Spandana Sphoorty Financial Limited · NSE:SPANDANA
Spandana Sphoorty Financial — Q1 FY2023 Earnings Presentation
25 slides from Spandana Sphoorty Financial's earnings presentation, Aug 4, 2022
Slide 1: Cover letter to stock exchanges
Ref: SSFL/Stock Exchange/2022-23/52 Date: August 04, 2022 To To BSE Limited, National Stock Exchange of India Limited, Department of Corporate Services Listing Department P. J. Towers, 25th Floor, Exchange Plaza, C-1, Block G Dalal Street, BandraKurla Complex, Bandra (E) Mumbai – 400001 Mumbai – 400
Slide 2: Spandana Sphoorty Financial Limited – Q1, 2023 Update
Spandana Sphoorty Financial Limited ….Committed to low-income households Q1, 2023 Update 18 Years
Slide 3: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the “Presentation”), which have been prepared by Spandana Sphoorty Financial Limited (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe f
Slide 4: Q1 FY23 – A New Beginning
Q1 FY23 – A New Beginning ▪ New Customers Acquired during the quarter 1.06 lacs Disbursement & New ▪ Q1 disbursement : Rs.1,320 crs as against Rs.216 crs in FY22 Q1, growth of 511% YoY Customer Acquisition ▪ Strong end to the quarter with Rs.905 crs of disbursement in Jun’22 ▪ Management re-evaluate
Slide 5: Pre Write Off: Core book performing strongly
Pre Write Off: Core book performing strongly- Non restructured book (~87% of the AuM) has 105%+ Collection Efficiency. Challenges stem from older, restructured book (only 13% of AuM) Collection Efficiency: Pre Mar-21 Pre write-off Jun-22 Non Restructured Book AUM is Rs.6,214 crs 107.8% 98.1% 96.8% 9
Slide 6: Pre Write Off: ~96% of Par 90+ book originated prior to Mar-21
Pre Write Off: ~96% of the Par 90+ book originated prior to Mar-21; Post April-21 Book exhibiting strong asset quality metrics @107% Pre write- off Book NPA Breakup Post April-21 Originated Book has Strong Asset Quality 1,069* % of Post Apr-21 95% 4% 1% 38 (3.6%) Post Apr-21 Book AUM (Rs.3,857 crs)
Slide 7: One-time clean up of pre-Mar-21 originated book
One-time clean up of pre-Mar-21 originated book Pre Write-off break-up of the book Post Write-off break-up of the book 353 6% 814 13% 1,542 1,302 25% 24% 3,857 Rs.702 crs 62% one-time 3,857 write-off 70% Pre Mar-21 originated Restructured Pre Mar-21 originated Restructured Pre Mar-21 originated Non-
Slide 8: Retained Pre-March'21 book showing strong asset quality
Retained Pre-March’21 book showing strong asset quality @105%: 77% paying 3 out of 3 instalments, 86% are paying 2 or more Sharp NPA reduction from 17.2% to 6.7% Pre Mar-21 Originated Retained Book performing strongly (Restructure + Non restructure) Rs. Crs PAR 90+ 1,069* % of AUM 38 76.8% 458 367*
Slide 9: Robust collection efficiency in Retained Book
Robust collection efficiency in Retained Book; continuous QoQ improvement Collection Efficiency: Pre Mar-21 Originated Non Restructured Book Post write-off Jun-22 110.2% 103.1% 105.8% 98.2% 93.8% 98.7% 93.9% 94.0% AUM is Rs.5,513 crs 87.9% 91.1% Collection Efficiency: Post Apr-21 Originated Book 109
Slide 10: Retained Book is displaying a strong collection efficiency of 106%
Retained Book is displaying a strong collection efficiency of 106% Pre Write-off collection efficiency Post Write-off collection efficiency 96.2% 106.0% 94.1% 102.4% 84.8% 86.2% 92.2% 93.8% Rs. 702 crs one-time write-off Q4FY22 Q1FY23 Q4FY22 Q1FY23 CE (Incl. Arrears) CE (Excl. Arrears) CE (Incl. Arr
Slide 11: Adequate Provisioning Buffer and Potential Upside from Write-off Recovery
Adequate Provisioning Buffer and Potential Upside from Write-off Recovery with high capital adequacy of 47.9% Particulars (Rs. Crs) AUM % AUM ECL Provision Coverage Stage 1 4,953 89.9% 32 0.6% - Current 4,731 85.8% 27 0.6% - 1-30 222 4.0% 5 2.1% Stage 2 192 3.5% 52 26.9% Stage 3 367 6.7% 190 51.7% T
Slide 12: Strong Disbursement Momentum Continues in Q1 FY23
Strong Disbursement Momentum Continues in Q1 FY23 FY22 disrupted by Covid-19 and IT disruption 2,426 2,317 1,634 1,321 1,385 1,320 452 216 49 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Lockdowns announced in large Disbursements were stopped in Pace of disbursement reached Rs.1,38
Slide 13: Comfortable liquidity position driven by strong track record
Comfortable liquidity position driven by strong track record Positive ALM (Rs. crs) High level of engagement with rating agencies by the Company Rs. crs1 1,806 Assets Rating Instrument Rating Agency Rating Year Liabilities 1,400 Bank Facilities / NCD’s/ MLD’s India-Ra A RWN Jun 2022 1,028 Bank Facil
Slide 14: Diversified Borrowing Profile supported by best in class Capital Adequacy
Diversified Borrowing Profile supported by best in class Capital Adequacy Diversified Funding Mix (As on 30th June-22) Net-worth and Capital Adequacy Capital 42.4% 42.4% 46.8% 51.1% 47.9% Adequacy Net worth (Rs. crs) Capital infusion of Rs.290 crs. 6.4% 1.7% 19.9% 3,088 8.8% 2,817 2,763 2,743 2,733
Slide 15: Operational Performance Update – Q1 FY23
Operational Performance Update – Q1 FY23 Borrowers (In lakhs) No. of Branches^ State-wise Concentration CAGR Top States AUM Concentration @ CAGR +13% Madhya Pradesh 16.1% +10% 1,052 1,120 1,117 1,010 925 Orissa 15.2% 24.6 25.7 24.5 694 Karnataka 10.9% 23.5 23.5 21.3 15.9 Andhra Pradesh 14% Maharasht
Slide 16: Financial Performance – Q1 FY 2023
Financial Performance – Q1 FY 2023 Total Income (Rs. crs) Net Interest Income (Rs. crs) Yield (%) Cost of Borrowings (%) Yield has decreased on account of a) non- 299 191 charging of delayed interest b) higher 90+ 259 portfolio which has now been written-off 162 17.6% 11.8% 16.4% 10.8% Excluding int
Slide 17: Consolidated Profit & Loss Statement
Consolidated Profit & Loss Statement Particulars (Rs. crore) Q1 FY23 Q4 FY22 Q1 FY22 FY22 Revenue from Operations Interest income 243.9 260.8 396.7 1,336.5 Commission and incentive income - 6.5 - 6.5 Net gain on fair value changes 4.0 8.3 28.7 78.2 Other Income 2.3 11.2 8.7 41.6 Total income from op
Slide 18: Consolidated Post Write-off Balance Sheet
Consolidated Post Write-off Balance Sheet – Networth of 2,817 Cr and Capital Adequacy of 47.9%; Strongest in the Industry ASSETS (Rs. crs) Jun 30, 2022 Mar 31, 2022 LIABILITIES & EQUITY (Rs. crs) Jun 30, 2022 Mar 31, 2022 Financial Liabilities Financial Assets Debt Securities 1,607.4 1,778.2 Cash an
Slide 19: Vision 2025
Spandana 2.0 Vision 2025 Fulfilling dreams of an Aspirational India Growing the micro …fulfilling other financial finance portfolio… product needs (secured & unsecured) of the customer 19
Slide 20: Key priorities in the growth journey
Key priorities in the growth journey Meet customer needs Strengthen Managerial Team Audit, controls & monitoring Focus of Field Operations Technology upgrades Governance, Control, Risk management & Processes Lending partners Explore partnership models on Distribution side Technology to drive Efficie
Slide 21: Growing microfinance book: AUM of ₹15,000 Cr by FY25
We will focus on growing its microfinance book. AUM of ₹15,000 Cr by FY25 Build an incremental 10%-15% secured portfolio from other businesses Geographic expansion Continue to build new Improve Productivity lender relationships and Efficiency Risk, Internal controls & ₹15,000 Cr strong audit process
Slide 22: Well defined strategy of new customer acquisition to deliver AuM Growth
Well defined strategy of new customer acquisition to deliver AuM Growth AUM growth FY22-FY25 New Customer Acquisition Strategy ▪ Focus to be on customer acquisition both through organic business operations and through BC / Co-lending model Total AUM – 15,000 ▪ Source customers from deep rural and se
Slide 23: Steering Progress through Technology
Steering Progress through Technology Current State Future State Web & mobile based technologies with Anytime + Anywhere access Core platforms and Compliance to all Regulatory requirements applications Overall System Comprehensive audit trail with robust maker-checker systems Architecture Tightly int
Slide 24: To build Rs.15,000 crs on-book Microfinance AUM by FY25
To build Rs.15,000 crs on-book Microfinance AUM by FY25 Particulars FY22 FY23 FY25 No. of Branches 1,120 1,120 1,500 Customers (In Lakhs) 23.5 28 40 Disbursement (Rs. Crs) 3,373 8,100 18,000 Average borrower indebtedness 32,000 33,000 47,800 AUM (Rs. Crs) 6,581 9,243 18,164 24
Slide 25: Thank You
Company : Spandana Sphoorty Financial Limited CIN: L65929TG2003PLC040648 www. spandanasphoorty.com THANK YOU
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