Mas Financial Services Ltd. · NSE:MASFIN
Mas Financial Services — Q2 FY20 Earnings Presentation
47 slides from Mas Financial Services's earnings presentation, Nov 7, 2019
Slide 1: Exchange filing cover letter
'I& <Power of <Distri6ution 4ffi{J\� FINANCIAL SERVICES LIMITED November 07, 2019 M FSL/SEC/EQ/2019/61 To, To, General Manager The Manager, National Stock Exchange of India Limited BSE Limited Phiroze Jeejeebhoy Towers Exchange Plaza Plot No. C/1, G Block Dalal Street Bandra-Kurla Complex Mumbai -40
Slide 2: Investor Presentation Q2 FY20
<J'lie (power of (J)istri6ution INVESTOR Corporate – PRESENTATION Presentation Q2 FY20 REGISTERED OFFICE MAS Financial Services Limited 6, Ground Floor, Narayan Chambers, Ashram Road, Ahmedabad-380009
Slide 3: Disclaimer
Disclaimer 'l1ie <l"ower of<Distri6uti.cm 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
Slide 4: Table of Content
Table of Content 'l1ie <l"ower of<Distri6uti.cm Company Overview 4 Mission, Vision and Belief 5 Milestones 6 Product Offerings 7 Credit Assessment & Risk Management Framework 9 Retail Presence & Distribution Network 10 Unique and Robust Distribution Network Through NBFC Partners 11 Liability Managem
Slide 5: Company Overview
Company Overview '11i.e a>ower of'1Jistn"6ut:ion SPECAILISED IN IN RETAIL RETAIL LENDING LENDING SINCE 20 YEARS Diversified Product Portfolio Strong Retail Presence & Wide Distribution Network 6 states and Sourcing Intermediaries 'D' Bi,&. Micro-Enterprise loans(MEL) oO SME loans NCT of Delhi 6,00,0
Slide 6: Vision, Mission & Belief
Vision, Mission & Belief 'l1ie <l"ower of<Distri6uti.cm VISION To be one of the most efficient distributors of financial services and create value on a very large scale. MISSION To constantly endeavour, to attain excellence and create a very wide Financial distribution network and to be catalyst; in
Slide 7: Major events and milestones in the history
Major events and milestones in the history '1ne <l"ower of<Distri6uti.cm H1 20 AUM crossed INR 60 Bn. on a consolidated basis. AUM crossed INR 50 Bn. 2019 Bank loan rating upgraded to “ACUITE AA -” with Stable outlook and Short term rating assigned as ACUITE A1+. 2018 Listing of Equity Shares on Bom
Slide 8: Diversified product offerings presenting significant growth opportunities
Diversified product offerings presenting significant growth opportunities -me <Power' of <Distri6ution MAS focuses on serving the underserved credit needs of mid and low income group segments Micro-Enterprise Loans SME Loans Loans of up to INR 300,000 to Micro-Enterprises Loans of up to INR 50 m
Slide 9: Recent Growth in Overall AUM
Recent Growth in Overall AUM 'l1ie <l"ower of<Distri6uti.cm MAS’ has exhibited steady growth in AUM over the years AUM by Product Category (INR Mn) Segment growth YOY Sept -18 vs Sept -19 1,391 4,630 1,582 4,654 Commercial Vehicle loans -8.04% 1,512 16,783 4,292 1,468 13,505 2-Wheeler loans 3,335 7.
Slide 10: Robust and Comprehensive Credit Assessment and Risk Management Framework
Robust and Comprehensive Credit Assessment and Risk Management Framework 'l1ie <l"ower of<Distri6uti.cm 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 Analysis of bu
Slide 11: Retail Presence and Distribution
Retail Presence and Distribution '11ie <Power of <Distri6ution 600,000+ active customers across 3,417 locations in Rural, semi urban and urban locations Presence in the high growth markets in West and South Delhi NCT MAS has expanded to 102 branches in 6 Rajasthan J states and NCT Delhi • Branch –
Slide 12: Unique and Robust Distribution Network Through NBFC Partners
Unique and Robust Distribution Network Through NBFC Partners 'l1ie <l"ower of<Distri6uti.cm Efficient last mile delivery of credit Value chain approach has proven to across its product range namely MEL, be the most potent one to solve SME, 2 Wheeler and Commercial informality because of proximity to
Slide 13: Unique and Robust Distribution Network Through NBFC Partners
Unique and Robust Distribution Network Through NBFC Partners 'l1ie <l"ower of<Distri6uti.cm Operational Dynamics Key Criteria for starting relationship: Promoters Product Operational Financial Growth Strategy Capital Base Evaluation Alignment Excellence Performance Credit Assessment Pre-Engagement D
Slide 14: Unique and Robust Distribution Network Through NBFC Partners
Unique and Robust Distribution Network Through NBFC Partners 'l1ie <l"ower of<Distri6uti.cm MAS NBFCs • Widens its network while maintaining a • Value addition in improving their systems relatively lower risk profile and operations which helps in scalability and Sustainability of business. • Establi
Slide 15: Unique and Robust Distribution Network Through NBFC Partners
Unique and Robust Distribution Network Through NBFC Partners 'l1ie <l"ower of<Distri6uti.cm TRACK RECORD • Started with 1 NBFC in 2008, currently • Have grown at a CAGR of around 35% having relationship with more than 100 in last five years across our product range such NBFCs having virtual presence
Slide 16: Retailed focused partner NBFCs – An Overview
Retailed focused partner NBFCs – An Overview '1ne <l"ower of<Distri6uti.cm Retail focused small regional NBFCs inevitable for last mile delivery of credit. Adequately Capitalized Experienced Management Matching ALM with no liquidity issue for repayment. Demonstrated their capabilities during the rec
Slide 17: Liability Management
Liability Management '1ne <l"ower of<Distri6uti.cm Borrowing Mix as on 30th Sept 2019 20% 1% DIRECT ASSIGNMENT 48% CASH CREDIT 31% TERM LOAN SUB DEBT • Efficient liability management ensures : • Adequate liquidity round the year. • No asset liability mismatch. • Tie up for the fund requirement of th
Slide 18: Liability Management
Liability Management 'l1ie <l"ower of<Distri6uti.cm Liability Planning: • The composition of our liability mix ensures healthy ALM and well diverse resource mix. • The Company withstood the litmus test very successfully also in this one of the most challenging year – A testimony to its very efficien
Slide 19: Consistent Growth in AUM and PAT
Consistent Growth in AUM and PAT '11ie <l"ower of<Distri6ution Asset Under Management (AUM) In INR Mn 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 Mar-1996 Mar-06 Mar-07 Mar-08 Mar-09 Mar-10 Mar-11 Mar-12 Mar-13 Mar-14 Mar-15 Mar-16 Mar-17 Mar-18 Mar-
Slide 20: Key Achievements Highlights – H1 FY20 vs H1 FY19
Key Achievements Highlights – H1 FY 20 vs H1 FY 19 'TM �rof<Distri6ution AUM PAT NII ROAUM OER H1 FY20 INR 58,944 Mn INR 874 Mn INR 1896 Mn 3.11% 1.48% 26% 34% 15% 4% 0.16 0.26 bps bps H1 FY19 INR 46,616 Mn INR 650 Mn INR 1644 Mn 2.95 % 1.74% ABBREVIATIONS AUM ASSET UNDER MANAGEMENT PAT PROFIT AFTER
Slide 21: Key Achievements Highlights – Q2 FY20 vs Q2 FY19
Key Achievements Highlights – Q2 FY 20 vs Q2 FY 19 'TM �rof<Distri6ution AUM PAT NII ROAUM OER Q2 FY20 INR 58,944 Mn INR 467 Mn INR 947 Mn 3.25% 1.55% 26% 35% 10% 4% 0.17 0.24 bps bps Q2 FY19 INR 46,616 Mn INR 346 Mn INR 858 Mn 3.08 % 1.79% ABBREVIATIONS AUM ASSET UNDER MANAGEMENT PAT PROFIT AFTER T
Slide 22: Financial Performance Trends – Q2 FY20
Financial Performance Trends – Q2 FY20 'l1ie <l"ower of<Distri6uti.cm In INR Mn Robust Performance ASSETS UNDER MANAGEMENT (AUM) NET WORTH 58,944 9769 53,384 9098 46,616 8327 7739 41,570 31,561 3769 Mar-17 Mar-18 Mar-19 Sept-18 Sept-19 Mar-17 Mar-18 Mar-19 Sep-18 Sep-19 BORROWING ON & OFF BOOK AUM 2
Slide 23: Financial Performance Trends – Q2 FY20
Financial Performance Trends – Q2 FY20 'l1ie <l"ower of<Distri6uti.cm Consistent Rise in … In INR Mn REVENUE NET INTEREST INCOME (NII) 3,659 5,726 4,509 2,804 3,415 1,902 1,674 858 947 1,359 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 PROFIT BEFORE TAX (PBT) PROFIT AFTER TAX
Slide 24: Financial Performance Trends – Q2 FY20
Financial Performance Trends – Q2 FY20 'l1ie <l"ower of<Distri6uti.cm Focus on Efficiency RETURN ON AVG. BALANCE SHEET ASSETS RETURN ON AVG. AUM (ROAUM)* (ROTA)* 4.75% 4.38% 4.50% 4.46% 3.20% 3.25% 3.08% 3.51% 2.83% 2.36% FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 RETURN ON
Slide 25: Financial Performance Trends – Q2 FY20
Financial Performance Trends – Q2 FY20 'l1ie <l"ower of<Distri6uti.cm OPERATING EXPENSE AS % OF NII* COST OF BORROWING (COB)* 31.75% 9.44% 9.33% 9.71% 25.86% 8.92% 9.19% 23.40% 23.50% 21.17% FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 Efficiently maintaining the quality of as
Slide 26: Financial Performance Trends – Q2 FY20
Financial Performance Trends – Q2 FY20 'l1ie <l"ower of<Distri6uti.cm Adequately Capitalized DEBT – EQUITY RATIO (DER) CAPITAL ADEQUACY RATIO (CAR) 31.89% 4.01 29.13% 28.77% 26.88% 3.05 22.94% 2.82 2.66 2.27 Mar-17 Mar-18 Mar-19 Q2 FY19 Q2 FY20 Mar-17 Mar-18 Mar-19 Q2 FY19 Q2 FY20 Healthy Coverage I
Slide 27: Quality of the portfolio: Stage 3 Assets
Quality of the portfolio : Consistently maintained 'l1ie <l"ower of<Distri6uti.cm Catalyst in growth of Entrepreneurs, not creating just borrowers STAGE 3 ASSETS * 1.50% 1.39% 1.30% 1.29% 1.27% 1.09% 1.00% 1.19% 1.14% 1.06% 1.06% 0.95% 0.50% 0.00% Mar-17 Mar-18 Mar-19 Sept-18 Sept-19 GROSS STAGE 3 A
Slide 28: Asset Under Management - Credit Quality
Asset Under Management - Credit Quality 'l1ie <l"ower of<Distri6uti.cm ASSET UNDER MANAGEMENT- DPD 8.00% 0.79% 1.01% 6.00% 0.68% 0.55% 0.71% 0.49% 0.50% 0.26% 0.76% 0.69% 1.14% 0.58% 1.41% 1.53% 1.00% 4.00% 1.23% 1.58% 1.18% 1.31% 0.97% 2.00% 2.86% 2.75% 2.60% 2.64% 2.83% 0.00% Mar-17 Mar-18 Mar-19
Slide 29: Eminent Board of Directors
Eminent Board of Directors '1ne <l"ower of<Distri6uti.cm Extensive industry experience and deep domain knowledge of financial services sector Mr. Kamlesh Chimanlal Gandhi, aged 53 years, is the Founder, Chairman and Managing Director of MAS since inception. He visualized the opportunities in the
Slide 30: Eminent Board of Directors
Eminent Board of Directors 'T1ie 'l'owerofCDistn'6utWn Extensive industry experience and deep domain knowledge of financial services sector He has been associated with the Company as a Director since November 1995 and as an independent Director since April 2014 He is a management graduate with t
Slide 31: Strengthening of Senior Management Bandwidth
Strengthening of Senior Management Bandwidth 'l1ie <l"ower of<Distri6uti.cm In a move to strengthen its senior management bandwidth, the company has created certain new senior positions and has elevated some of the existing key management personnel (KMPs). All the new appointments were approved by t
Slide 32: Strengthening of Senior Management Bandwidth
Strengthening of Senior Management Bandwidth 'l1ie <l"ower of<Distri6uti.cm CA Nishant Jain from Head – Risk & Monitoring to Chief Risk Officer (“CRO”):Mr. Nishant Jain has overall experience of more than 8 years in Credit & Risk field. Mr. Jain had first joined MAS Financial in 2012 and worked with
Slide 33: Reputed Marquee FIIs and DIIs have invested in MAS
Reputed Marquee FIIs and DIIs have invested in MAS '1ne <l"ower of<Distri6uti.cm Shareholding as on 30th Sept 2019 Marquee Non Promoter Shareholders TIMF HOLDINGS Foreign Portfolio SCHRODER INTERNATIONAL SELECTION FUND INDIAN Investor Mutual Fund Others ( OPPORTUNITIES 2.58% 9.16% Trust Including AI
Slide 34: Going Forward
Going Forward……….. 'l1ie <l"ower of<Distri6uti.cm Asset Creation • To anchor to our belief that, growth with quality will enhance the shareholders’ value. • Anticipated growth for the next five years to be in the range of 20% - 30% and maintain healthy ROA and ROCE, which will be among the best in t
Slide 35: Financial Statement: FY18 – H1 FY20
Financial Statement: FY18 – H1 FY20 'l1ie <l"ower of<Distri6uti.cm PROFIT & LOSS STATEMENT INR Mn FY 2018 FY 2019 H1 FY19 H1 FY20 Total Revenue 4509 5726 2555 3266 Expenses 2857 3387 1550 2140 Finance Costs 1705 2067 911 1371 Operating Expense 725 775 385 415 Provisions and Loan Losses 428 545 255 3
Slide 36: MAS Rural Housing & Mortgage Finance Limited – Subsidiary
MAS Rural Housing & Mortgage Finance Limited (MRHMFL) – Subsidiary 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 incorpo
Slide 37: Financial Performance Trends – Q2 FY20 MRHMFL
Financial Performance Trends – Q2 FY20 MRHMFL In INR Mn ASSETS UNDER MANAGEMENT (AUM) NET WORTH 2702 2822 517 2378 466 2033 1764 300 307 322 Mar-17 Mar-18 Mar-19 Sept-18 Sept-19 Mar-17 Mar-18 Mar-19 Sep-18 Sep-19 BORROWING GROSS STAGE 3 ASSETS & NET STAGE 3 ASSETS 2,546 2,467 0.41% 0.40% 0.36% 0.36%
Slide 38: Financial Performance Trends – Q2 FY20 MRHMFL
Financial Performance Trends – Q2 FY20 MRHMFL In INR Mn REVENUE NET INTEREST INCOME (NII) 324 129 263 103 106 233 97 36 75 32 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 PROFIT BEFORE TAX PROFIT AFTER TAX 42 27 19 20 29 29 10 11* 14 12 FY-17 FY-18 FY-19 Q2 FY19 Q2 FY20 FY-17
Slide 39: Liability Management
Liability Management Borrowing Mix as on 30th Sept 2019 0.88% 6.58% 4.10% NHB REFINANCE TERM LOAN CASH CREDIT 88.43% DIRECT ASSIGNMENT • Efficient liability management ensures : • Adequate liquidity round the year. • Minimum asset liability mismatch. • Tie up for the fund requirement of the whole fi
Slide 40: Liability Management
Liability Management Liability Planning: • The composition of our liability mix ensures healthy ALM and well diverse resource mix. • The Liability management was tested last quarter and the company could successfully demonstrate its capability of efficient liability management • Capital adequacy rat
Slide 41: Reconciliation of profit from IND-AS to I-GAAP
Reconciliation of profit from IND-AS to I-GAAP 'l1ie <l"ower of<Distri6uti.cm IN INR MN Particulars Q2 FY 20 Q2 FY 19 H1 FY 20 H1 FY 19 FY 19 Total Comprehensive Income for the Period (based on IND-AS) 495.86 (44.91) 898.58 602.75 1,455.48 Other Comprehensive Income for the Period, Net of Tax (29.14
Slide 42: Assignment Income Reconciliation
Assignment Income Reconciliation 'l1ie <l"ower of<Distri6uti.cm IN INR MN Sr. Q2 Q2 H1 Particulars H1 FY19 FY19 No. FY20 FY19 FY20 Upfront spread booked on present value basis on 1 241.89 200.12 442.23 355.70 941.45 portfolio assigned during the year (based on IND-AS) Income booked on asset created
Slide 43: Credit Quality
Credit Quality 'l1ie <l"ower of<Distri6uti.cm IN INR MN Sept-19 Sept-18 Particulars AUM Provision AUM Provision Stage 1 35211.21 112.50 28552.16 89.84 Stage 2 1245.13 138.38 1165.28 145.70 Stage 3 623.06 120.18 564.46 107.31 TOTAL ON BOOK 37079.40 371.06 30281.90 342.85 Assigned Portfolio 21864.29 N
Slide 44: Reconciliation of profit from IND-AS to I-GAAP (MRHMFL)
Reconciliation of profit from IND-AS to I-GAAP IN INR MN Particulars Q2 FY 20 Q2 FY 19 H1 FY 20 H1 FY 19 FY 19 Total Comprehensive Income for the Period (based on 10.75 10.41 21.96 19.49 26.74 IND-AS) Other Comprehensive Income for the Period, Net of Tax 0.12 (0.17) 0.06 (0.22) (0.22) Profit After T
Slide 45: Credit Quality (MRHMFL)
Credit Quality IN INR MN Sept-19 Sept-18 Particulars AUM Provision AUM Provision Stage 1 2,716.84 4.60 2,240.71 2.88 Stage 2 72.47 3.81 103.80 4.92 Stage 3 10.92 2.94 8.57 2.50 TOTAL ON BOOK 2,800.23 11.35 2,353.08 10.30 Assigned Portfolio 21.53 N/A 25.16 N/A TOTAL AUM 2,821.76 2,378.24 Particulars
Slide 46: Glossary
Glossary '11ie <l"ower of<Distri6ution AUM Assets Under Management EIR Effective Interest Rate Bn Billion ECL Estimated Credit Loss CCPS Compulsorily Convertible Preference Shares OCPS Optionally Convertible Preference Share COB Cost of Borrowing CRAR Capital To Risk Assets Ratio DPD Days Past Due F
Slide 47: Investor Contact
'Ihe (l'ower of Distribution BEST WISHES INVESTOR CONTACT Name: Ankit Jain Designation: Chief Financial Officer Contact No.: 079-41106682 Email ID: ankit_jain@mas.co.in
MAS Financial Services — Q2 FY20 Earnings Presentation on 6ix