Bajaj Finserv Limited · NSE:BAJAJFINSV
Bajaj Finserv — Q3 FY20 Earnings Presentation
39 slides from Bajaj Finserv's earnings presentation, Jan 29, 2020
Slide 1: Exchange filing cover letter - Investor Presentation Q3 FY20
~BAJAJ 'lilFINSERV 29 January 2020 To To Corporate Relations Department. Corporate Listing Department. BSE Limited National Stock Exchange of India Ltd 1st Floor, New Trading Ring, Exchange Plaza, 5th Floor Rotunda Building, P J Tower, Plot No.C-1, G Block, Dalal Street, Mumbai 400 00) . ,~a,g9.r.i!
Slide 2: Bajaj Finserv Limited Investor Presentation - Q3 FY20
BAJAJ FINSERV BAJAJ FINSERV LIMITED Investor Presentation - Q3 FY20* ,,, Financial year 2019-20
Slide 3: Bajaj Group Structure
Bajaj Group Structure [ Bajaj Holdings & Investment Limited | : [ Bajaj Auto Limited | 39.16% BAJAJ [ Bajaj Finserv Limited | FINSERV Bajaj Finance Limited > * Set up in 1987: BFL is a 34 year old company. It is Diversified across consumer, payments, rural, SME, commercial & mortgage lending * Inclu
Slide 4: Bajaj Finserv's Vision - A diversified financial services group with a pan-India presence
Bajaj Finserv's Vision - A diversified financial services group with a --BAJAJ 1 ------ FINSERV pan-India presence Family Protection Health Insurance Life Insurance Life Insurance Life Insurance Fixed Deposits Pensions Mutual funds Retail Consumer: All Bajaj Finserv's businesses have a strong emphas
Slide 5: Bajaj Finserv performance highlights - Q3 FY20
Bajaj Finserv performance highlights - Q3 FY20 FINSERV All Figures in Rs Million Performance Highlights of Q3 FY20 over Q3 FY19 (Ind AS) cy 145,607 11,256 | 312,453 34,806 | PY 111,416 8,505 227,999 31,584 Total Revenue PAT* Net Worth Net Worth (Consolidated) (Consolidated) (Consolidated) (Standalon
Slide 6: Consolidated profit components - Q3 FY20
,--BAJAJ Consolidated profit components - Q3 FY20 ......____ FINSERV All Figures in Rs Million Consolidated profit components for Q3 FY20 (Ind AS) lntercompany adjustments Bajaj Finserv Standalone (385) Others Life Insurance (119) General Bajaj Finance Consolidated profit components for Q3 FY19 (In
Slide 7: 9M FY20 Highlights
9M FY20 Highlights BAJAJ FINSERV BAJA) FINSERV! | 9M FY20 | 9MFYI9 | Growth | Total Revenue 410,572 296,112 39% Net worth 312,453 227,999 37% PAT 31,747 23,803 33% #Consolidated | Ind AS Consoldiated Profit Components” 13% 13% 1% 2018-19 9M FY 18-19 9M FY 19-20 2% mBFL MBAGIC = BALIC mOthers BAJA FI
Slide 8: Bajaj Finance Limited
BAJAJ FINSERV Bajaj Finance Limited 7
Slide 9: BFL - Key Strategic Differentiators
BFL — KEY STRATEGIC DIFFERENTIATORS FINSERV STRATEGY * Diversified financial services strategy seeking to optimise risk and profit, to deliver a sustainable business model and deliver a superior ROE and ROA * Focused on continuous innovation to transform customer experience to create growth opportun
Slide 10: BFL: Business Segments
BFL : Business Segments FINSERV BAJAJ FINANCE = =r Largest consumer electronics, digital products & furniture lender in India Presence in 986 locations with 85,700+ active points of sale Amongst the largest personal loan lenders EMI Card franchise of over 20.5 Mn. cards in force Among the largest ne
Slide 11: BFL - Key Highlights
BFL - Key Highlights BAIA) FY 2019-20 Q) Strong AUM growth YoY across all lines of businesses in the company Q) YoY growth for Consumer B2B sales finance 7%, Consumer B2C 43%, Rural B2B 21%, Rural B2C - 58%, SME 32%, Mortgages 44%, Commercial excluding securities lending 15%, Securities lending 5%.
Slide 12: BFL - Q3 FY20 highlights
BFL - Q3 FY20 highlights BAJA FINSERV All Figures in Rs Million Performance Highlights of Q3 FY20 over Q3 FY19 (Ind AS) cy 1,450,917 | PY 1,075,073 | Book Size cy 1.2% PY 1.1% | Return on Assets (Non-annualized) 70,259 | Taw 49,921 Total Income 5.9% 5.9% ROE (Non-annualized) 16,141 | ES 10,596 Profi
Slide 13: BFL: growth momentum continues
--BAJAJ BFL : growth momentum continues 1 ------ FINSERV All Figures in Rs Million Total Income 1,85,018 1,27,568 70,259 49,921 FY18 FY19 Q3 FY19 Q3 FY20 Net Interest Income 1,18,782 81,429 45,369 32,064 FY18 FY19 Q3 FY19 Q3 FY20 Bajaj Finance Consolidated results are as per Ind AS, previous years f
Slide 14: BFL: Strong profit growth aided by low NPA and control on Opex
--BAJAJ BFL : Strong profit growth aided by low NPA and 1 ----- FINSERV control on Opex All Figures in Rs Million Loss Provision and Net NPAO/o 16,000 15,014 2.0% 14,000 12,000 10,000 8,000 6,000 4,000 2,000 0 0.0% FY18 FY19 Q3 FY19 Q3 FY20 - Loss Provision (Rs. millions) �Net NPA %"' Operating expe
Slide 15: Bajaj Allianz General Insurance
Bajaj Allianz General Insurance 14
Slide 16: BAGIC - Key Strategic Differentiators
BAGIC - KEY STRATEGIC DIFFERENTIATORS STRATEGY Strive for market share growth in chosen segments through a well-diversified product portfolio and multi-channel distribution supported by prudent underwriting DIFFERENTIATORS Industry leading combined ratios consistently over Strong selection of Risk &
Slide 17: BAGIC - Key Highlights
BAGIC - Key Highlights FINSERV FY 2019-20 Q Industry beating YoY GDPI growth of 20% in Q3 FY20 vs Industry growth of 10%. OQ) 32% growth in 9M FY20 vs industry growth of 15% (excluding specialized insurers). Q) Ex-Crop growth was 10% during Q3 FY20 and 12% during 9M FY20 QO Combined ratio stood at 1
Slide 18: BAGIC: Q3 FY20 highlights
BAGIC : Q3 FY20 highlights © BAJA 4| Allianz @ All Figures in Rs Million Performance Highlights of Q3 FY20 over Q3 FY19 cy 30,550 21,898 21,563 | 1,906 | Zon Zam Zo. La, py 25,470 | 19,917 | 18,009 | 2,236 | Gross Written Net Written Premium —_ Net Earned Premium Profit After Tax Premium = Ex Crop G
Slide 19: BAGIC: Combined Ratio trend
BAGIC : Combined Ratio trend BAJAJ I Allianz (ill) Combined Ratios 103.6% 96.8% 96.7% 94.2% 92.3% FY17 FY18 FY19 Q3 FY19 Q3 FY20 1. Combined Ratios are in accordance with the Master Circular on 'Preparation of Financial statements of General Insurance Business' issued by IRDA effective from 1st Apri
Slide 20: BAGIC: Profit after tax and capital efficiency
BAGIC : Profit after tax and capital efficiency BAJAJ Allianz I (ill) All Figures in Rs Million PAT 9,212 7,278 7,799 2,236 1,906 FY17 FY18 FY19 Q3 FY19 Q3 FY20 Total Capital infused is Rs.2,768 Mn BAGIC - Capital Invested - Networth Accumulated profi( 95% of Net worth as on 31 Dec 2019 No Capital i
Slide 21: BAGIC: Consistently amongst top private insurers in terms of Gross Premium
BAGIC : Consistently amongst top 2 private BAJAJ I Allianz (ill) insurers in terms of Gross Premium Industry GDPI Trend (Rs. Bn.) Q3 FY20 GDPI growth 9% 1,617 1,415 1,199 413 451 FY17 FY18 FY19 Q3 FY19 Q3 FY20 ■ PSU ■ Private Insurers·,, Industry BAGIC Premium Trend Q3 FY20 Premium growth 20% 1,10,9
Slide 22: BAGIC: Balanced product mix
BAGIC : Balanced product mix @BAJIA4| Allianz @ Business Mix 5% 13% 15% 14% 5% 7% 31% AT% FY17 FY18 FY19 Q3 FY19 Q3 FY20 Motor (Retail) mHealth (Retail) mGroup Health mProp, Liability, Engg mAgri (Crop Insurance) m™ Others = Ex Crop GWP Growth for Q3 FY20 was 10% and for 9M FY20 was 12% 21
Slide 23: BAGIC: Diversified Channel Mix
BAGIC: Diversified Channel Mix @ BAJA 4 | Allianz @ a 0 Channel Mix a 1 FY17 FY18 FY19 Q3 FY19 Q3 FY20 m Brokers ™ Direct Business Individual Agents ™ Corporate Agents - Others = Corporate Agents - Banks m™ Crop Insurance = With over 75 corporate agent bancassurance tie-ups, this channel has recoded
Slide 24: BAGIC - Virtual Points of Presence
BAGIC - VIRTUAL POINTS OF PRESENCE @BAIA3| Allianz @ VSO Success Graph 9,000 9.5% 8.4% 8.9% 8,000 7,000 6,000 6.2% 5,000 4,000 3.9% 3,000 2,000 1,000 FY17 FY18 FY19 Q3 FY19 Q3 FY20 Rs Million mVSO GWP VSO contribution GWP-Ex Crop 10.0% 9.0% 8.0% 7.0% 6.0% 5.0% 4.0% 3.0% 2.0% 1.0% 0.0% * Initiated in
Slide 25: BAGIC: Assets Under Management continue to grow
BAGIC : Assets Under Management continue to BAJAJ I Allianz (ill) grow AUM(cash and investments) - Rs Billion (as of end of period) BAGIC continues to grow its AUM strongly Investments are largely in fixed income securities Investment Leverage of 3.2x as on 31 Dec 2019 FY17 FY18 FY19 Q3 FY19 Q3 FY20
Slide 26: Bajaj Allianz Life Insurance
Bajaj Allianz Life Insurance 25
Slide 27: BALIC - Key Strategic Differentiators
BALIC - KEY STRATEGIC DIFFERENTIATORS STRATEGY business Value * Balance growth with balanced product mix, seeking steady increase in market share of individual * Business construct is to balance customer benefit with shareholder returns, focusing on New Business DIFFERENTIATORS Diversified Distribut
Slide 28: BALIC - Key Highlights
BALIC - Key Highlights FINSERV 2019-20 Q) Industry beating Individual Rated Premium growth for 9M FY20 at 25% vs Industry growth of 17% (Ex-LIC Industry growth of 16%) Q) Profit after tax for Q3 FY20 increased by 27% to Rs.1,428 Mn vs Rs. 1,122 Mn in Q3 FY19, due to higher investment income and lowe
Slide 29: BALIC - Q3 FY20 highlights
BALIC - Q3 FY20 highlights BAJAJ I Allianz (ill) All Figures in Rs. Million Performance Highlights of Q3 FY20 over Q3 FY19 CY 5,387 _j 8,514 J 11,412 25,519 PY 4,241 7,367 9,523 21,232 Individual Rated NB Group NB Renewal Premium Gross Written Premium CY 1,428 756% Solvency Ratio as on 31 Dec 2019 P
Slide 30: BALIC: Growing ticket size
BALIC : Growing ticket size BAJAJ I Allianz (ill) All Figures in Rs. Regular Premium Ticket Size Regular Premium Ticket Size {Agency) 65,352 88,689 56,128 57,083 74,714 74,780 45,449 62,858 FY18 FY19 Q3 FY19 Q3 FY20 FY18 FY19 Q3 FY19 Q3 FY20 Focus on balancing various customer segments for sustainab
Slide 31: BALIC: Persistency trend
BALIC : Persistency trend BAJAJ I Allianz (ill) Persistency 13th Month Persistency 25 th Month 80% 71% 68% 66% 79% 79% 58% 77% Persistency - 13th Month Persistency - 25th Month FY18 ■ FY19 9M FY19 ■ 9M FY20 FY18 ■ FY19 9M FY19 ■ 9M FY20 Persistency 37th Month Persistency 49 th Month 58% 50% 53% 53%
Slide 32: BALIC: Individual Rated premiums
BALIC : Individual Rated premiums BAJAJ I Allianz (ill) All Figures in Rs Million Individual Rated NB Individual Rated NB Agency 17,420 12,039 13,972 5,387 3,253 4,241 2,945 FY18 FY19 Q3 FY19 Q3 FY20 FY18 FY19 Q3 FY19 Q3 FY20 Institutional Business Individual Rated Individual Rated NB Others NB 3,56
Slide 33: BALIC: Balanced product mix
BALIC : Balanced product mix BAJAJ I Allianz (ill) Individual Rated Mix Share of Non-ULIP business in individual business increasing ■ Individual - Unit Linked ■ Individual - Non Par ■ Individual - Par FY18 FY19 Q3 FY19 Q3 FY20 Group NB Mix Share of protection business in group increasing ■ Group Fu
Slide 34: BALIC: Assets Under Management
BALIC : Assets Under Management cross Rs. 600 © sasjanianz® pn AUM (Mix) * AUM growth of 11% for Q3 FY20 over Q3 FY19 SOS * Of the UL Funds of Rs.238 Bn., 370 59% is equity funds as on 31 326 Dec 2019 (60% as on 31 Mar 238 2019 out of the UL Funds of Rs.230 Bn.) 1 1 1 1 1 1 1 1 214 230 221 1 1 1 1 L
Slide 35: Annexure
1- -BA.JA.J --------- FI NS ERV Annexure
Slide 36: BAGIC: LOB wise Net Claim ratio (Major LOBs)
BAGIC : LOB wise Net Claim ratio {Major LOBs) BAJAJ I Allianz (ill) Net Claim Ratio Q3 FY20 Q3 FY19 9M FY20 9M FY19 FY19 Fire 13.4% 40.4% 74.5% 80.1% 74.4% Marine Cargo 42.1% 67.1% 70.2% 90.5% 94.0% Motor OD 72.9% 59.3% 68.2% 58.3% 60.0% Motor TP 67.1% 66.0% 66.3% 68.5% 64.5% otor Total 69.5% 62.9%
Slide 37: Exposure to Downgraded Investments (Debt)
Exposure to Downgraded Investments (Debt) : BAJAJ I Allianz (ill) BALIC fr BAGIC BALIC Type of Fund (BALIC) Total exposure as Of which Impairment Of which performing (Amt in Rs. Mn) of 31 Dec 2019 (non performing) Provided for 1 PAR 3,879 3,288 590 349 2 N-PAR 1,346 1,199 147 88 3 ULIP 1,925 743 1,1
Slide 38: Disclaimer
BAJAJ Disclaimer FINSERV This presentation has been prepared by Bajaj Finserv Limited (the "Company") solely for your information and for your use. This presentation is for information purposes only and should not be deemed to constitute or form part of any offer or invitation or inducement to sell
Slide 39: Thank You
BAJAJ FINSERV Thank You