Bajaj Finserv Limited · NSE:BAJAJFINSV
Bajaj Finserv — Q1 FY22 Earnings Presentation
52 slides from Bajaj Finserv's earnings presentation
Slide 1: Bajaj Finserv Limited Investor Presentation Q1 FY22
BAJAJ FINSERV LIMITED Investor Presentation Q1 FY22* * Financial year 2021-22
Slide 2: Bajaj Group Structure
Bajaj Group Structure Bajaj Holdings & Investment Limited (Listed) @ 33.43%2 @ 39.16%1 51% Bajaj Auto Limited (Listed) Maharashtra Scooters Limited (Listed) Bajaj Finserv Limited (Listed) Auto Business Arm Auto spare parts Manufacturer Financial Services Arm 52.65%3 74% 74% 100% 100% Bajaj Allianz B
Slide 3: A diversified financial services group with a pan-India presence
A diversified financial services group with a pan-India presence Life cycle Family, needs of Investment/ Asset Asset Health & Individual & Wealth Retirement acquisition protection Income SME management Protection customers General, Health & Life ULIPs*, Fixed Loan (Personal, General Insurance Annuit
Slide 4: Bajaj Finserv Established businesses with strong track record
Bajaj Finserv Established businesses with strong track record ❑ Non-Bank with strategy & structure of a bank ❑ Diversified financial services strategy with an optimal mix of risk Bajaj Finance and sustainable profit Limited ❑ Focussed on mass affluent & above with a strategy to cross-sell with smart
Slide 5: Bajaj Finserv Emerging Opportunities
Bajaj Finserv Emerging Opportunities ❑ Health Tech venture - aims to transform healthcare sector in India ❑ Integrating the fragmented healthcare delivery ecosystem with Bajaj Finserv Health technology and financial services on a digital platform to bring Limited quality healthcare closer to consume
Slide 6: Role of Bajaj Finserv
Role of Bajaj Finserv ▪ Monitor and engage with our companies with the objective of long-term sustainable profit, meaningful market share, and effective use of capital - thereby delivering superior shareholder returns ▪ We do this by driving companies to create institutionalized frameworks through a
Slide 7: Some of our key initiatives towards furtherance of ESG
Some of our key initiatives towards furtherance of ESG Reaching Financial Services to Preserving and Protecting Governance Million of Indians Environment • Board approved business • Crop insurance to 4.8+ million • Renewable power generated is responsibility policy (including farmers in last 3 years
Slide 8: Bajaj Finserv performance highlights Q1 FY22
Bajaj Finserv performance highlights Q1 FY22 All Figures in Rs Million Performance Highlights of Q1 FY22 over Q1 FY21 (Ind AS) 139,495 8,328 366,001 39,336 CY -2% -31% 11% 10% PY 141,920 12,152 329,571 35,859 Total Revenue PAT* Net Worth Net Worth (Consolidated) (Consolidated) (Consolidated) (Standa
Slide 9: Consolidated profit components Q1 FY22
Consolidated profit components Q1 FY22 All Figures in Rs Million Consolidated profit components for Q1 FY22 (Ind AS) Adjustments (Net of Tax)# Intercompany ❑ Unrealized MTM* Gain on BAGIC Investments Rs. 240 Mn adjustments ❑ Unrealized MTM Gain on BALIC Investments Rs. 10 Mn Bajaj Finserv- Standalon
Slide 10: Q1 FY22 Highlights
Q1 FY22 Highlights All Figures in Rs Million Highlights of Group Companies BAJAJ FINSERV # Q1 FY22 Q1 FY21 Growth BAJAJ FINANCE # Q1 FY22 Q1 FY21 Growth Total Revenue 139,495 141,920 -2% AUM 1,590,569 1,380,546 15% Net worth 366,001 329,571 11% Total Income 67,430 66,497 1% PAT 8,328 12,152 -31% PAT
Slide 11: Bajaj Finance Limited
BAJAJ FINSERV Bajaj Finance Limited ll
Slide 12: BFL Key Strategic Differentiators
BFL Key Strategic Differentiators 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 opportunities. DIF
Slide 13: BFL: Business Segments
BFL : Business Segments BAJAJ FINANCE Consumer SME Commercial Rural • Largest consumer • Focused on affluent • Wholesale Lending • Unique hub-and-spoke electronics, digital SMEs with an average products covering short, model in 1,745 locations products & furniture annual sales of around medium and l
Slide 14: Summary of COVID-19
Summary of COVID-19 ❑ It was a muted quarter impacted by severe second wave of pandemic. Both businesses & debt management efficiencies were affected due to strict lockdowns in majority of the states ❑ Second wave caused a marginal increase in EMI bounce rate in Q1 FY22 over Q4 FY21. Average EMI bou
Slide 15: BFL Key Highlights
BFL Key Highlights Q1 FY 2021-22 ▪ Q1 FY22 AUM was at Rs. 1,590,569 Mn vs Rs. 1,380,546 Mn last year (15% growth); Core AUM accretion in Q1 FY22 was approximately ~ Rs. 41,000 Mn AUM & Business ▪ 4.63 Mn new loans in Q1 FY22 as against 1.75 Mn in Q1 FY21; Franchise Growth ▪ Acquired 1.88 Mn new cust
Slide 16: BFL Key Highlights
BFL Key Highlights Q1 FY 2021-22 ▪ Despite higher provisioning, profit after tax (PAT) for Q1 FY22 increased by 4% to Rs. 10,024 Mn compared to Rs. 9,623 Mn in Q1 Profitability & Capital FY21 Position ▪ Capital adequacy remained very strong at 28.57% as of 30 June 2021. Tier-1 capital was 25.41% Sub
Slide 17: BFL Q1 FY22 Highlights
BFL Q1 FY22 Highlights All Figures in Rs Million Performance Highlights of Q1 FY22 over Q1 FY21 (Ind AS) CY 1,531,433 67,430 10,024 16% 1% 4% PY 1,323,677 66,497 9,623 Book Size Total Income Profit After Tax CY 0.7% 2.7% Borrowing mix as of 30 June 2021 is 31:44:21:4 between banks, money markets, de
Slide 18: BFL: Book Size and Revenue
BFL : Book Size and Revenue All Figures in Rs Million Book Size Total Income Q1 FY22 FY21 growth of 4% FY21 growth of 1% growth of 16% 1,531,433 263,856 266,831 1,466,869 Q1 FY22 1,413,760 growth of 1% 1,323,677 66,497 67,430 FY20 FY21 Q1 FY21 Q1 FY22 FY20 FY21 Q1 FY21 Q1 FY22 Net Interest Income FY
Slide 19: BFL: Loan Loss Provision and Operating Expenses
BFL : Loan Loss Provision and Operating Expenses All Figures in Rs Million Loss Provision and Net NPA% 60,000 59,686 2.00% ❑ GNPA and NNPA in Q1 FY22 stood at 2.96% & 1.46% respectively as compared to 1.40% and 45,000 39,295 0.50% in Q1 FY21 1.46% 30,000 16,857 17,503 ❑ Standard assets provisioning
Slide 20: Bajaj Allianz General Insurance
Bajaj Allianz General Insurance 20
Slide 21: 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 22: Summary on COVID-19
Summary on COVID-19 ❑ Regional lockdowns imposed due to COVID-19 resulted in marginally lower growth for BAGIC in Q1 FY22 (9.1% (ex. Crop 11.1%) vs Industry# growth of 11.1%) ▪ Key business segments grew better than the market ▪ Motor: maintains strong growth in 2W & 4W segments but Commercial vehic
Slide 23: BAGIC Key Highlights
BAGIC Key Highlights Q1 FY 2021-22 ▪ GDPI grew by 9.1% in Q1 FY22 as against Industry# growth of 11.1% Revenue Growth ▪ Ex. Crop & Govt. Health, Q1 FY22 GDPI grew by 10.8% vs Industry growth of 11.6% ▪ Growth in Q1 was driven by Motor 4W (10.3%), 2W (23.0%), commercial * lines (14%) & Retail Health
Slide 24: BAGIC: Q1 FY22 Highlights
BAGIC : Q1 FY22 Highlights All Figures in Rs Million Performance Highlights of Q1 FY22 over Q1 FY21 CY 24,944 15,352 18,151 3,624 9% 12% 0% -8% PY 22,891 13,737 18,178 3,949 Gross Written Net Written Premium Net Earned Premium Profit After Tax Premium 5.0% ▪ Retail Growth at 9.8% (Ex. Crop, Govt. He
Slide 25: BAGIC: Combined Ratio
BAGIC : Combined Ratio Combined Ratios (Including Motor TP Pool Losses) 103.4% 100.8% 96.7% 96.9% 97.6% FY19 FY20 FY21 Q1 FY21 Q1 FY22 1. Combined Ratios are in accordance with the Master Circular on of Financial statements of General Insurance issued by IRDA effective from 1 April, 2013. (Net claim
Slide 26: BAGIC: Profit after tax and Capital efficiency
BAGIC : Profit after tax and Capital efficiency All Figures in Rs Million PAT Q1 FY22 PAT growth of -8% 13,301 9,988 7,799 3,949 3,624 FY19 FY20 FY21 Q1 FY21 Q1 FY22 Total Capital infused is Rs.2,768 Mn BAGIC - Capital Invested - Networth Accumulated profit* 97% of No Capital infusion since FY08 Net
Slide 27: BAGIC: Consistently amongst top private insurers in terms of Gross Premium
BAGIC : Consistently amongst top 2 private insurers in terms of Gross Premium; Industry GDPI Trend (Rs. Bn.) 1,785 1,856 Q1 FY22 GDPI growth of 14% 1,617 1,052 1,137 930 386 440 687 733 718 215 253 170 187 FY19 FY20 FY21 Q1 FY21 Q1 FY22 PSU Private Insurers* Industry BAGIC Premium Trend Q1 FY22 Prem
Slide 28: BAGIC: Balanced Product Mix
BAGIC : Balanced Product Mix Business Mix 8% 13% 9% 11% 10% 1% 13% 20% 19% 15% 33% 34% 13% 18% 14% 9% 9% 13% 14% 6% 5% 6% 7% 8% 44% 41% 38% 36% 35% -1% FY19 FY20 FY21 Q1 FY21 Q1 FY22 Motor (Retail) Health (Retail) Group Health Prop, Liability, Engg Agri (Crop Insurance) Others ▪ -crop GWP growth for
Slide 29: BAGIC: Diversified Channel Mix
BAGIC: Diversified Channel Mix Channel Mix 23% 27% 27% 20% 25% 37% 40% 37% 42% 43% 7% 3% 6% 2% 4% 12% 12% 10% 13% 11% 21% 20% 18% 21% 20% FY19 FY20 FY21 Q1 FY21 Q1 FY22 Individual Agents Corporate Agents - Banks Corporate Agents - Others Brokers Direct Business Bancassurance Agency & Retail OEMs & D
Slide 30: BAGIC: Assets Under Management
BAGIC : Assets Under Management AUM (cash and investments) Q1 FY22 growth of 20% BAGIC 231,502 235,049 continues to grow its AUM 196,115 strongly 187,458 172,367 Investments Rs. Million are largely in fixed income securities Investment Leverage of 2.96 as on 30 June 2021 FY19 FY20 FY21 Q1 FY21 Q1 FY
Slide 31: Digital initiatives
Digital Distributor Digital Issuance Onboarding Easy & few clicks policy Intermediaries onboarded digitally 100% issuance option 93.7% Digital Customer Digital Policy Servicing customer by going paperless 90.3% Omni & multichannel 54.7% experience Key Initiatives & Digital Adoption I Mitra/Ezeetab B
Slide 32: BAGIC: Risk Management
BAGIC : Risk Management Asset Quality Pricing & Underwriting ▪ 99.4% of the debt portfolio in AAA and ▪ Superior underwriting capability leading to sovereign assets low Combined Ratio consistently ▪ 88.7% of Equity in Nifty 50 stocks ▪ Diversified exposure across business lines & ▪ Oversight by Boar
Slide 33: Bajaj Allianz Life Insurance
Bajaj Allianz Life Insurance 33
Slide 34: BALIC Key Strategic Differentiators
BALIC Key Strategic Differentiators STRATEGY • Continued focus on sustainable and profitable growth by maintaining balanced product mix and investment in retail growth engines • Business construct is to maximize customer benefits while gaining market share in retail space, maintaining shareholder re
Slide 35: Summary on COVID-19
Summary on COVID-19 ❑ Despite the second wave of COVID-19 pandemic, BALIC reported industry beating Individual Rated New Business growth of 49%(vs both Q1 FY21 & Q1 FY20) & improvement in quality parameters ❑ Impact of second wave was more severe as increased infection rate and partial lockdowns dur
Slide 36: BALIC Key Highlights
BALIC Key Highlights Q1 FY 2021-22 ▪ In Q1 FY22, IRNB grew by 49% (vs Private Players growth of 26% & LIC growth of 4%. Overall industry growth of 16%) ▪ BALIC was the fastest growing LI (vs Q1 FY21 & Q1 FY20) among top 10 Revenue Growth & Market private players in this quarter Share ▪ Market share
Slide 37: BALIC Q1 FY22 Highlights
BALIC Q1 FY22 Highlights All Figures in Rs. Million Performance Highlights of Q1 FY22 over Q1 FY21 CY 4,934 7,621 12,195 25,155 49% 92% 27% 48% PY 3,306 3,974 9,579 16,997 Individual Rated NB Group NB Renewal Premium Gross Written Premium CY 840 253 648% Solvency Ratio as at -35% >100 % 30 June 2021
Slide 38: BALIC: New Business Value & New Business Margins
BALIC : New Business Value & New Business Margins All Figures in Rs. Million Rolling 12M Rolling 12M Q1 FY22 Q1 FY21 FY21 FY22 1 FY212 Annualized Premium (ANP)* 5,960 3,993 31,190 22,595 29,223 Net New Business Value (NBV)** 253 -135 3,999 2,124 3,608 Net New Business Margin (NBM) on ANP 4.2% -3.4%
Slide 39: BALIC Growth momentum continues
BALIC Growth momentum continues All Figures in Rs Million New Business Renewals GWP 57,116 63,132 120,248 45,735 51,790 97,525 2 years CAGR at 2 years CAGR at 2 years CAGR at 13% 22% 17% 12,960 12,195 9,579 25,155 10,140 8,227 18,367 7,418 16,997 FY20 FY21 Q1 FY20 Q1 FY21 Q1 FY22 FY20 FY21 Q1 FY20 Q
Slide 40: BALIC: Balanced product mix
BALIC : Balanced product mix IRNB Mix Share of Non-ULIP individual is increasing 41% 37% 39% Individual - Unit Linked 51% 60% Individual - Non Par Protection 5.9% 17% 7% 1.2% Individual - Non Par Savings 0.5% 20% 9% 20% 29% Individual - Annuity 33% 12% 1.6% Individual - Par 30% 0.1% 28% 23% 22% 13%
Slide 41: BALIC: Persistency
BALIC : Persistency Persistency 13th Month Persistency 25th Month 82% 71% 71% 71% 80% 79% 77% 69% Persistency - 13th Month Persistency - 25th Month FY20 FY21 Q1 FY21 Q1 FY22 FY20 FY21 Q1 FY21 Q1 FY22 Persistency 37th Month Persistency 49th Month Persistency 61st Month 63% 63% 56% 43% 54% 42% 58% 51%
Slide 42: BALIC: Individual Rated New Business
BALIC : Individual Rated New Business All Figures in Rs Million Whole Company Agency FY21 growth of 28% FY21 growth of 1% 24,676 10,826 10,977 Q1 FY22 growth Q1 FY22 growth 19,271 is 49% of 53% Industry beating growth Agency continues to stride ahead with substantial growth 4,934 1,845 2,378 3,322 3
Slide 43: BALIC: Diversified Distribution Mix
BALIC : Diversified Distribution Mix Individual Rated New Business Mix ❑ BALIC embarked on diversifying its distribution mix, scaling up alternate channels and enabling 10% 11% 11% 9% 9% wider presence by exploring alternate partnerships 20% ❑ Reduced over reliance on Agency channel with 33% 44% 43%
Slide 44: BALIC: Assets Under Management & Net Worth
BALIC : Assets Under Management & Net Worth • AUM as at 30 June 2021 grew by AUM (Mix) 27%; Growth in UL AUM stands at 36%; Traditional AUM grew 773 by 21% 738 561 610 Rs Billion 449 463 • Of the UL Funds of Rs. 310 Bn., 365 382 289 310 69% is equity as on 30 June 196 228 2021 (58% as on 30 June 202
Slide 45: Digital Initiatives to offer best in class customer experience
Digital Initiatives to offer best in class customer experience Smart Assist WhatsApp Co-Browsing capabilities : First Real Time servicing Platform time in India • 130,000+ Transactions Done in Q1 FY22, • Face-2-Face meetings NOW Screen-2- an increase of 8% over Q1 FY21 Screen (device agnostic platfo
Slide 46: BALIC: Risk Management
BALIC: Risk Management ❑ Prudent assumptions while pricing ❑ Stress and scenario testing performed at pricing stage Product Pricing ❑ Regular review of pricing based on prevailing interest rates ❑ ALM focused on cashflow matching & achieving an RISK MANAGEMENT immunized portfolio Asset Liability ❑ I
Slide 47: Additional Information BAGIC
Additional Information BAGIC
Slide 48: BAGIC: LOB Net Claim ratio & Growth (Major LOBs)
BAGIC : LOB Net Claim ratio & Growth (Major LOBs) Net Claim Ratio GDPI Growth Line of Business Q1 FY22 BAGIC Q1 FY22 Industry Q1 FY22 Q1 FY21 Growth Growth$ Fire 80.5% 118.1% 11.0% 4.1% Marine Cargo 91.1% 77.3% 13.1% 30.6% Motor OD 56.4% 50.8% 11.0% 7.3% Motor TP 78.5% 79.7% 4.2% 0.5% Motor Total 68
Slide 49: Additional Information BALIC
Additional Information BALIC
Slide 50: BALIC: Regular Premium Ticket Size
BALIC : Regular Premium Ticket Size All Figures in Rs. Whole Company Non Par Savings FY21 Q1 FY22 FY21 Q1 FY22 decrease of 6% Increase of 92% increase of 33% increase of 27% 69,851 61,716 57,782 39,929 36,579 31,555 36,465 27,437 FY20 FY21 Q1 FY21 Q1 FY22 FY20 FY21 Q1 FY21 Q1 FY22 Par Savings ULIPs
Slide 51: Disclaimer
Disclaimer This presentation has been prepared by Bajaj Finserv Limited (the 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 or issue any securities,
Slide 52: Thank You
BAJA FINSERV Thank You