CARE Ratings Ltd · NSE:CARERATING
CARE Ratings — Q3 FY2017 Earnings Presentation
21 slides from CARE Ratings's earnings presentation, Feb 3, 2017
Slide 1: Q3-FY17 and 9M-FY17 Financial Results
Q3-FY17 and 9M-FY17 Financial Results Rajesh Mokashi MD & CEO
Slide 2: Safe Harbor Statement
SAFE HARBOR STATEMENT THIS PRESENTATION AND THE ACCOMPANYING SLIDES (THE “PRESENTATION”), WHICH HAVE BEEN PREPARED BY CREDIT ANALYSIS & RESEARCH LIMITED (THE “COMPANY”), HAVE BEEN PREPARED SOLELY FOR INFORMATION PURPOSES AND DO NOT CONSTITUTE ANY OFFER, RECOMMENDATION OR INVITATION TO PURCHASE OR SU
Slide 3: Contents
Contents Highlights Financial & Business Performance MCR / CDQI Economic Backdrop Q3 FY17 & 9M FY17 Results 3rd February, 2017
Slide 4: Highlights: 9M-FY17
Highlights: 9M-FY17 • Growth in Financial Indicators – Growth in operating income of 7.6% in 9M-FY17 over 9M-FY16 – Growth in total income of 16.8% in 9M-FY17 over 9M-FY16 – Decline in expenditure by 7.3% mainly due to ESOP charge only in 9M-FY16 – EBITDA margins at 71.7% and PAT margins at 49.5% in
Slide 5: Highlights: Q3-FY17
Highlights: Q3-FY17 • Growth in Financial Indicators – Growth in operating income of 4.8% in Q3-FY17 over Q3-FY16 – Growth in total income of 28.7% in Q3-FY17 over Q3-FY16 – Decline in expenditure by 4.9% mainly due to ESOP charge only in Q3-FY16 – EBITDA margins at 73.7% and PAT margins at 54.9% in
Slide 6: Contents
Contents Highlights Financial & Business Performance MCR / CDQI Economic Backdrop Q3 FY17 & 9M FY17 Results 3rd February, 2017
Slide 7: Financial Performance
Financial Performance Rs. Crore Q3-FY16 Q3-FY17 Growth 9M-FY16 9M-FY17 Growth Rating Revenue 62.32 65.50 5.1% 188.01 202.70 7.8% Other Operating Revenue 0.62 0.44 -27.9% 1.59 1.40 -12.3% Total Revenue 62.93 65.95 4.8% 189.61 204.10 7.6% Other income 0.99 16.30 1542.6% 6.14 24.48 298.7% Total income
Slide 8: Financial Performance: 9M-FY17
Financial Performance: 9M-FY17 • Operating profit margin increased to 67.1% from 61.8% in 9M-FY16 mainly on account of new business sourced and surveillance income. • There is decline in expenditure mainly on account of ESOP charge which was included in 9M-FY16 of Rs. 3.84 cr and lower rent expense
Slide 9: Financial Performance: Q3-FY17
Financial Performance: Q3-FY17 • Operating profit margin increased to 66.0% from 62.6% in Q3-FY16 mainly on account of new business sourced and surveillance income. • There is decline in expenditure mainly on account of ESOP charge which was included in Q3-FY16 of Rs. 1.27 cr and lower rent expense
Slide 10: Business Performance
Business Performance Total Active Clients 16,000 14,575 14,000 13,159 12,373 12,127 11,838 12,000 10,000 8,000 6,000 4,000 2,000 - Dec'15 Mar'16 June'16 Sept'16 Dec'16 Q3 FY17 & 9M FY17 Results 3rd February, 2017
Slide 11: Business Performance: 9M & Q3-FY17
Business Performance: 9M & Q3-FY17 Volume of Debt Rated (Rs lk cr) No of Instruments Rated 10.00 9.43 7,000 5,986 6,000 8.00 7.37 5,002 5,000 3,9003,834 6.00 4,000 4.62 3.90 3,000 4.00 3.28 3.50 1,844 2,000 833 2.00 1,000 0.59 0.91 68 55 201 253 - - Short & Long term Bank Loan Others Total Short & M
Slide 12: Contents
Contents Highlights Financial & Business Performance MCR / CDQI Economic Backdrop Q3 FY17 & 9M FY17 Results 3rd February, 2017
Slide 13: Rating Movement
Rating Movement Credit Quality of domestic rated firms/entities declined during 9 months FY17 as indicated by the MCR. Although the ratio continues to be above unity, indicating higher number of upgrades than downgrades, there has been a moderation in the ratio this fiscal year to 1.08 compared with
Slide 14: CARE Ratings Debt Quality Index
CARE Ratings Debt Quality Index The CDQI had shown a continuous decline from May’15 (when it was first announced by CARE) to Dec’15. After improving marginally in Jan’16 and Feb’16, the index declined considerably in Mar’16, and further marginally in Apr’16. The index has shown stability, though wit
Slide 15: Contents
Contents Highlights Financial & Business Performance MCR / CDQI Economic Backdrop Q3 FY17 & 9M FY17 Results 3rd February, 2017
Slide 16: Economic Backdrop
Economic Backdrop 10 5.0 CARE expects the GDP growth at around Subdued Industrial Growth 6.7%-6.8% 7.9 8 7.5 7.6 7.6 4.0 3.8 7.2 7.1 7.3 7.1 6 3.0 4 2.0 2 1.0 0.4 0 Q1 Q2 Q3 Q4 FY16 Q1 Q2 FY17 0.0 FY16 FY16 FY16 FY16 FY17 FY17 (AE) FY16 (Apr-Nov) FY17 (Apr-Nov) Source: CSO Source: Mospi Q3 FY17 & 9M
Slide 17: Economic Backdrop
Economic Backdrop 8 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY16 FY16 FY16 FY16 FY17 FY17 FY17 5.7 62.00 6 5.1 5.3 5.3 5.1 3.9 3.8 4 3.8 3.4 63.50 2 64.00 1.4 0 64.91 Q1 Q2 Q3 Q4 Q1 Q2 Q3 FY16 FY16 FY16 FY16 FY17 FY17 FY17 66.00 -2 65.95 -0.8 -2.3 -2.9 -4 66.93 66.96 -4.6 67.46 67.50 -6 68.00 WPI (%) CPI (%) Rs/$ Sour
Slide 18: Economic Backdrop
Economic Backdrop 15 Growth in Credit CP Issuances (Rs lakh cr) 11.9 13.00 10 8.0 12.43 12.50 5 1.9 12.00 0.4 0.4 0 -0.8 0.1 11.50 11.31 Bank Credit Industry Services Retail 11.00 -5 -5.5 10.50 -10 Apr-Nov FY16 Apr-Nov FY17 9M FY16 9M FY17 6,00,000 Corporate Debt Raised (Rs cr) 5,05,939 5,00,000 4,7
Slide 19: Economic Backdrop
Economic Backdrop 12 Repo Rate (%) & MCLR(%) 7.80 G Sec Yield (%) 7.60 7.40 10 7.20 9.05 8.83 7.00 6.80 8 6.60 6.40 6.50 6.25 6.20 6 6.00 Jun-16 Jun-16 Sep-16 Oct-16 Sep-16 Oct-16 Apr-16 Aug-16 Apr-16 Aug-16 Nov-16 Nov-16 May-16 May-16 Jul-16 Jul-16 Dec-16 Dec-16 Repo Rate (%) MCLR (%) G Sec Yield (
Slide 20: Economic Outlook for FY17
Economic Outlook for FY17 • GDP growth has been affected post-demonetization and is expected to be lower at 6.7%-6.8% in FY17 • Inflation expected in the range of 4% • Rupee to be in the range of Rs.69 due to higher foreign capital outflows • Decline in capital formation • RBI to maintain accommodat
Slide 21: Thank You
Thank You Q3 FY17 & 9M FY17 Results 3rd February, 2017