Sammaan Capital Ltd · NSE:SAMMAANCAP
Sammaan Capital — Indiabulls Housing Finance — Q4 FY2015 Earnings Presentation
47 slides from Sammaan Capital's earnings presentation, Apr 24, 2015
Slide 1: Indiabulls Housing Finance Limited
Indiabulls Housing Finance Limited (CIN: L65922DL2005PLC136029) Annual Audited Financial Results for Q4 FY 2014-15 and FY 2014-15 April 24, 2015
Slide 2: Safe Harbour Statement
Safe Harbour Statement This document contains certain forward-looking statements based on current expectations of Indiabulls management. Actual results may vary significantly from the forward-looking statements in this document due to various risks and uncertainties. These risks and uncertainties in
Slide 3: Contents
Contents Pg. No. 1. Business Update 4 2. Operational Update 7 3. Indian Mortgage Market 10 4. Financial and Operational Highlights 17 5. Sustained Financial Performance 32 6. Key Ratios, Valuations and Shareholding 39 7. Detailed Financials 44 3
Slide 4: Business Update
Indiabulls HOME LOANS Business Update
Slide 5: Our Journey
Our Journey 2014-15 Credit Rating upgraded to AAA Cumulative disbursements 2013-14 crosses Rs.1,00,000 Cr. Balance Sheet : Rs. 57,231 Cr. PAT : Rs. 1,901 Cr. 2012-13 RoE : 29% PAT: Rs.1,569 Cr, Balance Sheet : Rs.44,417 Cr RoE : 27% 2011-12 Conversion to HFC India’s 3rd largest H
Slide 6: Business Update: Key Financial Highlights
Business Update Key Financial Highlights: FY 2014-15 FY 14-15 FY 13-14 Growth (%) Total Revenues (Rs. Cr.) 7,270.4 5,904.8 23.1% NII (Rs. Cr.) 3,179.5 2,607.5 21.9% PAT (Rs. Cr.) 1,901.2 1,568.5 21.2% EPS (Rs.) 55.0 48.0 RoE 29% 27% CRAR 18.4% 19.1% Year-on-Year (Y-o-Y) Comparison – Q4 FY14-15 v/s Q
Slide 7: Operational Update
Indiabulls HOME LOANS Operational Update
Slide 8: Business Summary
Business Summary • Loans Outstanding : Rs. 52,235 Cr (March 31, 2015) : (US$ 8.43 bn) • Loan Book CAGR (6 years) : 26% • Cumulative Number of Retail Customers Served : 6.44 Lacs • Cumulative Loans Disbursed till date : Rs. 106,604 Cr (US$ 17.19 bn) • Cost to Income Ratio (FY 2015) : 16.4% • Profit A
Slide 9: Credit Ratings
Credit Ratings Long Term Short Term Rating Rating CARE Ratings AAA A1+ Brickwork Ratings AAA CRISIL (A Standard & Poor’s Company) AA+ A1+ ICRA (An Associate of Moody’s Investor Service) AA+ A1+ India Ratings & Research (A Fitch Group A1+ Company) 9
Slide 10: Indian Mortgage Market
Indiabulls HOME LOANS Indian Mortgage Market 10
Slide 11: Vast Affordable Housing Opportunity
Vast Affordable Housing Opportunity • Urban Housing requirement: estimated at 45 million units by 20221 - Demand continues to increase due to rapid urbanization, growing trend of nuclear families and rising income • Affordable Housing: Policy makers’ focus on Home loans up to 50 Lacs (from sub 25 La
Slide 12: Headroom for Growth - Low Mortgage Penetration
Indian Mortgage Market Headroom for Growth - Low Mortgage Penetration 88% 81% 41% 26% 29% 17% 20% 09% India Thailand China Korea Malaysia Hong Kong USA UK Source: National Housing Bank, 2013 • Lower mortgage penetration compared to advanced and emerging economies implies huge opportunity for growth
Slide 13: Growing HFC Market Share in Expanding Home Loans Market
Indian Mortgage Market Growing HFC Market Share in a Steadily Expanding Home Loans Market 12,000 45% 40% 10,000 37% 40% 35% 8,000 Rs. Billion 32% 35% 6,000 30% 27% 27% 30% 4,000 2,000 25% 3,695 3,990 4,541 5,448 6,249 7,110 10,958 - 20% FY 08 FY 09 FY 10 FY 11 FY 12 FY 13 FY 16E Home Loan Portfolio
Slide 14: Recent Government Policy Initiatives
Recent Government Policy Initiatives • Housing for all by 2022: A major policy goal for the new government - 60 million new housing units - Government focus on making organised housing finance available to all • 100 smart cities plan: Technologically integrated and planned townships - Large housing
Slide 15: Tax Incentives – Low Effective Interest Rates
Indian Mortgage Market Tax Incentives – Low Effective Interest Rates Particular 2015 2010 2000 Loan amt 2,500,000 2,500,000 2,500,000 Nominal Interest Rate(%) 9.90% 9.25% 13.25% Max deduction for interest allowed* 200,000 150,000 75,000 Deduction for Principal# 150,000 100,000 20,000 Tax Rate applic
Slide 16: Buying a Home – Prudent Financial Investment
Buying a Home – Prudent Financial Investment Rental Yield v/s Home Loan Cost* 4.7% 5.1% 3.2% 3.3% 3.5% 3.1% 2.9% 3.1% 2.5% 2.4% Ahemedabad Bengaluru Chennai Delhi Hyderabad Kolkata Mumbai Pune India Rent Yield Effective Interest Rate on Home Loan (5.1%) Increasing Affordability • Difference between
Slide 17: Financial and Operational Highlights
Financial and Operational Highlights 17
Slide 18: Balance Sheet Assets
Balance Sheet Assets 3% 17% Loan Book: 80% Cash & Liquid Investments*: 17% Other Assets: 3% 80% Total Assets As at March 31, 2015 Rs. 57,231 Cr. (US$ 9.23 bn) As at March 31, 2014 Rs. 44,417 Cr. (US$ 7.16 bn) * Cash, Cash Equivalents and Investments in Liquid Debt Instruments US $ amounts are conver
Slide 19: Asset Composition
Asset Composition Q4 FY 13-14 Q4 FY 14-15 21% 22% 5% 2% 74% 76% Mortgage Commercial Vehicle Loans Corporate Mortgage Loans • Driven by the growth of the Home loans book, retail mortgage book growth has outpaced the growth of corporate mortgage book growth • Home loans, which forms the majority of in
Slide 20: Loan Book Growth
Loan Book Growth Total Loan Assets (Rs. Cr.) Loans Sold (Rs. Cr.) (in preceding 12 months) 52,235 6,195 4,171 41,169 46,040 34,425 5,724 3,643 35,445 2,397 2,546 30,782 Mar-13 Mar-14 Mar-15 Mar-13 Mar-14 Mar-15 Ownbook Sell down • Loans sold (outstanding as on 31st Mar, 2015): Rs. 6,195 Cr. – on whi
Slide 21: Asset Quality
Asset Quality As at Mar 31, 2015 0.83% 0.85% (in Rs. Cr.) 0.79% NPA (90+ dpd): 442.8 Provisions for 0.47% 0.49% Contingencies: 615.5 0.46% Of which 0.36% 0.36% NPAs: 256.9 0.33% Other provisioning: 358.6 Regulatory Provisioning: 394.5 Mar-13 Mar-14 Mar-15 Excess Provisioning Over Regulatory Gross NP
Slide 22: Home Loan Profile: Focus on Affordable Housing
Home Loan Profile: Focus on Affordable Housing Average Loan Size 24 Lacs Maximum Loan to Value 80% Average Loan to Value 71% (at origination) Average Loan Term 15 years Primary Security Mortgage of property financed Repayment Type Monthly amortizing • RBI defines Affordable housing finance as housin
Slide 23: Conservative Loan Against Property Profile
Conservative Loan Against Property Profile Average Loan Size 68 Lacs Maximum Loan to Value 65% Average Loan to Value 49% (at origination) Average Loan Term 7 years Primary Security Mortgage of property financed Repayment Type Monthly amortizing 23
Slide 24: Country wide reach
Country wide reach Head office • Presence of core Master Service credit committee Centres (MSC) • All decisions for loans above certain • MSC is a regional predefined limits Branches credit hub and is taken jointly by the manned by senior committee • Walk-in branches with personnel credit decisionin
Slide 25: Mortgage Loans' Sourcing
Mortgage Loans' Sourcing 82% of Mortgage loans are sourced in-house 18% 11% 71% Direct Sales Team* Branch Walk-ins External Channels • Over 80% of the incremental sourcing is done in-house by on-rolls employees *Direct Sales Team - on rolls sales employees 25
Slide 26: Liabilities
Liabilities 5% 12% Share Holder’s Funds: Rs. 6,634 Cr. (US$ 1.07 bn) Borrowings: Rs. 47,487 Cr. (US$ 7.66 bn) Other Liabilities: Rs. 3,110 Cr. (US$ 0.50 bn) 83% Total Liabilities: As of March 31, 2015: Rs. 57,231 Cr. (US$ 9.23 bn) As of March 31, 2014: Rs. 44,417 Cr. (US$ 7.16 bn) US $ amounts are c
Slide 27: Diversified Borrowing Programme
Diversified Borrowing Programme 3% 8% 8% 7% 30% 30% 31% ECB Commercial Paper Bonds 62% 62% 59% Bank Loans Mar-13 Mar-14 Mar-15 Total Borrowings: As of March 31, 2015: Rs. 47,487 Cr. (US$ 7.66 bn) As of March 31, 2014: Rs. 35,540 Cr. (US$ 5.73 bn) US $ amounts are converted based on the exchange rate
Slide 28: Diversified Borrowing Programme
Diversified Borrowing Programme 47,487 Borrowings (Rs. Cr.) 45,000 7.5 40,000 35,540 6.5 35,000 31,286 5.9 30,000 5.2 5.5 Borrowings 25,000 4.7 Net Gearing 4.5 20,000 3.5 15,000 10,000 2.5 Net Gearing: Borrowings Net of ‘Cash & Cash Equivalents’ 5,000 and ‘Investments in Liquid - 1.5 Debt Instrument
Slide 29: Business Value Proposition
Business Value Proposition Growing Economy/ Low Focus on affordable housing. Young staff: better connect with mortgage penetration, Nationwide Network with increasingly younger home buyer increasing market share expanding footprint Leading player in Self employed Technology leveraged scalable Health
Slide 30: Eminent and Experienced Board of Directors
Eminent and Experienced Board of Directors Board of Directors with pre-eminence and experience in diverse fields • Mr. Sameer Gehlaut : Chairman of the Board • Mr. Gagan Banga : Vice Chairman and MD • Dr. K.C. Chakrabarty : Former Deputy Governor of the Reserve Bank of India • Justice Surinder Singh
Slide 31: Indiabulls Foundation: Corporate Social Responsibility
Indiabulls Foundation: Corporate Social Responsibility The Foundation has a free medical clinic at Lower Parel to provide primary and preventive health care to the underprivileged and the clinic has successfully Health treated 19,000 patients till date. The Foundation has 6 medically equipped va
Slide 32: Sustained Financial Performance
Sustained Financial Performance 32
Slide 33: Sustained Financial Performance: Loan Book
Q1 FY 11 Q2 FY 11 Q3 FY11 Q4 FY 11 Q1 FY 12 Q2 FY 12 Q3 FY 12 Q4 FY 12 Q1 FY 13 Q2 FY 13 Q3 FY 13 Sustained Financial Performance Q4 FY 13 Loan Book (Rs. Cr.) Q1 FY 14 Q2 FY 14 Q3 FY 14 Q4 FY 14 Q1 FY 15 Q2 FY 15 Q3 FY15 33 Q4 FY15
Slide 34: Sustained Financial Performance: Total Revenues
Q1 FY 11 468 Q2 FY 11 577 Q3 FY11 681 Q4 FY 11 767 Q1 FY 12 835 Q2 FY 12 911 Q3 FY 12 964 Q4 FY 12 1,118 Q1 FY 13 1,050 Q2 FY 13 Q3 FY 13 1,179 1,215 Sustained Financial Performance Q4 FY 13 Q1 FY 14 1,334 1,344 Total Revenues (Rs. Cr.) Q2 FY 14 1,474 Q3 FY 14 Q4 FY 14 Q1 FY 15 1,575 1,569 1,592 Q2
Slide 35: Sustained Financial Performance: Net Interest Income
Q1 FY 11 313 Q2 FY 11 374 Q3 FY11 432 Q4 FY 11 437 Q1 FY 12 417 Q2 FY 12 439 Q3 FY 12 442 Q4 FY 12 544 Q1 FY 13 459 Q2 FY 13 502 Q3 FY 13 540 Sustained Financial Performance Q4 FY 13 628 Q1 FY 14 599 Q2 FY 14 645 Net Interest Income (Rs. Cr.) Q3 FY 14 659 Q4 FY 14 705 Q1 FY 15 701 Q2 FY 15 737 Q3 FY
Slide 36: Sustained Financial Performance: Profit After Tax
Q1 FY 11 134 Q2 FY 11 174 Q3 FY11 207 Q4 FY 11 236 Q1 FY 12 222 Q2 FY 12 231 Q3 FY 12 250 Q4 FY 12 303 Q1 FY 13 268 Q2 FY 13 304 Q3 FY 13 327 Sustained Financial Performance Q4 FY 13 368 Q1 FY 14 352 Profit After Tax (Rs. Cr.) Q2 FY 14 370 Q3 FY 14 395 Q4 FY 14 452 Q1 FY 15 424 Q2 FY 15 448 Q3 FY15
Slide 37: Sustained Financial Performance: Asset Quality
Q1 FY 11 0.90 1.74 Q2 FY 11 0.63 1.38 Q3 FY11 0.53 1.20 Q4 FY 11 0.37 1.03 Q1 FY 12 0.37 1.00 Q2 FY 12 0.32 0.86 Q3 FY 12 0.28 0.78 Q4 FY 12 0.33 0.79 Q1 FY 13 0.33 0.79 Q2 FY 13 0.31 0.76 Gross NPA (%) Q3 FY 13 0.33 0.76 Sustained Financial Performance Q4 FY 13 0.33 0.79 Asset Quality (%) Q1 FY 14
Slide 38: Sustained Financial Performance: Net Gearing
Q1 FY 11 1.8 Q2 FY 11 2.4 Q3 FY11 2.7 Q4 FY 11 3.1 Q1 FY 12 3.2 Q2 FY 12 3.7 Q3 FY 12 3.7 Q4 FY 12 3.9 Q1 FY 13 4.1 Q2 FY 13 4.3 Q3 FY 13 4.5 Sustained Financial Performance Net Gearing Q4 FY 13 4.7 Q1 FY 14 5.1 Q2 FY 14 5.1 Q3 FY 14 5.3 Q4 FY 14 5.2 Q1 FY 15 5.6 Q2 FY 15 5.7 Q3 FY15 6.1 38 Q4 FY15
Slide 39: Key Ratios, Valuations and Shareholding
Key Ratios, Valuations and Shareholding 39
Slide 40: Rising Productivity Ratios
Rising Productivity Ratios FY 2015 FY 2014 FY 2013 FY 2012 No. Of Employees 4,840 4,099 4,072 4,243 Profit Per employee (Rs. Cr.) 0.39 0.38 0.31 0.24 Asset Per employee (Rs. Cr.) 11.82 10.84 8.09 5.85 Cost Income Ratio 16.4% 17.1% 18.0% 18.7% 40
Slide 41: Rising Productivity Ratios
Rising Productivity Ratios FY 2015 FY 2014 FY 2013 FY 2012 Pre Tax RoAA (%) 4.9% 4.8% 4.9% 4.9% Post Tax RoAA (%) 3.7% 3.8% 3.8% 3.7% RoE (%) 29% 27% 26% 22% Capital Adequacy (%) 18.36% 19.14% 18.47% 18.86% - Tier I 15.25% 15.05% 14.96% 18.21% - Tier II 3.11% 4.09% 3.51% 0.65% 41
Slide 42: Valuations and Returns
Valuations and Returns Mar-15 Mar-14 Mar-13 Mar-12 Market Price per share (Rs.) 559.9* 285.6 271.8 207.1 Market Capitalisation (US$ Bn) 3.21 1.59 1.42 1.08 PE Ratio (times) 10.2 6.0 6.8 6.5 Book Value per share (Rs.) 184.5 168.7 165.4 157.7 Price to Book Ratio (times) 3.0 1.7 1.6 1.3 Foreign Shareho
Slide 43: Shareholding Pattern
Shareholding Pattern 17.11% 27.81% 3.30% 51.78% Promoters Foreign Shareholding MFs/Banks/IFI Public MF: Mutual Funds 43 IFI: Indian Financial Institutions
Slide 44: Detailed Financials
Indiabulls HOME LOANS Detailed Financials 44
Slide 45: Consolidated Balance Sheet
Consolidated Balance Sheet Rs. 9,631 Cr. of Cash & Cash Equivalents and Investments in Liquid Debt Instruments 45
Slide 46: Consolidated Income Statement
Consolidated Income Statement 46
Slide 47: Thank you
Indiabulls HOME LOANS Thank you
Indiabulls Housing Finance — Q4 FY2015 Earnings Presentation on 6ix