Poonawalla Fincorp Limited · NSE:POONAWALLA
Poonawalla Fincorp — Q1 FY25 Earnings Presentation
42 slides from Poonawalla Fincorp's earnings presentation, Jul 20, 2024
Slide 1: Exchange filing cover letter
July 20, 2024 BSE Limited National Stock Exchange of India Limited Corporate Relationship Department The Listing Department, 25th Floor, Phiroze Jeejeebhoy Towers, Exchange Plaza, Dalal Street, Fort, Bandra- Kurla Complex, Bandra (East), Mumbai - 400 001. Mumbai - 400 051. BSE Scrip Code: 524000 NSE
Slide 2: Q1FY25 Investor Presentation
Q1FY25 Investor Presentation July 20,2024 Productive | Predictable | Sustainable
Slide 3: Disclaimer
Disclaimer This presentation and the accompanying slides (the "Presentation") have been prepared by Poonawalla Fincorp Ltd. (the "Company") solely for informational purposes. They do not constitute an offer, recommendation, or invitation to purchase or subscribe for any securities. Furthermore, they
Slide 4: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards 3
Slide 5: 1. Key Highlights
POONAWALLA FINCORP FINCORP. INTRODUCING THE SAFEST & FASTEST WAY TO GET FUNDS 1. Key Highlights
Slide 6: Financial Highlights
Financial Highlights Continued growth momentum AUM NII PPoP ▪ Mr. Arvind Kapil joined as new MD and ₹26,972 Cr ₹676 Cr ₹432 Cr CEO on June 10, 2024, to spearhead the 52% YoY 42% YoY 47% YoY organization for the next phase of growth 8% QoQ 5% QoQ 6% QoQ ▪ Consistent AUM growth across the product PBT
Slide 7: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview ✓ Vision and Strategy ✓ Assets ✓ Liability ✓ Risk Management 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards 6
Slide 8: 2. Business Overview
POONAWALLA FINCORP INTRODUCING THE SAFEST & FASTEST WAY TO GET FUNDS 2. Business Overview
Slide 9: Our Vision and Mission
Our Vision and Mission To be the most trusted financial services brand Trust denotes legacy and brand promise Vision Financial services: Holistic term that broadly defines the current and future business expansion To help our customers succeed financially, and our values guide everything we do: Ethi
Slide 10: Way Forward
Way Forward Solidify, Expand and Scale Shaping up a Productive, Predictable and Sustainable Business Scale ▪ Sharper focus on customer FY25 Expand acquisition funnel ▪ Cross-sell to onwards ▪ Expand the new product customer cohorts at Solidify lines lower acquisition ▪ Expand ‘Phygital’ model cost ▪
Slide 11: Optimising product mix
Optimising product mix Incubate and expand with product lines FY25 Planned Launches Consumer Durable PL Prime Shopkeeper Loans Used CVs ▪ Build large customer ▪ Quality of customers ▪ No incremental ▪ Profit maximiser franchise ▪ Foundation for cross- branch infrastructure ▪ Enhancing MSME ▪ Generat
Slide 12: AI-led digital strategy
AI-led digital strategy One-stop shop for customer servicing and value-added services Disbursement through App for PL has already picked-up and web-based loan applications and complete digital onboarding will be replicated for other products as well Account Aggregator Dedicated Customer Digital Onbo
Slide 13: Leveraging data analytics
Leveraging data analytics Holistic application across the functions 1 Prospect Acquisition 2 Pre-Sourcing 3 Sourcing 4 Post Sourcing 5 Collections Storage Risk Scorecards Persona Models Portfolio checks Propensity Models Cleansing Fraud Detection ML based Campaigns Early warning signals Allocation M
Slide 14: Investment in building collection infrastructure
Investment in building collection infrastructure Invest in Customized Collection AI-Powered NLP for Customer Omni-Channel Communication Embedded Digital Payment Stack Interaction Stack Channels ➢ Customized collection stack for real- ➢ AI-powered Natural Language ➢ Omni-channel communication stack ➢
Slide 15: Deepening engagement with all stakeholders
Deepening engagement with all stakeholders Fostering strong relationships across the value chain Employees Channel Partners Customers • Implementation of robust • Increase partner visibility and • Holistic customer engagement engagement framework to foster a reward & recognize them in their plan vib
Slide 16: Human Resources: Planned Innovations and Goals
Human Resources: Planned Innovations and Goals HR Vision To enable both HR and employees to complete HR-related tasks with minimal effort, aiming to achieve “Zero Clicks” experience Impact 1 Employee Support and Query Resolution Plan to implement AI-driven solutions for Near zero resolution time -In
Slide 17: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview ✓ Vision and Strategy ✓ Assets ✓ Liability ✓ Risk Management 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards 16
Slide 18: Well diversified product suite
Well diversified product suite Tailored to target our focused segment • Loan ₹1 lakh to ₹75 lakhs • Interest rate starts at 11% pa • Processing fee: 1% of sanction Pre- amount plus tax Owned Car • Tenure: 12 to 72 months • Loan from ₹1 lakh to ₹50 lakhs Personal • Interest rate starts at 15% pa Loan
Slide 19: Phygital Distribution Model
Phygital Distribution Model An architecture for customer sourcing App Website Social Media Sourcing of customers through direct, Sourcing of customers through other DSAs and call centers Channels for various product offerings Other Physical Digital Channels In-house sourcing of customers through web
Slide 20: Assets Under Management
Assets Under Management Diversified AUM with right secured to unsecured mix ▪ Well-diversified AUM across MSME and consumer with multi-sourcing channel ▪ Right balance of secured to unsecured mix at 49:51 Assets under Management [₹ crore] AUM Mix +52%YoY MSME [Secured+Unsecured] 35% 26,972 Personal
Slide 21: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview ✓ Vision and Strategy ✓ Assets ✓ Liability ✓ Risk Management 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards
Slide 22: Credit Rating
Credit Rating Highest rating - AAA Long-term Ratings* Short-term Ratings** CRISIL Ratings CARE Ratings CRISIL Ratings CARE Ratings Mar-24 AAA/Stable Mar-24 A1+ *Long-term rated instruments includes Bank Facilities, NCD and Subordinated Debt | **Short-term rated instrument includes Commercial Paper 2
Slide 23: Composition of Borrowings
Composition of Borrowings Well diversified liability profile ▪ Total borrowings as on June 30, 2024 at ₹17,121 crore. ▪ 70% of borrowings are on variable rate ▪ Healthy mix of Short-term and Long-term borrowing ensuring positive ALM and optimised cost of borrowing Instrument wise Institution wise 25
Slide 24: Optimizing Cost of Borrowing
Optimizing Cost of Borrowing CoB continues to remain stable despite higher interest rates 9.14% 8.17% 8.16% 8.00% 8.04% 7.98% 7.99% 7.90% 7.54% 7.54% 7.16% 6.97% Repo rate hike → Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 23
Slide 25: ALM statement and Liquidity
ALM statement and Liquidity Structural Liquidity Statement as on June 30, 2024 Liquidity as on June 30, 2024 for PFL stood at ₹ 5,192 crore in the form of cash, cash equivalents and undrawn bank lines Cumulative inflows (₹ crore) Cumulative outflows (₹ crore) 30,946 30,946 27,416 25,339 22,321 19,22
Slide 26: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview ✓ Vision and Strategy ✓ Assets ✓ Liability ✓ Risk Management 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards
Slide 27: Risk Management integrated into the strategy
Risk Management integrated into the strategy Prudent risk management frameworks Risk Management Data driven Risk 360 Degree data Fraud prevention Rule engine-based Focus on risk Learn and evolve Management mobilization and detection approach adjusted return • Time maturity • Segmented strategy • Lev
Slide 28: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards 27
Slide 29: 3. Financial Overview
POONAWALLA FINCORP POONAWALLA, FINCORP. INTRODUCING THE SAFEST & FASTEST WAY TO GET FUNDS 3. Financial Overview
Slide 30: Net Interest Income (NII) and Operating Expense
Net Interest Income (NII) and Operating Expense Consistent growth in net interest income NII (₹ crore) Opex to AUM ratio 4.5% +42% YoY 4.4% 676 4.3% 4.4% 641 4.2% 529 550 4.1% 4.2% 478 4.0% 3.9% 4.0% 4.0% 3.8% 3.9% 3.7% 3.6% Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Cost
Slide 31: Asset Quality Trend
Asset Quality Trend ➢ Substantial rundown in discontinued/ legacy book ➢ Short Term Personal Loan (STPL) is unseasoned book and monitored closely Steady improvement in asset quality Particulars (₹ crore) June-23 Sep-23 Dec-23 Mar-24 June-24 GNPA NNPA Stage 1 Assets 16,421 18,657 19,706 22,204 23,903
Slide 32: Profitability
Profitability Sustained improvement across key metrics PPoP (₹ crore) PBT and PAT (₹ crore) +47% YoY +46% YoY 409 432 385 390 357 332 350 308 292 336 268 265 294 230 200 Q1FY24 Q2FY24 Q3FY24 Q4FY24 Q1FY25 Q1FY24 Q2FY24* Q3FY24 Q4FY24 Q1FY25 RoA 5.73% 4.78% 4.97% 5.31% 4.62% ▪ Continued increase in p
Slide 33: Shareholders' Funds
Shareholders’ Funds Well capitalized to drive the future growth Shareholders’ Funds (₹ crore) Book Value per Share (₹) 8,075 8,116 8,370 105 109 7,781 101 105 6,649 87 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Jun-23 Sep-23 Dec-23 Mar-24 Jun-24 Capital Adequacy ratio (CAR) Debt to Equity ratio 5 4.08 35.60
Slide 34: Profit & Loss Statement
Profit & Loss Statement ₹ crore Q1FY24 Q4FY24 Q1FY25 YoY QoQ Total Interest Income 656 844 896 36.6% 6.2% Interest expenses 235 281 320 36.3% 13.9% Net Interest Income (NII) 421 563 576 36.8% 2.4% Fee & Other Income 56 78 100 76.9% 27.5% NII (inc. fees and other income) 478 641 676 41.5% 5.5% Operat
Slide 35: Balance Sheet
Balance Sheet ₹ crore June 30, 2023 March 31, 2024 June 30, 2024 YoY QoQ Cash & Bank Balances 308 269 400 30% 49% Receivables 21 29 19 -12% -34% Loans 17,031 22,046 24,083 41% 9% Investments 761 878 1,063 40% 21% Other Financial Assets 357 258 229 -36% -11% Non-Financial Assets 1,201 556 534 -56% -4
Slide 36: Table of Contents
Table of Contents 1 Key Highlights 2 Business Overview 3 Financial Overview 4 Board of Directors, Management Team, ESG and Awards 35
Slide 37: 4. Board of Directors, Management Team, ESG and Awards
4. Board of Directors, Management Team, ESG and Awards 36
Slide 38: Board of Directors
Board of Directors Commanding the course with the best governance standards Mr. Abhay Bhutada Mr. Amar Deshpande Mr. Adar Poonawalla Mr. Arvind Kapil Mr. Sunil Samdani Non-Executive Director Non-Executive Director Chairman & Non- Managing Director Executive Director Executive Director & CEO CEO of t
Slide 39: Management Team
Management Team Leading the next phase of growth Mr. Arvind Kapil Mr. Sunil Samdani Mr. Sanjay Miranka Mr. Shriram V. Iyer Mr. Vikas Pandey Managing Director & CEO Executive Director Chief Financial Officer Chief Credit & Analytics Officer Chief Business Officer - Consumer Business Education: AMP, M
Slide 40: ESG delivering sustainable long-term value to stakeholders
ESG delivering sustainable long-term value to stakeholders Prioritising responsible business practices Our Approach Metrics Environment 5575.05 GJ 0.40 tCO2/H Implemented energy saving Total Scope 1 and Scope 2 We are committed to sustaining our environment by Total energy measures emissions intensi
Slide 41: Awards and Accolades
Awards and Accolades Industry Recognition for our brand Human Resource Certified as a great India’s Best Recognised as The workplace by Great Workplace in Most Preferred Place To Work Health & Wellness Workplace (GPTW) from January 2023 2023-24 2024 Brand & Marketing Risk Management The Great Indian
Slide 42: Thank You!
Thank You! For further information, please contact: Team – Investor Relations Investor.relations@poonawallafincorp.com www.poonawallafincorp.com CIN : L51504PN1978PLC209007