Cholamandalam Financial Holdings Ltd · NSE:CHOLAHLDNG
Cholamandalam Financial — Investor Presentation (March 2019)
48 slides from Cholamandalam Financial's investor presentation, March 2019
Slide 1: Cholamandalam Financial Holdings Limited Corporate Presentation – FY19
CHOLAMANDALAM FINANCIAL HOLDINGS LIMITED (CFHL) CORPORATE PRESENTATION – FY19 1
Slide 2: Murugappa Group in a Nutshell
Murugappa Group in a Nutshell 118 Years of $5.05 Consolidated $10.3 Group Market Years Existence B Turnover B cap (as on 31st (FY18) Mar 2018) Listed 3 Sectors 28 Businesses 9 Companies 18 Geographical 90+ Manufacturing 35000 Work force Countries Presence Locations Locations + 2
Slide 3: Spirit of Murugappa
SPIRIT OF MURUGAPPA &S Chola Financial Holdings
Slide 4: Cholamandalam Financial Holdings Limited (CFHL) (Core Investment Company)
Cholamandalam Financial Holdings Limited (CFHL) (Core Investment Company) 46.39% 60.00% 49.50% Cholamandalam Cholamandalam MS Investment and Cholamandalam MS General Insurance Risk Services Limited Finance Company Company Limited Limited (CIFCL) (CMSRSL) (CMSGICL) • Subsidiary (as per Ind AS) • Join
Slide 5: Shareholding pattern & Share price movement
Shareholding pattern & Share price movement Shareholding Pattern Share Price movement as of March 31, 2019 10% 8% 6% 10% 4% 2% 0% 19% -2% 49% -4% -6% -8% -10% 22% -12% Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 CFHL Sensex Promoters Public Insitutions FII Mar-18 Jun-18 Sep-18 Dec-18 Mar-19 CFHL (Rs. / Share
Slide 6: First Time adoption of Ind AS
First Time adoption of Ind AS • Company has adopted Ind AS from April 1, 2018 with effective date of transition as April 1, 2017 in accordance with the road map prescribed by MCA for NBFCs. • CIFCL (NBFC subsidiary) and CMSRSL (Joint Venture) have also adopted Ind AS as above. • CMSGICL (Insurance s
Slide 7: Significant Ind AS adjustments - CIFCL
Significant Ind AS adjustments - CIFCL Particulars Ind AS implication Impairment on financial assets Ind AS follows expected credit loss model (ECL) that is based on parameters such as expected exposure at default, probability of default (PD), staging of advances and loss given default for various h
Slide 8: Significant Ind AS adjustments - CMSGICL
Significant Ind AS adjustments - CMSGICL Particulars Ind AS implication Measurement of Debt Instruments All investments are designated as Fair Value through PL (FVTPL) or Amortised Cost at instrument level based on certain factors (namely, interest yield, remaining tenor, etc.). ECL on such Investme
Slide 9: Net Profit Reconciliation – Consolidated Financials
Net Profit Reconciliation – Consolidated Financials Rs.in Cr. Year ended Particulars 31.03.2018 Net Profit After Tax as reported under Previous GAAP attributable to owners of the Company 599 Adjustments increasing/(decreasing) Net Profit After Tax as reported under Previous GAAP: Adoption of Effecti
Slide 10: Equity Reconciliation – Consolidated Financials
Equity Reconciliation – Consolidated Financials Rs.in Cr. Particulars As at March 31,2018 Equity as reported under previous GAAP 3,315 Adjustments Changes to Fair Value of Investments through OCI 2 Gain on Fair valuation of Debt & Equity Investments - FVTPL 2 Expected Credit Loss (ECL) provision on
Slide 11: Performance Highlights - Consolidated
Performance Highlights - Consolidated Rs.in Cr. Revenue Profit after tax Networth EPS (Rs.) FY19 10947 1415 3944 37.02 23% 26% 19% 23% FY18 8910 1127 3310 29.49 11
Slide 12: Performance Highlights - Consolidated
Performance Highlights - Consolidated Profit after tax Rs.in Cr. Rs.in Cr. CFHL CMSGICL CIFCL CMSRSL CFHL Consol CFHL CMSGICL CIFCL CMSRSL CFHL Consol 1 196 1217 1 1415 -1 192 935 1 1127 12
Slide 13: Financial Performance & Metrics
Financial Performance & Metrics CFHL - Standalone Particulars (Rs. in Cr) FY19 FY18 CIFCL FY19 FY18 Income 74 65 Disbursements (Rs. in Cr) 30,451 25,114 Expenses 3 3 AUM (Rs. in Cr) 54,271 42,924 Profit Before Tax 71 62 No.of Branches 900 873 Tax Expense 4 2 Profit After Tax 67 60 CMSGICL FY19 FY18
Slide 14: Cholamandalam Investment and Finance Company Limited (CIFCL)
Cholamandalam Investment and Finance Company Limited (CIFCL) 14
Slide 15: CIFCL: Financial Summary
CIFCL: Financial Summary (Rs. in Cr) Disbursements AUM 54,279 30,451 42,924 25,114 34,167 16,380 18,591 29,650 25,453 12,808 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 Profit After Tax Net worth 6,176 1,186 5,098 918 4,285 719 3,657 568 3,173 435 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 F
Slide 16: Provision analysis: IND AS vs IGAAP
Provision analysis: IND AS vs IGAAP Rs. in Cr Particulars Mar-18 Mar-19 As per IGAAP GNPA 1,325 1,245 NNPA 740 626 Provision 585 620 GNPA% 3.0% 2.3% NNPA% 1.7% 1.1% Provision Coverage% 44.2% 49.8% Standard Assets Provn 145 187 Standard Assets Provn % 0.40% 0.40% Total Provision 730 806 As per IND AS
Slide 17: Vehicle Finance
Vehicle Finance & Chola aye murugq| 1a Financial Holdings 17 SAPP
Slide 18: Auto Industry Outlook
Auto Industry Outlook Trend in Domestic LCV Sales Trend in Domestic SCV Sales (in Units) (in Units) CAGR @ 12% CAGR @ 14% 4,50,373 10,18,076 6,47,006 2,66,657 5,65,408 2,00,406 3,31,905 1,72,683 1,72,740 3,07,982 Mar-16 Mar-17 Mar-18 Mar-19 YTD Mar'23 Mar-16 Mar-17 Mar-18 Mar-19 YTD Mar'23 (E) (E) •
Slide 19: Auto Industry Outlook
Auto Industry Outlook Trend in Domestic HCV Sales Trend in Domestic Car & MUV Sales (in Units) (in Units) CAGR @ 6% CAGR @ 7% 3,72,938 41,62,682 2,95,402 30,18,149 31,14,258 31,75,690 2,65,425 27,55,733 2,38,513 2,38,165 Mar-16 Mar-17 Mar-18 Mar-19 YTD Mar'23 Mar-16 Mar-17 Mar-18 Mar-19 YTD Mar'23 (
Slide 20: Vehicle Finance—Business Model & Positioning
Vehicle Finance—Business Model & Positioning CV PV Low Industry Low Low Industry Low Chola Position Chola Position Principal Operator Salaried > 50 Vehicles Large Operators 26- 50 vehicles HCV Self Employed with Returns Returns Financials RISK RISK Medium Operators 10 -25 – HCV & LCV vehicles Taxi a
Slide 21: Vehicle Finance—Business Model & Positioning
Vehicle Finance—Business Model & Positioning Tractor CE Low Industry Low Low Industry Low Chola Position Super Strategic Chola Position Large Farmer Strategic Customer Captive Users / Prior Vehicles Captive Users/Prior Vehicles Returns Returns Medium Retail operator RISK RISK Medium Farmers Small Re
Slide 22: Vehicle Finance - Disbursement/Portfolio Mix – FY19
Vehicle Finance - Disbursement/Portfolio Mix – FY19 Well diversified across product segments Disbursements - Product wise Portfolio - Product wise Older Tractor, 7% Older Tractor, 7% Vehicles, CE, 5% CE, 5% Vehicles, 13% 15% HCV, 14% HCV, 17% Refinance, 12% Refinance , 14% LCV, 20% 3Whlr and LCV, 22
Slide 23: Vehicle Finance - Disbursement/Portfolio Mix – FY19
Vehicle Finance - Disbursement/Portfolio Mix – FY19 Well diversified across geography Disbursements - State wise Portfolio - State wise MP AP MP AP Karnataka Karnataka Maharashtra Maharashtra Kerala Kerala 6% 5% 5% 5% 6% Pondicherry 5% Pondicherry 10% 12% Telangana 4% Telangana 4% Gujarat 0% 0% Guja
Slide 24: Vehicle Finance: Financial summary FY19 (I)
Vehicle Finance: Financial summary FY19 (I) (Rs. in Cr) Disbursements Assets under management 24,807 - 20,540 - 40,588 - 31,440 14,471 12,383 23,631 9,363 20,100 17,639 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 24
Slide 25: Vehicle Finance: Financial summary FY19 (II)
Vehicle Finance: Financial summary FY19 (II) (Rs. in Cr) Income Profit before tax 5,424 1,278 4,190 3,159 3,609 996 2,909 555 682 346 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 25
Slide 26: Home Equity
Home Equity & Chola aye murugq| 1a Financial Holdings 26 SAPP
Slide 27: Home Equity— FY19 Performance
Home Equity— FY19 Performance Disbursements • Disbursements has grown 21% in FY19 as compared to FY18 • The business has grown the Assets by 15% in FY19. Pre-closures are Asset under being controlled by better customer engagement, though it continues management to grow. Loss and provisions • Loan lo
Slide 28: Home Equity—Financial Summary FY19 (I)
Home Equity—Financial Summary FY19 (I) (Rs. in Cr) Disbursements Assets under Management 15% 3,837 11,626 3,476 9,593 10,095 3,043 3,056 3,174 8,852 7,280 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 28
Slide 29: Home Equity—Financial Summary FY19 (II)
Home Equity—Financial Summary FY19 (II) (Rs. in Cr) Income Profit before tax 5% 1,217 1,247 1,124 1,184 305 941 261 240 207 221 FY15 FY16 FY17 FY18 FY19 FY15 FY16 FY17 FY18 FY19 29
Slide 30: Cholamandalam MS General Insurance Company Limited (CMSGICL)
Cholamandalam MS General Insurance Company Limited (CMSGICL) 30
Slide 31: Growth of the Insurance Industry in India
Growth of the Insurance Industry in India General insurance GWP* (Rs in Cr) Life insurance NBP (Rs in Cr) 169965 150593 214673 193866 128213 175022 89000 29400 39600 18400 FY'05 FY'09 FY'17 FY'18 FY'19 FY'05 FY'09 FY'17 FY'18 FY'19 SOURCE: IRDA & RBI * Note: * GWP ofGWP Note: PSU, Private, of PSU, S
Slide 32: Industry has witnessed steady growth
Industry has witnessed steady growth Industry Size & Yoy Growth Industry Forecast In Rs. In Cr 32% 390000 180000 169965 33% 340000 326000 160000 150593 28% 140000 23% 23% 290000 128213 235000 120000 18% 240000 18% 12% 96394 190000 100000 17% 13% 190000 84686 80000 69086 77541 14% 13% 8% 140000 58357
Slide 33: Retail is the Major Trust Area for the Industry
Retail is the Major Trust Area for the Industry General Insurance GWP by Lines of Business (LOB) Mix (%)* GWP (Rs In Cr) 48% 48% 44% 45% 43% 22% 23% 23% 23% 24% 15% 14% 14% 20% 19% 12% 13% 14% 9% 7% 7% 6% 7% FY'15 FY'16 FY'17 FY'18 FY'19 Others Crop Commercial Health Motor Crop premiums contribute
Slide 34: General Insurance Industry – Penetration
General Insurance Industry – Penetration Insurance Penetration (% of GDP) 2.3% 2.1% 1.7% 1.7% 1.6% 1.3% 1.2% 0.8% 0.7% Density & Penetration low in India compared to other countries Increase in penetration can happen with growth of personal lines, product enrichment, catering to rural masses, in
Slide 35: Chola MS – Performance Snapshot
Chola MS – Performance Snapshot Management Philosophy GWP Since Inception (INR CR) Vision: We will be the preferred choice for our clients, 4429 business partners and employees through core values of 4103 Trust and Transparency aided by Technology – T3 – Our 3133 brand philosophy. 2452 1855 1890 1
Slide 36: Current Partnerships – Auto OEM's & Financiers
Current Partnerships – Auto OEM’s & Financiers Banks Small Finance Bank/Gramin Banks NBFC’s PV CV Tractors 36
Slide 37: Serving ~19,000 branches of PSU Banks Pan India
Serving ~19,000 branches of 5 PSU Banks Pan India Bank Of Baroda, Dena Bank, Oriental Bank of Commerce & Union Bank of India North West State Total State Total UP and Uttrakhand 3478 Gujarat 2291 Punjab 977 Maharashtra, Mumbai, Goa 2211 Delhi/ NCR/Haryana 1151 Rajasthan 1137 Himachal and J&K 122 MP
Slide 38: Chola MS LOB wise Performance
Chola MS LOB wise Performance GWP ( Rs in Cr) MIX% LOB's CAGR% FY'15 FY'16 FY'17 FY'18 FY'19 FY'15 FY'16 FY'17 FY'18 FY'19 Fire 124 205 236 326 265 20.90% 6.60% 8.40% 7.50% 7.90% 6.00% Marine 64 76 68 71 75 4.00% 3.40% 3.10% 2.20% 1.70% 1.70% Engg 25 21 25 28 36 9.50% 1.30% 0.80% 0.80% 0.70% 0.80% M
Slide 39: Chola MS Channel wise Performance
Chola MS Channel wise Performance GWP (Rs in Cr) MIX% Particulars CAGR% FY'15 FY'16 FY'17 FY'18 FY'19 FY'15 FY'16 FY'17 FY'18 FY'19 A. Banca/NBFC’s 906 1236 1522 1875 2060 22.80% 47.90% 50.40% 48.60% 45.70% 46.50% B. OEM Channels 640 757 870 646 662 0.80% 33.80% 30.90% 27.70% 15.70% 14.90% C. Retail
Slide 40: Key Financial Indicators
Key Financial Indicators Gross Direct Written Premium – Rs. Crs CAGR 18% 31% Profit Before Tax (Rs. Crs) 5000 4429 4541 35% 4500 4103 30% 28% 30% 347 4000 3133 25% 297 288 280 3500 3000 20% 251 1855 2452 20% 213 2500 201 1621 1890 15% 2000 1500 14% 10% 89 102 1000 2% 500 8.0% 5% 16 0 0% FY'13 FY'14
Slide 41: Financial Highlights
Financial Highlights Particulars – In Rs. Cr FY’09 FY’10 FY’11 FY’12 FY’13 FY’14 FY’15 FY’16 FY’17 FY’18 FY’19 I GAAP IND AS I GAAP IND AS Gross Written Premium 685 785 968 1347 1621 1855 1890 2452 3133 4103 4103 4429 4541 Net Earned Premium 385 462 627 869 1167 1431 1482 1691 2248 2824 2824 3050 30
Slide 42: Appendix: ECL methodology
Appendix ECL methodology S&S Chola Financial Holdings
Slide 43: Measurement Framework
Measurement Framework Measurement Framework Asset ECL classification PD12m Stage 1 LGD EAD Staging Lifetime ECL Retail Stage 2 Framework Basis Account Conduct it is classified into different stages PD : Probability of default PD(100 %) LGD : Loss given default Stage 3 LGD EAD : Exposure at t
Slide 44: Measurement Framework
Measurement Framework Asset ECL Description classification PD12m • Assets with low risk (0-30 DPD) on reporting date Stage 1 LGD • Loss estimate based on a 1 year forward estimate EAD Lifetime • Assets with Significant Increase in Credit Risk (SICR) since initial recognition Stage 2 • Assets wit
Slide 45: Retail Pooling
Retail Pooling Chola Portfolios are segmented based on the below categories. PD term structure and LGDs are computed for each segment separately. Home Vehicle Finance Home Equity Others Loan MLCV/2W/3 HE Tamil HCV New LCV New W New HE Delhi Nadu HE Punjab / CAR/MUV Haryana / New USED SHUBH HE Gujara
Slide 46: Contact us
Contact us Cholamandalam Financial Holdings Limited (CFHL), Dare House, No. 234, NSC Bose Road, Parrys, Our registered Chennai 600001. office Land Line: 044–40907638 http://www.cholafhl.com Email-ID Krithika E - Company Secretary–krithikae@tifhl.murugappa.com 46
Slide 47: Disclaimer
Disclaimer • Certain statements included in this presentation may be forward looking statements made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Cholamandalam Financial Holdings Ltd and its subsidiaries. There can be no assur
Slide 48: Thank You
& Chola Financial Holdings Thank You ake murugappa
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