Capri Global Capital Limited · NSE:CGCL
Capri Global Capital — Q4 FY20 Earnings Presentation
48 slides from Capri Global Capital's earnings presentation, May 9, 2020
Slide 1: Cover letter to stock exchanges
May 9, 2020 The Secretary The Secretary BSE Limited National Stock Exchange of India Limited Pheeroze Jeejeebhoy Towers Exchange Plaza, 5th Floor Dalal Street, Fort Plot No- 'C' Block, G Block Mumbai - 400 001 Bandra-Kurla Complex, Bandra (East) Scrip Code: 531595 Mumbai – 400 051 Scrip Code: CGCL S
Slide 2: Q4FY20 & FY20 Earnings Presentation
s Q4FY20 & FY20 Earnings Presentation 9th May 2020
Slide 3: Disclaimer
Disclaimer This presentation is for information purposes only and does not constitute an offer, solicitation or advertisement with respect to the purchase or sale of any security of Capri Global Capital Limited (the “Company”) and no part of it shall form the basis of or be relied upon in connection
Slide 4: Capri Global Capital: An Introduction
Capri Global Capital: An Introduction A diversified Non-Banking Financial Company (NBFC) with presence across high growth segments like MSME, Construction Finance, Affordable Housing and Indirect Retail Lending segments Promoted by first generation entrepreneur, Mr. Rajesh Sharma, Capri Global C
Slide 5: Here to Help: Our Response to COVID 19
Here to Help: Our Response to COVID 19 EMPLOYEES CONSUMERS BUSINESSES COMMUNITIES • CGCL’s top priority • CGCL is proactively • The Covid-19 • CGCL has distributed continues to be the trying to service lockdown has not groceries and essential health and well being customers with every had any impact
Slide 6: Our Stance Amid Disruption Across Sectors
Our Stance Amid Disruption Across Sectors Sector Headwinds CGCL’s Business Strategy Declining equipment prices and storage Focus on Tier 3 & 4 cities- Majority of our branches falls in cost. Orange & Green Zone where businesses has resumed MSME’s financials are adversely impacted because of Lock
Slide 7: Executive Summary: Emerging as a Stronger Institution
Executive Summary: Emerging as a Stronger Institution Building an Journey Begins Institution Credibility 2011 2016 2020 o Forayed into o Raised Capital of INR Housing 4.45 Bn Finance o Started Construction o Branch network o AUM crosses o Ventured into o Branch network Finance Business expanded to 5
Slide 8: Branch Network Expansion; Adopting Low Cost Hub & Spoke Model
Branch Network Expansion; Adopting Low Cost Hub & Spoke Model Area Managers - Sales - Branch Manager - Credit - Relationship Mangers (DSTs) - Operations - Credit Resource Hub - FCU , Legal Spoke Technical and - Direct connect Collections with customers - Spoke branch functions Benefits of Hub & Spok
Slide 9: Well Capitalized Business Model: Aid to Expansion
Well Capitalized Business Model: Aid to Expansion Current Assets (INR Mn) Capital Adequacy (%) 79.7 3,607 53.0 39.3 38.7 34.5 1,691 825 742 415 567 483 181 114 104 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Investments Cash Equivalents Comfortable liquidity Average net surplus Optimal cash St
Slide 10: FY20 Review: Building Business Strength
FY20 Review: Building Business Strength Managing liquidity for stronger Focusing on operating Cautious lending and loan Q4FY20 efficiencies sourcing approach • Addition of new bank lines • Optimised Operational structure • Cautious approach in CF lending: of INR 20,000 Mn in FY20; by implementing hu
Slide 11: Q4FY20 & FY20 Performance and Analysis
Q4FY20 & FY20 Performance and Analysis 10
Slide 12: Capri Global Capital: Banking The Unbanked
Capri Global Capital: Banking The Unbanked FY20 At A Glance Total AUM* INR 40.35 billion MSME AUM 22920 + Live Accounts INR 20.47 billion CF + IRL AUM INR 10.90 billion 1690+ Employees HL AUM INR 8.98 billion 8 States Total Disbursements INR 12.76 billion 87 PAT Branches INR 1.61 billion Net Worth I
Slide 13: Q4FY20: At a Glance..
Q4FY20: At a Glance.. Consolidated numbers NII (INR MN) PAT (INR MN) AUM (INR MN) 948 940 41,032 489 350 40,348 Q4FY19 Q4FY20 Q4FY19 Q4FY20 Q4FY19 Q4FY20 Capital Adequacy Ratio* (%) Gross NPA (%) Net NPA (%) 38.7% MSME + CF + IRL HF MSME + CF + IRL HF 2.69 1.69 34.5% 1.21 0.89 0.62 0.53 0.39 0.16 Q4
Slide 14: Q4FY20: Key Highlights
Q4FY20: Key Highlights AUM - Segmental Breakup Disbursements - Segmental Portfolio Yield (%) (INR Mn) Breakup (INR Mn) 18.4% 17.2% 16.7% 2,530 15.8% 15.5% 20,466 15.1% 19,709 13.4% 14.0% 2,130 1,659 12,009 1,399 9,619 1,223 8,982 7,926 968 757 600 1,388 1,280 Q4FY19 Q4FY20 Q4FY19 Q4FY20 Q4FY19 Q4FY2
Slide 15: FY20: Key Highlights
FY20: Key Highlights Consolidated numbers NII (INR MN) PAT (INR MN) Cost – Income (%) 3,872 46.6 1612 38.4 3,236 1357 FY19 FY20 FY19 FY20 FY19 FY20 Book Value Per Share (INR) Return on Assets Return on Net Worth 87.9 3.7 3.7 11.0 78.9 10.3 FY19 FY20 FY19 FY20 FY19 FY20 14
Slide 16: Q4FY20: Performance Summary
Q4FY20: Performance Summary All amounts in INR Mn except stated Particulars Q4FY20 Q4FY19 Y-o-Y (%) Q3FY20 Q-o-Q (%) Interest Earned 1654 1572 5.2% 1,686 (1.9%) Interest Expense 713 624 14.3% 703 1.4% Net Interest Income 940 948 (0.8%) 983 (4.4%) Net Interest Margin (NIM)% 9.4% 9.7% (0.3%) 10.0% (0.
Slide 17: FY20: Performance Summary
FY20: Performance Summary All amounts in INR Mn except stated Particulars FY20 FY19 Y-o-Y (%) Interest Earned 6,700 5,307 26.2% Interest Expense 2,828 2,071 36.6% Net Interest Income 3,872 3,236 19.6% Net Interest Margin (NIM)% 9.5% 9.3% 0.2% PAT 1,612 1,357 18.8% RoE (%) 11.0% 10.3% 0.7% Return on
Slide 18: Stable Asset Quality: Stage Analysis As per IND-AS
Stable Asset Quality: Stage Analysis As per IND-AS All amounts in INR Mn except stated ECL Analysis as per INDAS Q4FY20 Q3FY20 Q2FY20 Stage 1 & 2 - Gross 39,398 38,347 38,679 Stage 1 & 2 – ECL Provisions 345 226 207 Stage 1 & 2 – Net 39,053 38,121 38,471 Stage 1 & 2 – ECL Provisions % 0.88% 0.59% 0.
Slide 19: Asset-Liability Split: Consistent Mix
Asset-Liability Split: Consistent Mix All amounts in INR Mn 31st March, 2020 31st March, 2019 19,789 24,409 18,104 19,044 Have consistently 13,180 15,227 16,098 remained cautious about 13,855 short-term asset & 17,312 11,063 liability mismatches by 12,487 ensuring optimally 6,185 matched Balance S
Slide 20: Liability Mix: The Low Cost Benefit
Liability Mix: The Low Cost Benefit Total Borrowings (INR Mn) & Borrowing Mix Higher Share of Bank Borrowing >> Lower Overall Cost of Borrowing 7,280 15,661 27,687 28,562 Nil exposure to short-term money market signifies no probability of default 97% CGCL’s prudence in higher borrowing share 95%
Slide 21: NPA Analysis: Prudent Lending Practises
NPA Analysis: Prudent Lending Practises CGCL (Standalone) FY17 FY18 FY19 FY20 (INR MN) GNPA Product Segment wise – Q4FY20 NPA Recognition 120 DPD 90 DPD 90 DPD 90 DPD Norms GNPA 178 439 560 843 Product Segment GNPA % NNPA % NNPA 152 374 202 278 MSME 4.04% 1.86% Provisions 26 64 358 566 Total Assets
Slide 22: Small Loans: Niche Capabilities
Small Loans: Niche Capabilities MSME Construction Finance Housing Finance Indirect Lending ~ 51 % of AUM ~ 24 % of AUM ~ 22 % of AUM ~ 3 % of AUM • Focus on Tier II & III • Project outreach: 134 • Affordable housing • NBFC Outreach: 9 cities; Customer • Key markets: Mumbai, customers in Tier II & •
Slide 23: Annexure: About CGCL & Industry Scenario
Annexure: About CGCL & Industry Scenario 22
Slide 24: Capri Global Capital In a Nutshell
Capri Global Capital In a Nutshell An upcoming Diversified NBFC with OUR MISSION presence across high growths segments ‘Our mission is to shape this future like MSME, Construction Finance, and create a solid social impact Affordable Housing and Indirect Lending through our flexible and intuitive l
Slide 25: Business Overview: Diversified Portfolio
Business Overview : Diversified Portfolio Our Solutions and Offerings MSME Finance Construction Finance Housing Finance o Cash flow-based lending to self employed o Home Loan for purchase of o Construction Finance/Project Finance, Cash MSME for Business loan against ready/under-construction resident
Slide 26: CGCL Advantage: What Sets us Apart
CGCL Advantage: What Sets us Apart 1 Focus on SENP Borrower 4 Multi Layered Credit Approach o Strong focus on self employed non-professional borrower; carved o Customized underwriting approach basis the customer’s out a niche in this segment. profile; Credit team personally spends time with customer
Slide 27: MSME Lending: A Huge Unexplored Opportunity
MSME Lending: A Huge Unexplored Opportunity The NBFC Advantage in MSME Funding FY13 FY19 MSME Systemic Lack of formal avenues for financing ensures low 8.7 Tn 17.3 Tn Credit (INR) penetration from banks Banks face issues in financing MSMEs due to high Non-Banks NPAs, high processing times, highe
Slide 28: MSME: Small Loans, Big Opportunity
MSME: Small Loans, Big Opportunity Focus Area MSME Assets by Geography 2% 9% 2% Delhi NCR 30% Maharashtra 16% Gujarat Micro Enterprise Small Enterprise MP • Self Employed Individuals – • Small enterprises with Rajasthan Provision stores, retail formal income Punjab outlets, handicrafts etc documenta
Slide 29: MSME: CGCL's Growth Driver
MSME: CGCL’s Growth Driver Disbursals (INR Mn) Live Accounts 8,050 12,578 7,871 11,051 5,040 6,100 FY18 FY19 FY20 FY18 FY19 FY20 Direct Sourcing (AUM) 81% 73% 55% FY18 FY19 FY20 28
Slide 30: Affordable Housing: Large Demand & Low Formal Financing
Affordable Housing: Large Demand & Low Formal Financing Housing Shortage Urban Housing shortage pegged to reach 34.1 million 43.7 units by 2022 90%+ of the shortage corresponds to Lower Income 18.8 Group (LIG) & Economically Weaker Sections (EWS) In 2015, the Government of India launched the Urban H
Slide 31: Housing Finance: Capitalising on Affordable Housing Opportunity
Housing Finance: Capitalising on Affordable Housing Opportunity Focus Area HF Lending Portfolio by Geography • Serves middle and lower middle income population in Tier 2 and 3 cities 11% • Ventured in 2016 through its subsidiary 35% Maharashtra – Capri Global Housing Finance Limited 20% Gujarat Delh
Slide 32: Housing Finance: Exponential Growth Potential
Housing Finance: Exponential Growth Potential Disbursals (INR Mn) Live Accounts 5,090 10,207 8,637 2,404 2,533 2,621 FY18 FY19 FY20 FY18 FY19 FY20 Portfolio Yield (%) 14.0% 13.4% 12.0% FY18 FY19 FY20 31 Note: FY18 was the 1st full year of operations
Slide 33: Urban Construction Finance: Significant Scope of Growth
Urban Construction Finance: Significant Scope of Growth Recent Government Initiatives to promote affordable Demand Drivers for Growth in Indian Mortgage Market housing construction • 100% tax exemption on affordable housing • 66% of India’s population is aged below 35 years, construction projects fo
Slide 34: Construction Finance: The Retail Way
Construction Finance: The Retail Way • Exposure to Mumbai region at 26 % Addressing Concentration • Reduced average interest rates to in FY20 vs 69% in FY16 Risk target larger developer audience • New geographies added in past 2 • Aim to specialize in small ticket years: Ahmedabad, Chennai, construc
Slide 35: Construction Finance: Building a Sustainable Future
Construction Finance: Building a Sustainable Future Focus Area CF Lending Portfolio by Geography • Construction linked loans to small and 3% 3% midsize real estate developers 6% Mumbai 3% 26% • Comprehensive framework for project Pune Bangalore selection and credit appraisal 9% Ahmedabad Delhi-NCR •
Slide 36: Construction Finance: High Yield, Low Risk
Construction Finance: High Yield, Low Risk Disbursals (INR Mn) Number of projects 8,860 146 8,240 134 98 4,220 FY18 FY19 FY20 FY18 FY19 FY20 Portfolio Yield (%) 18.4% 17.2% 16.0% 35 FY18 FY19 FY20
Slide 37: Indirect Retail Lending: Unique Product Offering
Indirect Retail Lending: Unique Product Offering` Focus Area AUM Disbursements Lending to small NBFCs engaged in INR 1,278 Mn INR 970 Mn • MSME Lending and Microfinance • Two Wheelers and Commercial Vehicles finance Hypothecation of receivables - 1 to Ticket Size Range Customers 1.2X cover INR 5
Slide 38: Over the Years…
Over the Years… Net Interest Margin (%) Pre-Tax RoCE (%) Spread (%) 6.4 11.3 11.8 5.6 5.7 14.8 5.1 4.9 8.5 9.2 11.6 9.3 9.3 9.5 5.7 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Return on Equity (%) Cost to Income Ratio (%) Return on Assets (%) 11.0 52 3.5 3.5 3.7 3.7 10
Slide 39: Over the Years…
Over the Years… NII (INR Mn) PAT (INR Mn) 3,872 1,612 3,236 1,357 2,252 1,495 1,671 581 659 436 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 Total Assets (INR Mn) Capital Adequacy (%) 42,770 44,455 79.7 29,710 53 19,861 39.3 38.7 34.2 13,204 FY16 FY17 FY18 FY19 FY20 FY16 FY17 FY18 FY19 FY20 38
Slide 40: Retail focussed model aiding to strong Asset quality
Retail focussed model aiding to strong Asset quality MSME Average Ticket Size (In Mn) Construction Finance Average Ticket Size (In Mn) Housing Finance Average Ticket Size (In Mn) 4.3 277 1.5 2.6 1.1 1.0 1.0 1.5 1.6 99.2 80.0 70.2 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 FY17 FY18 FY19 FY20 MSME GNPA
Slide 41: Focus on Expanding Retail Book
Focus on Expanding Retail Book Disbursement Mix (INR Mn) AUM Mix (INR Mn) MSME CF IL HL MSME CF IL HL 8,860 20,466 8,240 8,050 19,709 7,871 7,230 15,413 5,990 5,090 5,040 12,027 12,009 4,220 9,427 9,619 8,982 7,926 2,922 2,533 5,999 1,600 1,100 970 2,450 1,100 1,388 1,280 65 65 FY17 FY18 FY19 FY20 F
Slide 42: Income Statement- Quarterly Comparison
Income Statement- Quarterly Comparison INR Mn Q4FY20 Q4FY19 Y-o-Y(%) Q3FY20 Q-o-Q(%) Interest earned 1,654 1,572 5% 1,686 (2%) Interest expanded 713 624 14% 703 2% Net interest income 940 948 (1%) 983 (4%) Non-interest income 167 204 (18%) 143 17% - Fee and Commission income 15 26 (43%) 91 (3%) - Ot
Slide 43: Income Statement
Income Statement INR Mn FY19 FY20 Y-o-Y(%) Total interest earned 5,307 6700 26% Total interest expanded 2,071 2828 37% Net interest income 3,236 3872 20% Non-interest income 606 495 -18% - Fee and Commission income 76 50 -34% - Other Income 530 445 -16% Total Income 3,842 4367 14% Operating expense
Slide 44: Balance Sheet
Balance Sheet INR Mn FY19 FY20 Y-o-Y (%) Share Capital 350 350 0% Reserves and Surplus 13,477 15,042 12% Networth 13,827 15,392 11% Borrowings 27,687 28,366 3% Other Liabilities and Provisions 1,256 697 (45%) Total liabilities & stockholders' equity 42,770 44,455 4% Net Block 127 317 149% Investment
Slide 45: Leadership Team
Leadership Team Surender Sangar Amar Rajpurohit Ashish Gupta Hemant Dave Head – Construction Finance Business Head (MSME) Chief Financial Officer Head of Operations Ex-AU Financiers India Ltd, Gruh Ex-MD – Tourism Finance Corporation of Ex - Jindal Stainless, Isolux, Ex - Kotak Mahindra Bank, A. F.
Slide 46: Board of Directors
Board of Directors Rajesh Sharma Ajay Kumar Relan Bhagyam Ramani Managing Director Independent Director Independent Director Founder & promoter Founder CX Partners & Citi Ex- GM and Director of General Over 23 years of experience Bank N.A. in India, Insurance Corporation Chartered Accountant Over 4
Slide 47: Key Partnerships
Key Partnerships Lenders Auditors & Advisors 46
Slide 48: Thank You
Thank You For further information, please get in touch with: Hardik Shah Hardik.shah@capriglobal.in T: +91 7304411516 Sheetal Khanduja sheetal@GoIndiaAdvisors.com M:+91 97693 64166 Rajat Gupta rajat@GoIndiaAdvisors.com M:+91 9971897739