National Stock Exchange On incorporation, - Completed 25th Year of Mn. and INR 400 Mn. from - Bank lo
Slide 45: The Power of Distribution
<Ifie (J'ower of(J)istri6ution REGISTERED OFFICE MAS Financial Services Limited 6, Ground Floor, Narayan Chambers, Ashram Road, Ahmedabad-380009 www.mas.co.in INVESTOR CONTACT Mr. Ankit Jain Mr. Nishant Vyas Chief Financial Officer Investor Relations Manager 079-41106682 079-41106730 ankit_jain@mas.
MAS Financial Services — Q1 FY21 Earnings Presentation on 6ix