Home First Finance Company India Ltd. · NSE:HOMEFIRST

Home First Finance Company India — Q4 FY22 Earnings Presentation

45 slides from Home First Finance Company India's earnings presentation, May 3, 2022

  1. Slide 1: Exchange filing cover letter

    HFFCIL/BSE/NSE/EQ/9/2022-23 Date: 03-05-2022 To, To, BSE Limited, The National Stock Exchange of India Limited, Department of Corporate Services, The Listing Department, Phiroze Jeejeebhoy Towers, Bandra Kurla Complex, Dalal Street, Mumbai- 400 051. Mumbai- 400001. Scrip Symbol- HOMEFIRST Scrip Code

  2. Slide 2: Investor Presentation – Q4 FY22

    Tech in Mind Service at Heart Smart Loans for Affordable Homes! Investor Presentation – Q4 FY22

  3. Slide 3: Safe Harbor

    Safe Harbor This presentation and the accompanying slides (the "Presentation"), which have been prepared by Home First Finance Company India Ltd. (the "Company"), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe

  4. Slide 4: Executive Summary | FY22

    y-o-y Executive Summary | FY22 Assets Under Management (AUM) Disbursement Gross Stage 3 / POS (GNPA %) ₹53,803 Mn ₹20,305 Mn 2.3%(1) In line with RBI circular dated 12 Nov 2021 +29.9% +85.2% +8.2% 1.3% prior to such classification Spread(2) Cost to Income Opex to Assets 5.6% 34.0% 2.7% +60 bps -500

  5. Slide 5: Executive Summary | Q4FY22

    y-o-y q-o-q Executive Summary | Q4FY22 Assets Under Management (AUM) Disbursement Gross Stage 3 / POS (GNPA %) ₹53,803 Mn ₹6,411 Mn 2.3%(1) In line with RBI circular dated 12 Nov 2021 1.3% prior to such classification +29.9% +7.7% +41.9% +12.5% -30bps Spread(2) Cost to Income Opex to Assets 5.6% 35.

  6. Slide 6: HomeFirst – Who we are

    HomeFirst – W ho we are Technology driven affordable housing finance company with pan India presence Home loans to first time home buyers with predominant focus on salaried __individuals having income < ₹50k p.m 91% of book comprise of housing loans with average ticket size of ₹1.05Mn Strong liquidity

  7. Slide 7: Our Journey

    Our Journey IndiaRatings: Scalable operating model CARE Rating CARE / ICRA Rating Assigned AA- Stable We got listed BBB- BBB+ A- A+ AA- Warburg Pincus ₹53,803 Mn ICRA: Rating invested in Outlook improved the company (2) to A+ Positive A+ Series C AUM (Mar’22) 60,000+ sanctions True North acquires Au

  8. Slide 8: Share Holding as on Apr'22

    Share Holding as on 29 Apr’22 PROMOTER & PROMOTER GROUP % Holding TRUE NORTH FUND V LLP 20.2 AETHER (MAURITIUS) LIMITED (GIC)^ 13.4 TRUE NORTH FUND V LLP KEY INVESTORS % Holding 12.0% 20.2% ORANGE CLOVE INVESTMENTS B.V 28.7 AETHER (MAURITIUS) LIMITED (WARBURG PINCUS) (GIC)^ 7.8 BESSEMER INDIA CAPITA

  9. Slide 9: Distinguished Board of Directors

    Distinguished Board of Directors Chairman & Deepak Satwalekar Independent Director Ex MD, CEO - HDFC Life Geeta Goel Michael and Anuj Srivastava Sucharita Mukherjee Independent Directors Country Director - Susan Dell CEO - Livspace CEO – Kaleidofin Pvt Ltd Dell Foundation Foundation Divya Sehgal Man

  10. Slide 10: Experienced Management Team

    Experienced Management Team Manoj Viswanathan MD & CEO 24+ years in Consumer Lending. 11 years with Citigroup. Ajay Khetan Gaurav Mohta Vilasini Subramaniam Chief Business Officer Chief Marketing Officer Head – Strategic Alliances 19+ years in Consumer Lending & 17+years in Consumer Lending and 16+ year

  11. Slide 11: Meet our customers

    Meet our customers Formal Salaried Informal Salaried Self Employed Customer 1 Customer 2 Customer 3 Age:44 / Location: KR Puram (suburbs of Bangalore) Age: 32 / Location: Sayan (suburbs of Surat) Age: 36 / Location: Avadi (suburbs of Chennai) Who are they? 72% Salaried 27% Self employed Teacher with

  12. Slide 12: Our unique value proposition to our customers

    Our unique value proposition to our customers Who are our customers… What do our customers need What challenges do they face Salaried and self-employed Home loan requirement Inability to meet NPS individuals primarily in the ₹0.5 -1.5 mn documentation requirements range (1) of traditional lenders 75

  13. Slide 13: Distribution Strategy

    0 -4 4-7 7 - 15 Distribution Strategy Contribution to India's GDP FY’21 ( %) Existing branches - 80 New branch locations - 63 Pan India Distribution driven by strategic market selection & contiguous expansion Digital branches - 57 80 98 13 200 Geographic Expansion Branches Districts States/UT Touchp

  14. Slide 14: Omni channel lead generation driving sourcing

    Omni channel lead generation driving sourcing Diversified lead generation channels |Q4 FY22 72.0% Diversified channels for generating leads such as connectors, builder ecosystem, digital, etc. 10.4% 100% in-house conversion 4.0% 2.0% 4.2% 4.6% 0.3% 1.2% 1.3% by HomeFirst RMs. Construction Digital Digi

  15. Slide 15: Data Science backed centralized underwriting

    Data Science backed centralized underwriting Risk Management Design Tech-Led Centralised Loans approved Salaried customers 100+ data points & digitally Consistency in underwriting within 48 hrs captured data for all customers Build detailed understanding Integrated CRM and Loan of customer via field

  16. Slide 16: End-to-end digital process for housing loans

    Scalable operating model built on holistic technology usage Tech Interventions E-NACH API Integration with third party Home First App for all stakeholders E- Sign databases 360 o view of customer for employees E- Vault Proprietary property price predictor E-Stamp paper Electronic payments Instant So

  17. Slide 17: Digital Adoption

    Digital Adoption Avg time spent by user on the app per session App logins Unique Users making Payment via App YoY: 34.1% 33,044 YoY: 96.9% 7,396 1m 54 sec 29,819 5,904 For Q4 FY22 28,251 24,643 24,818 5,035 3,756 3,975 %of unique user logins of active customers 53.6% Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY

  18. Slide 18: ESG at HomeFirst

    ESG at HomeFirst Putting sustainability at core of operations

  19. Slide 19: ESG Framework

    Commitment to ESG ESG Framework The Company understands An ESG Execution Team the growing importance of with management team ESG and has adopted a participation has been created Board approved ESG Policy to ensure implementation of the ESG Policy Comprehensive Robust Policy & Implementation Governan

  20. Slide 20: Digital Processes from start to finish reduces carbon footprint

    Digital Processes from start to finish reduces carbon footprint Green Operations Customer App Connector App RM Pro App Operational Eco-efficiency & Climate Resilience HomeFirst has a deeply ingrained Ideology of all processes being paperless across the product cycle. Implemented Electronic processes

  21. Slide 21: Progress on Social Development

    Progress on Social Development Responsibility towards community Responsibility towards employees Responsibility towards customers Project “Sashakt”, an initiative by HomeFirst to empower Certified as “Great Place To Work” by GPTW Customer Satisfaction the households to uplift these households and br

  22. Slide 22: Strong Governance Structure

    Strong Governance Structure Work Sustainably & Ethically Governance at core Separate Chairman & Managing Sustainable Finance Corporate Governance Director position We promote Financial Inclusion. • Core competencies of Independent Directors We have customers belonging to EWS and LIG categories Exper

  23. Slide 23: Strong Governance Practice

    Strong Governance Practice Top-tier Corporate Governance • High Independent Directors representation in all Board Committees • Highly experience Board & Management Team on Risk Management committee. • Company's risk management framework is driven by its Board and its subcommittees including the Audi

  24. Slide 24: Business Updates

    Business Updates Go

  25. Slide 25: Healthy Growth in Loan Book and Disbursements

    Healthy Growth in Loan Book and Disbursements Disbursement ( ₹Mn ) Last 4 Years Last 8 Quarters 6,411 5,696 5,152 All time high disbursement for the quarter, 4,518 3,488 y-o-y growth of 41.9% 3,046 20,305 2,432 15,728 16,183 10,966 528 FY19 FY20 FY21 FY22 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3

  26. Slide 26: Consistent Portfolio Metrics | Mar'22

    Consistent Portfolio Metrics | Mar’22 1% 1% 7% 1% AUM by Product AUM by Occupation Housing Loan 27% Salaried Shop Loans Self Employed LAP Corporate Developer Finance Sharp focus on High ratio of 91% 72% housing loans salaried customers 74% 2% 9% AUM by Credit history AUM by Ticket Size 7% Have Credi

  27. Slide 27: Expansion in Spreads

    Portfolio Yield Expansion in Spreads COB Spread Net Interest Spread Movement Last 4 Years Last 8 Quarters 12.9% 13.0% 12.8% 13.1% 13.1% 13.0% 12.8% 12.8% 12.8% 12.8% 12.7% 12.3% Sustained Cost of Borrowing 8.8% 8.5% 8.3% 8.4% 8.0% 8.0% 7.4% 7.2% 7.1% 7.2% 7.2% 7.2% FY19 FY20 FY21 FY22 Q1FY21 Q2FY21

  28. Slide 28: Healthy Leading Indicators: Bounce rate

    Bounce rate Healthy Leading Indicators Bounce rate :On the day of EMI presentation Bounce rates normalising COVID COVID WAVE -1 WAVE -2 36.4% 28.3% 20.1% 17.3% 18.3% 16.5% 15.7% 14.5% 13.9% 11.7% 10.8% 10.9% 10.5% 10.2% 9.2% 9.5% 10.0% Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q

  29. Slide 29: Healthy Leading Indicators: Collection Efficiency

    Collection Efficiency (1) Healthy Leading Indicators Unique Customers (2) Collection Efficiency Collection efficiency trending back to normal levels 99.4% 99.4% 97.6% 97.2% 98.5% 98.0% 97.9% 99.1% 98.0% 98.5% 97.4% 96.9% 96.6% 96.9% 97.2% 96.9% 94.7% 94.3% 95.5% 96.3% 96.3% 96.4% 96.0% 94.0% 93.3% 95.0% M

  30. Slide 30: Sound Credit Indicators

    Sound Credit Indicators DPD 1+ / POS DPD 30+ / POS % Stage 3 / POS Stage 2 / POS 5.7% 5.2% 8.9% 4.7% 7.6% 4.1% 1.9% Significant 1.7% 3.7% 6.2% 6.5% 3.7% 5.3% 5.3% 2.6% improvement in 4.4% 1.8% 3.2% 2.0% 2.3% 2.3% 1+ & 30+ DPD 1.7% 3.8% 3.5% 0.8% 1.0% 2.3% 2.1% 0.9% 0.9% 1.4% 1.4% Mar'19 Mar'20 Mar'2

  31. Slide 31: Diversified Funding Profile at competitive cost of borrowing

    DA Diversified Funding Profile at NCD COB% (Represents quarterly avg.) competitive cost of borrowing NHB Refinance NBFC Public Sector Banks Borrowings Mix and Cost of Borrowing trend India Ratings assigned Pvt Sector Banks “IND AA-/Stable” for Bank loans and NCD 100% 10.00% 21%90% 19% 22% 8.5% 21% 20%

  32. Slide 32: ALM Position as of Mar'22

    ALM Position as of Mar’22 Inflow Outflow Cumulative Surplus 7,284 7,093 6,969 10,177 21,725 14,656 (₹Mn) 82,835 Robust ALM profile ensuring 69,731 sufficient liquidity 68,179 buffers 48,120 48,006 Cumulative 37,943 Positive flows across all the time buckets 22,755 15,827 15,786 12,399 8,734 5,115 0-3months

  33. Slide 33: Assignment Volume

    Assignment Volume ₹2,756 Mn ₹3,574 Mn ₹3,003 Mn ₹4,646 Mn Consistent demand for assignment of the company’s portfolio 2,383 1,844 1,491 1,472 1,273 1,159 1,183 1,140 1,050 611 373 - - - - - Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Q3FY22 Q4FY2

  34. Slide 34: Strong Liquidity Position

    Strong Liquidity Position Liquidity Buffer as on Mar’22 (in ₹Mn) Unencumbered Cash and Cash equivalent 6,258 Un-availed Sanction from NHB - Un-availed Sanction from Banks 4,367 Total- 10,625 Particulars (in ₹Mn) Q1 Q2 Q3 Q4 FY23 FY23 FY23 FY23 ₹ 20,150 million Opening Liquidity 10,625 11,957 12,472 1

  35. Slide 35: Financial Updates

    Financial Updates Go

  36. Slide 36: Financial Highlights

    Financial Highlights Profit After Tax ( ₹Mn ) Net worth ( ₹Mn ) Equity Raised 1508 3281 3450 32 2,569 26 6 ( ₹Mn ) (1) 1,741 15,737 15,100 15,737 13,805 13,805 Robust NW to Strong profit growth 1,001 despite maintaining 9,334 support growth 796 (1) 457 459 482 high liquidity and 5,227 313 conservative

  37. Slide 37: ECL Provisions Summary

    ECL Provisions Summary Loan Particulars (in ₹Mn) Stage 1 Stage 2 Stage 3 Commitment Total For period ended Mar’22 Loans – Principal Outstanding 41,926.5 573.5 1,015.2 43,515.2 ECL Provision 143.0 71.0 252.5 11.3 477.8 Net Loans – Principal Outstanding 41,783.5 502.5 762.7 43,037.4 ECL Provision % 0.

  38. Slide 38: Annexures

    Annexures

  39. Slide 39: Quarterly and Annual Profit & Loss Statement

    Quarterly and Annual Profit & Loss Statement Particulars (in ₹Mn) Q4FY22 Q3FY22 Q4FY21 QoQ YoY FY22 FY21 YoY Interest Income on 1,310.3 1,214.4 1,045.3 7.9% 25.4% 4,770.5 4,061.3 17.5% term loans Net gain on DA 138.2 175.8 181.7 678.4 439.3 Income other than interest income on term 112.4 126.8 131.5

  40. Slide 40: RoE Tree

    RoE Tree Particulars Q4 FY22 Q3 FY22 Q4 FY21 FY22 FY21 Interest Income on term loans / Average total assets 10.8% 10.5% 9.8% 9.9% 10.2% Net Gain on DA / Average total Assets 1.1% 1.5% 1.7% 1.4% 1.1% Income other than interest income on term loans/ Average total assets 0.9% 1.1% 1.2% 1.1% 1.0% Total

  41. Slide 41: Key Financial Ratios

    Key Financial Ratios Particulars Q4 FY22 Q3 FY22 Q4 FY21 FY22 FY21 Profit after tax on average total assets (ROA) 4.0%(1) 4.0% 2.9% 3.6%(1) 2.5% Leverage (Average total assets / average Equity or average 3.2 3.1 3.4 3.3 3.5 Net worth) Profit after tax on average equity or average Net worth (ROE) 12.

  42. Slide 42: Balance Sheet

    Balance Sheet Particulars (in ₹Mn) FY22 FY21 ASSETS Cash & cash equivalents and Other bank balance 6,678.5 6,798.7 Loans 43,048.7 33,265.0 Investments - 3,750.1 Other financial assets 1,150.0 1,011.7 Property, plant and Equipment* 200.0 164.0 Non-financial assets other than PPE 91.5 112.1 TOTAL ASSE

  43. Slide 43: Experienced and Diversified Board

    Experienced and Diversified Board Board of Directors Mr. Deepak Satwalekar Ms. Geeta Dutta Goel Mr. Anuj Srivastava Chairman/ Independent/ Non-Executive Director Independent/ Non-Executive Director Independent/ Non-Executive Director Previously, he was associated with HDFC Limited as a Director Ms.

  44. Slide 44: Thank You

    Thank You For further information, please contact Company Investor Relations Advisors CIN: L65990MH2010PLC240703 Mr Ashish Chovatia Mr. Manish Kayal, Head - Investor Relations +91 9930044680 manish.kayal@homefirstindia.com ashish.chovatia@linkintime.co.in Investor Relations - HomeFirst investor.relat

  45. Slide 45: Glossary

    Glossary Terms Explanation Loans – Principal outstanding represents gross principal outstanding of loans as of the last day of the POS - Principal Outstanding relevant period or year as per the restated financial statements. Net Interest Income represents interest income on term loans minus Interest

Home First Finance Company India — Q4 FY22 Earnings Presentation on 6ix