Cholamandalam Financial Holdings Ltd · NSE:CHOLAHLDNG
Cholamandalam Financial — Q3 FY23 Earnings Presentation
73 slides from Cholamandalam Financial's earnings presentation, Feb 9, 2023
Slide 1: Cover letter to stock exchanges: Presentation to Analyst / Investor
February 9, 2023 The Manager The Secretary Listing Department BSE Limited, National Stock Exchange of India Ltd 25th Floor, Phiroze Jeejeebhoy Towers, Exchange Plaza, 5th Floor Dalal Street, Fort, Plot No.C-1, Block G Mumbai 400 001 Bandra-Kurla Complex Bandra (E) Mumbai 400 051 Symbol : CHOLAHLDNG
Slide 2: Corporate Presentation – Q3-FY23
CHOLAMANDALAM FINANCIAL HOLDINGS LIMITED CORPORATE PRESENTATION – Q3-FY23 1
Slide 3: Murugappa Group in a Nutshell
Murugappa Group in a Nutshell Consolidated Group Market 122 Years of $7.0 $26.7 Turnover cap (as on 31st Years Existence B B (FY22) Dec 2022) Listed 3 Sectors 29 Businesses 10 Companies 40 Geographical 105 Manufacturing 53,000+ Work force Countries Presence Locations Locations 2
Slide 4: Murugappa Group Overview
Murugappa Group Overview Murugappa Group Agriculture Engineering Financial services Market Cap(Cr.) 39,738 1,11,518 69,767 Turnover (Cr.) 23,431 8,432 15,049 PAT(Cr.) 1,788 1,341 2,305 Market Cap(Cr.) 25,963 10,093 16,603 53,576 59,421 NA 10,347 Turnover (Cr.) 19,068 4,363 3,290 15350 10,141 4.824 8
Slide 5: Spirit of Murugappa
SPIRIT OF MURUGAPPA “The fundamental principle of economic activity is that no man you transact with will lose, then you shall not." 4
Slide 6: Cholamandalam Financial Holdings Limited (Core Investment Company)
Cholamandalam Financial Holdings Limited (CFHL) (Core Investment Company) 45.37% 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 7: Shareholding pattern
Shareholding pattern Shareholding Pattern Institutional Holders (More than 1%) as of December 31, 2022 Top Domestic Institutional Holdings * ICICI Mutul Fund 14.21% * Aditya Birla Mutul Fund * HDFC Mutul Fund 11.47% 48.61% * Nippon India Mutual Fund * Sundaram Mutul Fund 25.71% * Axis Mutul Fund Top
Slide 8: Performance Highlights - Consolidated
Performance Highlights - Consolidated Rs.in Cr. Revenue Profit after tax EPS (Rs.) Q3 FY23 4,777 720 17.69 28% 33% 33% Q3 FY22 3,744 543 13.26 Rs.in Cr. Revenue Profit after tax EPS (Rs.) YTD Dec-22 13,095 1,909 46.99 20% 23% 23% YTD Dec-21 10,941 1,553 38.27 7
Slide 9: Performance Highlights – Consolidated
Performance Highlights – Consolidated Profit After Tax (Rs.in crs) 800 700 720 600 685 500 543 528 400 300 200 100 35 16 1 - -100 CIFCL CMSGICL Others-0 CFHL Consol Q3 FY23 Q3 FY22 Profit After Tax (Rs. in crs) 2,500 2,000 1,909 1,810 1,500 1,467 1,553 1,000 500 95 84 4 2 - CIFCL CMSGICL Others CFHL
Slide 10: Financial Performance & Metrics
Financial Performance & Metrics CFHL - Standalone CIFCL YTD Dec-22 YTD Dec-21 Particulars (Rs. in Cr) YTD Dec-22 YTD Dec-21 Disbursements (Rs. in Cr) 45,512 22,772 As of As of Income 33 33 31-Dec-2022 31-Mar-2022 Expenses 7 9 AUM (Rs. in Cr) 1,03,789 82,904 Profit Before Tax 26 24 No.of Branches 1,1
Slide 11: Regulatory Ratios of CFHL
Regulatory Ratios of CFHL Rs Crs As of As of Particulars December 31, 2022 March 31, 2022 Owned Funds (A) 1,191.90 1,187.17 Adjusted Networth (B) 14,534.54 12,072.90 Risk Weighed Assets ( C) 1,281.65 1,280.57 Outside Liabilities (D) 107.06 103.73 Net assets (E) 1,280.50 1,279.89 Investment in equity
Slide 12: Cholamandalam Investment and Finance Company Limited
Cholamandalam Investment and Finance Company Limited 11
Slide 13: Disbursements
Disbursements Disbursements (₹Cr) Disbursements (%) * 45,512 2% 5% 6% 6% 5% 9,040 6% 16% 6% 20% 21% 5% 22% 13% 10% 2,425 5% 16% 16% 5% 6% 6% 15% 6,537 15% 13% 14% * 22,772 1,104 1,347 * 17,559 3,666 80% 78% * 14,623 3,787 73% 73% * 13,329 27,509 64% 3,132 * 10,430 1,072 58% 59% 60% 2,121 * 8,706 611
Slide 14: Assets Under Management
Assets Under Management Business - Assets under Management (₹Cr) Business - Assets under Management (%) * 95,468 * 87,668 6,907 * 81,925 4,765 7,278 2,937 1% 1% 6,454 4% 5% 1% 5,938 * 72,724 7% 7% 7% * 70,023 7% * 67,821 792 19,997 7% 8% 502 551 5,255 8% 4,880 18,843 21% 22% 4,407 17,675 22% 22% 21%
Slide 15: Profitability and Net worth
Profitability and Net worth Profit after tax (₹Cr) Networth (₹Cr) *13,530 *12,849 164 *12,316 164 164 1813 *11,074 *10,421 164 *9,887 164 164 1457 13,366 12,152 12,684 10,909 9,723 10,256 684 566 607 563 524 327 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 FY22 FY23 FY22 FY23 FY22 FY23 Dec21 Dec22 FY
Slide 16: Chola – Stage 3 Assets Trend
Chola –Stage 3 Assets Trend Chola 44.27% 43.52% 42.93% 12.00% 41.52% 41.62% 41.48% 40.69% 40.96% 39.67% 38.80% 40.00% 10.00% 36.45% 35.51% 8.00% 35.00% 6.79% 6.16% 5.85% 6.00% 2.41% 30.00% 2.24% 4.37% 4.16% 3.80% 3.75% 3.96% 2.27% 3.84% 3.34% 3.51% 4.00% 2.98% 1.73% 1.58% 1.63% 1.75% 1.59% 1.39% 1.4
Slide 17: Vehicle Finance
Vehicle Finance Primary Colours 16
Slide 18: Vehicle Finance: YTD Dec22 Performance
Vehicle Finance: YTD Dec22 Performance • Disbursements grew by 65% in YTD Dec22 to Rs.27,509 Cr as Disbursements compared to Rs.16,654 Cr in YTD Dec21. Assets under • AUM have grown by 21% YoY. management Loss and • Loan losses dropped to 1.5% in YTD Dec22 as compared to 1.9% in provisions YTD Dec21
Slide 19: Sector outlook – Vehicle Finance business (1/3)
Sector outlook – Vehicle Finance business (1/3) Sector Outlook Chola’s Position ▪ The Light Commercial Vehicle segment had a ▪ Increased demand for Light Commercial Vehicle will growth of 14% in Q3 FY23 & 47% in YTD Dec22. help us garner higher volumes. However, we will be The segment is witnessing
Slide 20: Sector outlook – Vehicle Finance business (2/3)
Sector outlook – Vehicle Finance business (2/3) Sector Outlook Chola’s Position ▪ The Passenger Vehicle (Car & MUV) segment ▪ Our focus continues to be on retail customers had a growth of 23% in Q3 FY23 which is the especially in smaller towns and rural areas. We second highest sales for any quarter
Slide 21: Sector outlook – Vehicle Finance business (3/3)
Sector outlook – Vehicle Finance business (3/3) Sector Outlook Chola’s Position ▪ The Construction Equipment segment had a ▪ Our exposure in this segment is around growth of 25% in Q3 FY23 & 28% in YTD 6% at a portfolio level and our focus will Dec22. Volumes are expected to pickup in be on building
Slide 22: Auto Industry Outlook
Auto Industry Outlook Trend in Domestic LCV Sales Trend in Domestic SCV Sales (in Units) (in Units) 1,86,795 1,01,553 Chola @ 30% Chola @ 6% CAGR @ 15% CAGR @ 15% 14% (8%) 1,05,589 58,747 97,398 99,277 52,862 92,870 50,490 46,679 Q3 FY20 Q3 FY21 Q3 FY22 Q3 FY23 Q3 FY27 (E) Q3 FY20 Q3 FY21 Q3 FY22 Q3
Slide 23: Auto Industry Outlook
Auto Industry Outlook Trend in Domestic HCV Sales Trend in Domestic Car & MUV Sales (in Units) 1,02,855 Chola @ 62% (in Units) Chola @32% CAGR @ 15% 12,26,139 42% 72,770 23% 8,97,983 9,36,306 CAGR @ 10% 7,86,477 7,61,336 51,137 40,765 37,186 Q3 FY20 Q3 FY21 Q3 FY22 Q3 FY23 Q3 FY27 (E) Q3 FY20 Q3 FY2
Slide 24: 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 25: 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 26: Vehicle Finance - Disbursement/Portfolio Mix – Q3 FY23
Vehicle Finance - Disbursement/Portfolio Mix – Q3 FY23 Well diversified across geography Disbursements - State wise Portfolio - State wise MP AP MP AP Karnataka Karnataka Maharashtra Maharashtra 6% 6% 6% 5% Kerala Kerala 7% 6% Puducherry 11% 10% Gujarat Puducherry 5% Telangana 4% Gujarat 0% 0% Telan
Slide 27: Vehicle Finance - Disbursement/Portfolio Mix – Q3 FY23
Vehicle Finance - Disbursement/Portfolio Mix – Q3 FY23 Well diversified product segments Disbursements (%) - Product wise Portfolio (%) - Product wise 3 Wheeler 3 Wheeler HCV CE 1% HCV CE 0.3% 7% 6% 5% 7% 2 Wheeler LCV 2 Wheeler 6% 18% LCV 9% 21% MUV 9% Used Vehicles MUV 27% Used Vehicles 8% 30% CAR
Slide 28: Vehicle Finance - Disbursement Mix – Quarter-wise
Vehicle Finance - Disbursement Mix – Quarter-wise Disbursement (₹Cr) - Product wise Disbursement (%) – Product wise * 10,446 6% 7% 6% 6% 7% 687 4% 6% 8% 6% 5% * 8,785 560 * 8,562 * 8,502 17% 19% 17% 572 502 468 1,816 18% 19% * 7,647 664 556 479 Yield Low 447 7% 333 925 7% 9% 9% 9% 1,579 1,595 1,604
Slide 29: Vehicle Finance - Portfolio Mix – Quarter-wise
Vehicle Finance - Portfolio Mix – Quarter-wise Portfolio (₹Cr) - Product wise Portfolio (%) – Product wise 6% 6% 6% 6% 7% * 61,285 8% 7% 7% 7% 7% * 57,606 * 55,376 3,990 * 52,881 3,666 4,126 * 50,675 Medium Yield Low Yield 3,557 21% 21% 21% 21% 21% 3,395 4,015 3,189 4,000 3,914 12,810 3,937 12,305 7
Slide 30: Vehicle Finance - Disbursements and Asset Under Management
Vehicle Finance - Disbursements and Asset Under Management Disbursements (₹Cr) Assets under management (₹Cr) 27,509 * 61,285 *57,606 305 *55,376 417 547 * 50,675 *48,403 *49,285 891 1,295 1,103 16,654 60,980 54,829 57,189 10,446 47,108 48,182 49,785 8,562 8,502 7,647 6,161 2,846 Q1 Q1 Q2 Q2 Q3 Q3 YT
Slide 31: Vehicle Finance - Income and Profit before tax
Vehicle Finance - Income and Profit before tax Income (₹Cr) Profit before tax (₹Cr) 6,403 1,538 5,757 1,369 591 590 2,133 2,257 521 1,916 2,013 1,903 1,938 480 468 258 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY22 FY23 FY22 FY23 FY22 FY23 Dec21Dec22 FY22 FY23 FY22 FY23 FY22 FY23 Dec21 Dec
Slide 32: Loan Against Property
Loan Against Property ary Colours 31
Slide 33: Loan Against Property – YTD Dec22 Performance
Loan Against Property – YTD Dec22 Performance • Disbursements grew by 78% in YTD Dec22 at Rs.6,537 Cr as Disbursements compared to Rs.3,666 Cr in YTD Dec21. Asset under • AUM grew by 25% YoY. management Loss and provisions • Loan losses dropped to 0.02% in YTD Dec22 from 1.1% in YTD Dec21. Profit be
Slide 34: Loan Against Property: Industry outlook
Loan Against Property: Industry outlook Sector Outlook Chola’s Position • CRISIL expects MSME LAP segment to grow at 6-8% in FY23, driven by improving economic conditions and the • Chola’s LAP team is currently focusing on increasing mild impact of the third pandemic wave, assisting in its market sh
Slide 35: Loan Against Property - Disbursements and Asset Under Management
Loan Against Property - Disbursements and Asset Under Management Disbursements (₹Cr) Assets under Management (₹Cr) * 19,997 78% * 18,843 6,537 1,205 * 17,675 1,318 1,418 * 16,218 * 15,421 * 14,513 1,680 1,828 1,961 3,666 18,792 17,525 38% 36% 16,257 14,537 13,592 12,552 2,246 2,255 2,036 1,661 1,624
Slide 36: Loan Against Property – Income and Profit before tax
Loan Against Property – Income and Profit before tax Income (₹Cr) Profit before tax (₹Cr) 564 1,640 1,335 296 597 200 178 186 540 503 432 440 463 130 101 65 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY22 FY23 FY22 FY23 FY22 FY23 Dec21 Dec22 FY22 FY23 FY22 FY23 FY22 FY23 Dec21 Dec22 35
Slide 37: Home Loans
Home Loans Primary Colours 36
Slide 38: Home Loans – YTD Dec22 Performance
Home Loans – YTD Dec22 Performance • Disbursements grew by 80% in YTD Dec22 at Rs.2,425 Cr as Disbursements compared to Rs.1,347 Cr in YTD Dec21. Asset under • AUM have grown by 39% YoY. management Loss and provisions • Loan losses dropped to 0.6% in YTD Dec22 from 1.3% in YTD Dec21. Profit before t
Slide 39: Home Loans - Industry outlook
Home Loans - Industry outlook Sector Outlook Chola’s Position • Demand remained robust in Q3 FY23 and Affordable • Chola continues to expand its geographical footprint HFC growth continues to be pegged at 17-20% in in the North, East & West Zones while continuing to FY23. deepen its footprint in the
Slide 40: Home Loans - Disbursements and Asset Under Management
Home Loans - Disbursements and Asset Under Management Disbursements (₹Cr) Assets under Management (₹Cr) 2,425 *7,278 456 *6,454 *5,938 478 500 *5,255 *4,880 *4,407 553 579 1,347 602 6,822 1,072 5,976 5,438 4,301 4,702 743 3,805 611 605 539 203 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 FY22 FY23 FY
Slide 41: Home Loans - Income and Profit before tax
Home Loans - Income and Profit before tax Income (₹Cr) Profit before tax (₹Cr) 680 223 502 150 103% 254 222 85 204 74 167 181 64 154 51 58 42 Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD Q1 Q1 Q2 Q2 Q3 Q3 YTD YTD FY22 FY23 FY22 FY23 FY22 FY22 Dec21 Dec22 FY22 FY23 FY22 FY23 FY22 FY23 Dec21 Dec22 40
Slide 42: Funding Profile
Funding Profile <&} Chola aXe 41 Murugappa Financial Holdings
Slide 43: CAR and Credit Rating
CAR and Credit Rating Capital Adequacy Ratio (CAR) – As per RBI guideline Tier I Tier II 19.07 19.62 19.15 18.40 17.75 3.93 3.13 2.90 2.63 2.63 15.14 16.49 16.25 15.77 15.12 FY21 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Minimum CAR Stipulated by RBI is 15% & for Tier I is 10% Credit Rating Loan type India ratin
Slide 44: Diversified Borrowings Profile (I/II)
Diversified Borrowings Profile (I/II) Borrowing mix by instrument type (₹Cr) * 65,806 * 69,174 * 73,929 * 79,321 * 89,305 4% 4% 6% 7% 2% 7% 2% 2% 5% 2% 3% 5% 6% 7% 6% 9% 4% 5% 7% 2% 2% 2% 4% 2% 4% 15% 17% 18% 14% 18% 57% 61% 58% 58% 52% 6% 6% 5% 5% 4% Q3 FY22 Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY23 Tier II
Slide 45: Diversified Borrowings Profile (II/II)
Diversified Borrowings Profile (I/II) (₹Cr) Borrowing mix by investor type * 65,806 * 69,174 * 73,929 * 79,321 * 89,305 5% 5% 6% 7% 9% 2% 3% 3% 2% 2% 2% 3% 3% 6% 5% 3% 1% 4% 1% 3% 66% 66% 66% 69% 64% 1% 1% 1% 1% 4% 1% 5% 5% 6% 4% 11% 9% 11% 9% 10% 3% 3% 4% 3% 3% Q3 FY22 Q4 FY22 Q1 FY23 Q2 FY23 Q3 FY
Slide 46: ALM Statement as of 31st Dec 2022 (As per IND AS)
ALM Statement as of 31st Dec 2022 (As per IND AS) (₹Cr) ALM snapshot as on 31st Dec 2022 Particulars 1m >1 to 2m >2 to 3m >3 to 6m >6m to 1 yr >1 to 3 yr >3 to 5 yr >5 yr Total Cash & Bank Balances 3,195.00 374.28 2,708.85 0.80 - - - 1,117.34 7,396.27 Advances 4,464.06 4,236.56 2,231.66 9,091.69 15,
Slide 47: Cholamandalam MS General Insurance Company Limited
Cholamandalam MS General Insurance Company Limited Financial data in this section is as per IGAAP 46
Slide 48: Chola MS General Insurance: Brief Overview
Chola MS General Insurance: Brief Overview Murugappa Group Mitsui Sumitomo Insurance, Japan ◼ Murugappa Group - India's leading business ◼ Mitsui Sumitomo Insurance - part of MS&AD – one of conglomerate the largest insurance group in the world. ◼ MS&AD is the 8th largest insurance group in the ◼ Fou
Slide 49: Key Financial Parameters (Rs. Crs)
Key Financial Parameters (Rs. Crs) YTD Dec YTD Dec Particulars – In Rs. Cr FY'20 FY’21 FY'22 Q3 FY'22 Q3 FY'23 FY'22 FY'23 Gross Written Premium 4398 4388 4824 1320 1625 3442 4389 Growth -0.7% -0.20% 9.90% 13.09% 23.11% 10.39% 27.51% NWP 3409 3357 3572 952 1259 2521 3289 NEP 3437 3202 3437 875 1035
Slide 50: LOB Wise - Quarterly Growth Trends
LOB Wise - Quarterly Growth Trends Other Comml Particulars Months Fire Motor Health PA Crop Others Total Lines Q1 FY'23 12.8% 28.1% 27.5% 19.6% -5.5% 135.0% 42.4% 22.7% In Q3, Chola MS Q2 FY'23 8.5% 26.4% 12.6% 11.3% 9.4% -9.5% 28.1% 9.0% Industry Q3 FY'23 9.7% 5.6% 12.7% 24.2% 22.9% 77.5% 18.3% 18.
Slide 51: Among the Top ranked GI Players supported by strong growth
Among the Top ranked GI Players supported by strong growth YTD Dec FY’23 Solid GWP growth over years (CAGR FY2016 - FY 2022 = 12% (With Crop); 13.0% (Without Crop) Rs In Crs Growing Market Share 4429 4398 4388 4824 4103 4389 3133 3442 2452 2851 3602 3992 4379 4386 4824 3442 4389 5.3% 2313 282 19 Mar
Slide 52: Key Financial Indicators
Key Financial Indicators GWP (INR Cr) and Growth (%) Return on Net Worth(%) FY’22 Excluding exceptional item RoNW @ 9.13% 27.5% 600 0 4824 23.1% 30. 0% # 4398 4388 14.9% 25. 0% 4389 500 0 3442 20. 0% 13.1% 10.4% 400 0 9.9% 15. 0% 300 0 9.3% * 10. 0% 200 0 1320 1625 5.6% -0.7% -0.2% 5.0 % 3.9% 100 0
Slide 53: Constantly improving operating metrics
Constantly improving operating metrics YTD Dec YTD Dec Particulars 2018-19 2019-20 2020-21 2021-22 2021-22 2022-23 Number of Customers (Live Customer) No in Lacs 100 141 165 254 245 314 Number of policies issued No in Lacs 29 45 63 99 70 86 Market Presence(Branch + CIE + VO) No’s 559 645 593 638 632
Slide 54: Loss Ratio (%)
Loss Ratio (%) YTD Dec YTD Dec Line of Business FY2020 FY2021 FY'22 Q3 FY'22 Q3 FY'23 FY'22 FY'23 Motor OD 61.9% 57.0% 69.8% 69.1% 68.8%^ 65.2% 71.5% Motor TP 90.7% 79.7% 63.4%* 64.1%* 75.7% 62.3%* 76.6%# Motor Total 83.0% 74.3% 65.1% 65.4% 73.8% 63.1% 75.2% Health, Travel & PA 40.8% 77.2% 117.1% 71
Slide 55: Investment Book Overview (Rs. Crs)
Investment Book Overview (Rs. Crs) Category Dec-20 Dec-21 Dec-22 Dec-20 Dec-21 Dec-22 C Govt Sec 4053 4371 6160 38.7% 36.4% 44.1% S Govt Sec 3516 3233 3130 33.6% 26.9% 22.4% Housing sector 893 1029 1984 8.5% 8.6% 14.2% Infra sector 722 1514 1663 6.9% 12.6% 11.9% Approved - Other Corp Bonds 431 250 4
Slide 56: Dominance in Motor, Diversification Underway
Dominance in Motor, Diversification Underway Motor Market Share (Largest GI Segment) Strategized diversification across Motor eco-system GI Market Share by GWP 83.0% 74.3% 65.1% 63.1% 75.2% 5.3% 10.1% 16.4% 23.1% 23.0% 20.5% 4.9% 4.9% 22.1% 25.4% 29.3% 29.4% 35.6% 4.7% 4.6% 67.9% 58.2% 47.6% 47.7% 4
Slide 57: Dominance in Motor, Gaining Prominence in Other Segment
Dominance in Motor, Gaining Prominence in Other Segment 0.4% 0.0% 0.0% 0.0% 0.0% 7.7% 6.3% 6.7% 6.6% 6.7% 10.9% 13.0% 13.4% 13.5% 14.3% 7.2% 9.4% 9.0% 9.0% 9.7% 73.8% 71.2% 70.9% 71.0% 69.3% FY'20 FY'21 FY'22 YTD Dec FY'22 YTD Dec FY'23 Motor Health Commercial PA & Others Crop ▪ Focus on Commercial
Slide 58: Retail Focused Diversified Operations
Retail Focused Diversified Operations Retail dominated business mix Granular book aided by increasing dispersed customer base Customers (#) in Lacs 314 Commercial 254 15.1% 165 141 Retail 84.9% FY'20 FY'21 FY'22 YTD Dec FY'23 Significant growth in retail oriented policies Geographic Presence – Mix %
Slide 59: Multi-channel model ensures lesser concentration & diversified revenue Stream
Multi-channel model ensures lesser concentration & diversified revenue Stream Channel wise Mix% 0.0% 0.0% 0.1% 0.2% 0.0% 0.3% 0.4% 0.5% 0.5% 0.3% 3.7% 6.7% 4.7% 4.6% 5.7% 4.4% 5.2% 5.1% 5.6% 6.7% 21.2% 20.8% 18.9% 32.6% 27.5% 25.0% 32.5% 31.7% 38.3% 20.9% 34.1% 35.9% 34.9% 34.5% 30.9% FY'20 FY'21 FY
Slide 60: Volume Growth aided by OEMs volumes
Volume Growth aided by OEMs volumes GWP Mix% 8.1% 11.5% 12.3% 13.0% 13.4% 28.6% 30.5% 31.9% 31.8% 28.0% 17.2% 19.2% 23.2% 28.2% 23.0% 46.1% 38.8% 32.6% 32.2% 30.4% FY'20 FY'21 FY'22 YTD Dec FY'22 YTD Dec FY'23 Financers OEM Agency Others* ▪ Volumes from financiers on the rise * Others includes large
Slide 61: Balanced Revenue Mix: Stable in-house + Growth Channels
Balanced Revenue Mix: Stable in-house + Growth Channels Captive Channel Long Lasting Channel Other Tied Channels (CIE + Chola Finance + Coromandel) (IBL + Toyota) (PSU Banca, NBFC, OEM) 30.9% of 13.3% of YTD Dec FY’23 GWP 35.9% of YTD Dec FY’23 GWP YTD Dec FY’23 GWP GWP Rs In Crs GWP Rs In Crs GWP R
Slide 62: Tech Enablers across the value chain
Tech Enablers across the value chain Channels Platforms Service Improvement (Products & Services) (Scale, User Experience) (Productivity, Ease of use) ▪ ~94% of monthly policy issuance is ▪ Microservices based platform for ▪ RPA bots enabling 25+ processes in through system integrated channels trans
Slide 63: Glimpse of new Tech & Digital Capabilities across the value chain (1/2)
Glimpse of new Tech & Digital Capabilities across the value chain (1/2) Distribution Build Sales Fulfilment Underwriting SME Tailor UW OCR Commercial End to End Digital Health Rules Health Pre Policy Policy Issuance Assets Onboarding of agents Health Policy Engine (UW & Medical Digitization API Frau
Slide 64: Glimpse of new Tech & Digital Capabilities across the value chain (2/2)
Glimpse of new Tech & Digital Capabilities across the value chain (2/2) Claims Renewals Operations & Servicing Provider Portal NRLMS AI based proctoring Health Claim Workflow RPA for Claims, Assets Renewal Lead Finance, Operations for new hires AI based Motor Claim Adjudication Management & Lead Pro
Slide 65: Indian General Insurance: Large addressable market
Indian General Insurance: - Large addressable market Significantly underpenetrated Premium as a % GDP Non-Life Insurance Density (Premium per capital) (CY21) (US$) (CY21) (US$) 9.10 2520 5.20 1764 1039 855 2.20 2.20 2.20 1.90 1.70 1.00 0.90 0.50 229 154 130 111 22 22 China Indonesia Brazil Japan UK
Slide 66: Industry has Witnessed Strong Growth Over the last 15 Years
Industry has Witnessed Strong Growth Over the last 15 Years General Insurance Gross Premium has grown >10x over the last 15 years (Rs In Cr) Growth of 16.2% CAGR (Last 15 Years) = 15% over YTD Dec FY’22 2,20,772 1,89,3021,98,724 1,87,233 1,70,036 1,50,572 1,28,213 96,394 58,357 69,086 77,541 84,686
Slide 67: Motor & Retail Health are the Largest GI Segment and Continue to Grow at Steady Pace
Motor & Retail Health are the Largest GI Segment and Continue to Grow at Steady Pace Motor accounts for 42.8% share of the overall GWP Motor Claim ratio for Private General Insurers (single largest segment) (Private Motor Insurance– GWP Rs in Crs (Private Motor Insurance– Claims Ratio) CAGR: 14% 83%
Slide 68: Industry Growth – YTD Dec FY’23
Industry Growth – YTD Dec FY’23 Addressable Market Share Preferred lines - Chola MS Industry Ex -Crop Growth INSURER(Rs. in Cr) Growth over GWP Rs in Cr Crop Group Health Govt Health ,Group & Govt over YTD YTD Dec FY'22 Health Dec FY'22 ICICI-Lombard 16048 20.6% 874 2821 0 12353 15.1% HDFC ERGO 1193
Slide 69: Industry Landscape – GWP Growth for Private GI Players (5 Yr CAGR)
Industry Landscape – GWP Growth for Private GI Players (5 Yr CAGR) Growth YTD Dec FY'23 Market Last 5 years Motor Mix Heath + PA Insurers over YTD Crop Mix% Fire Mix% Others GWP (Rs in Crs) Share GWP CAGR % Mix% Dec FY'22 ICICI-Lombard 16048 20.6% 10.1% 17.3% 39.9% 24.7% 5.4% 15.1% 14.9% Bajaj Allia
Slide 70: Favorable Regulations Aiding Growth
Favorable Regulations Aiding Growth Amendment to Acts expected to improve profitability and growth across segments Working well Requiring Tweaks Impending Mandatory Long term Third Party Insurance Crop Insurance Single Limit for Expense of Management 3 years for Cars, 5 years for 2W PMFBY financ
Slide 71: 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@cfhl.murugappa.com 70
Slide 72: 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 73: Thank You
Thank You <> Chola 2% Financial Holdings murugappa
Cholamandalam Financial Holdings — Q3 FY23 Earnings Presentation on 6ix