Bajaj Finserv Limited · NSE:BAJAJFINSV
Bajaj Finserv — Q2 FY19 Earnings Presentation
35 slides from Bajaj Finserv's earnings presentation, Oct 23, 2018
Slide 1: Cover letter to BSE and NSE for Q2 investor presentation
~BA.JA.J \lii1 FINSERV 23 October 2018 To To Corporate Relations Department. Corporate Listing Department. BSE Limited National Stock Exchange of India ltd 1st Floor, New Trading Ring, Exchange Plaza, 5th Floor Rotunda Building, P J Tower, Plot No.C-1, G Block, Dalal Street, Mumbai 400 001 Bandra-Ku
Slide 2: Bajaj Finserv Limited Investor Presentation – Q2 FY19
BAJAJ FINSERV LIMITED Investor Presentation – Q2 FY19* * Financial year 2018-19
Slide 3: Bajaj Finserv – A diversified financial services group
Bajaj Finserv – A diversified financial services group 54.99% 74% 74% Bajaj Finance Limited Bajaj Allianz General Bajaj Allianz Life • Diversified Consumer, Rural, Insurance # Insurance # SME, Commercial & Mortgages lender in India • Among the top 5 private sector • Highest PAT among private players
Slide 4: Bajaj Finserv performance highlights
Bajaj Finserv performance highlights All Figures in Rs Million Performance Highlights of Q2 FY19 over Q2 FY18 (Ind AS) CY 96,984 18,104 7,040 31,501 17% 14% 1% 10% PY 82,664 15,841 6,982 28,583 Total Revenue Profit before Tax PAT Net Worth (Consolidated) (Consolidated) (Consolidated) (Standalone) •
Slide 5: Consolidated profit components
Consolidated profit components All Figures in Rs Million Consolidated profit components for Q2 FY19 (Ind AS) Intercompany adjustments Bajaj Finserv- Standalone (2,914) Others 2,916 Life 7,040 Insurance (58) Bajaj Finserv General - Insurance 764 Consolidated Bajaj Finance 1,254 5,078 Consolidated pro
Slide 6: Adoption of Ind AS Accounting standards
Adoption of Ind AS Accounting standards • Bajaj Finserv has adopted Indian Accounting Standards (Ind AS) with effect from 1st April 2018 • Insurance companies’ stand-alone numbers are as per Indian GAAP as Ind AS is not applicable to them. However, for consolidation purposes, they have provided Ind
Slide 7: Reconciliation of Consolidated profit as per Ind AS with Indian GAAP
Bajaj Finserv : Reconciliation of Consolidated profit as per Ind AS with Indian GAAP All Figures in Rs Million Particulars Q2 FY19 Q2 FY18 H1 FY19 H1 FY18 FY2018 Net Profit after Tax as per IGAAP 7,890 6,523 16,780 13,074 27,414 Ind AS Adjustments : Increase / (decrease) Adoption of Effective Intere
Slide 8: H1 FY19 Highlights
H1 FY19 Highlights All Figures in Rs Million Highlights of Group Companies BAJAJ FINSERV$ H1 FY19 H1 FY18 Growth BAJAJ FINANCE$# H1 FY19 H1 FY18 Growth Total Revenue 184,695 158,020 17% AUM 1,002,168 726,687 38% Net worth (Cons) 215,187 195,193 10% Total Income 82,377 58,999 40% PAT 15,298 12,827 19
Slide 9: Bajaj Finance Limited
BAIA FINSERV Bajaj Finance Limited
Slide 10: Bajaj Finance - Overview
Bajaj Finance - Overview Business Construct Non-bank with strategy & structure of a bank with consistent track record of profitability Focused on mass affluent & above clients with strong cross sell orientation Diversified financial services strategy seeks to optimise risk and profit to delive
Slide 11: Bajaj Finance – Overview: Differentiators
Bajaj Finance – Overview DIFFERENTIATORS Part of the Bajaj Group – one A trusted brand with strong brand equity of the oldest & most respected business houses Focus on mass affluent and Overall franchise of 30.05 Mn. and Cross sell client base above customers of 17.82 Mn. Strong focus on cross s
Slide 12: Bajaj Finance's businesses
Bajaj Finance’s businesses 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 751 locations products & furniture annual sales of around medium and
Slide 13: Bajaj Finance – Q2 highlights
Bajaj Finance – Q2 highlights All Figures in Rs Million Performance Highlights of Q2 FY19 over Q2 FY18 (Ind AS) CY 966,821 42,964 9,235 40% 40% 54% PY 691,435 30,660 5,979 Book Size Total Income Profit After Tax CY 1.0% 5.4% • Borrowing mix is not excessively dependent on banks. (Mix of 34 : 52 : 14
Slide 14: Bajaj Finance has clocked healthy growth in revenues
Bajaj Finance has clocked healthy growth in revenues All Figures in Rs Million Book Size Total Income Q2 FY19 127,719 Increase of 40% 966,821 808,158 691,435 Q2 FY19 Increase of 40% 42,964 30,660 FY18 Q2 FY18 Q2 FY19 FY18 Q2 FY18 Q2 FY19 Net Interest Income 81,503 Q2 FY19 Increase of 42% 27,290 19,2
Slide 15: Portfolio quality continues to be good, operating costs remain under control
Portfolio quality continues to be good, operating costs remain under control with profitability All Figures in Rs Million Loss Provision and Net NPA*% 11,000 10,349 2.0% 10,000 9,000 8,000 7,000 6,000 5,000 2,205 4,000 3,146 3,000 2,000 0.53% 0.53% 1,000 0.38% 0 0.0% FY18 Q2 FY18 Q2 FY19 Loss Provis
Slide 16: Bajaj Allianz General Insurance
Bajaj Allianz General Insurance 15
Slide 17: BAGIC - Key Strategic Differentiators
BAGIC - Key Strategic Differentiators STRATEGY Strategy is to focus on retail product lines, with diversified distribution supported by prudent underwriting and strong cash flow generation, while delivering excellence in customer service. DIFFERENTIATORS Strong selection of Risk & prudent Industry l
Slide 18: Bajaj Allianz General – Q2 highlights
Bajaj Allianz General – Q2 highlights All Figures in Rs Million Performance Highlights of Q2 FY19 over Q2 FY18 CY 27,184 18,851 16,794 1,821 -5% 6% 6% -30% PY 28,569 17,743 15,887 2,596 Gross Written Net Written Premium Net Earned Premium Profit After Tax Premium Ex Crop GWP was Rs. 22,430 Mn in 3
Slide 19: BAGIC has maintained Combined ratio below 100%
BAGIC has maintained Combined ratio, below 100% on a sustained basis Combined Ratios Impact of claims from (Including Motor TP Pool Losses) Kerala floods Rs.629 Mn. 98.1% 96.7% 99.3% 96.8% 97.2% 92.3% 88.8% FY14 FY15 FY16 FY17 FY18 Q2 FY18 Q2 FY19 Excluding impact of Flood Claims in Kerala the CoR f
Slide 20: Strong profit growth resulting in high efficiency of capital
Strong profit growth resulting in high efficiency of capital All Figures in Rs Million PAT CAGR of 23% between FY14 – FY18 PAT 9,212 7,278 5,623 5,642 4,090 2,596 1,821 FY14 FY15 FY16 FY17 FY18 Q2 FY18 Q2 FY19 BAGIC – Net worth Capital infused is Rs.2,768 Mn Accumulated profit* 94% of Net worth as N
Slide 21: BAGIC retains its position among top private insurers in gross premium
BAGIC retains its position among top 2 private insurers in terms of Gross Premium Industry GDPI Trend (Rs. Bn.) Q2 FY19 GDPI growth 16% 1,415 1,199 916 737 729 803 647 597 378 439 343 335 390 297 602 678 233 350 386 425 477 185 150 157 FY13 FY14 FY15 FY16 FY17 FY18 Q2 FY18 Q2 FY19 PSU Private Insure
Slide 22: BAGIC has a well balanced product mix
BAGIC has a well balanced product mix Business Mix 5% Others 9% 9% 10% 9% 8% 7% 0% 8% 6% 18% 19% 20% 17% Agri (Crop Insurance) 16% 16% 40% 9% 14% 6% 6% 13% 14% 5% Prop, Liability, Engg 6% 6% 7% 9% 13% 6% 5% 10% 6% Group Health 6% 5% 59% 55% 56% Health (Retail) 46% 44% 43% 34% Motor (Retail) FY14 FY1
Slide 23: BAGIC's Channel Mix: Bancassurance strengthening
BAGIC’s Channel Mix : Bancassurance strengthening Channel Mix 5% 8% 5% 11% 7% Corporate Agents - Banks 12% 9% 7% 15% 19% 20% 20% Corporate Agents - Others Individual Agents 28% 31% 49% 31% Direct Business 36% 32% 31% Brokers 24% FY17 FY18 Q2 FY18 Q2 FY19 Focus on Bancassurance channel has yielded
Slide 24: Asset Under Management
Asset Under Management AUM(cash and investments) - Rs Billion (as of end of period) Q2 FY19 Increase of 23% 148 149 121 BAGIC 108 continues to grow its AUM 92 strongly 79 70 Investments are largely in fixed income securities FY14 FY15 FY16 FY17 FY18 Q2 FY18 Q2 FY19 23
Slide 25: Bajaj Allianz Life Insurance
Bajaj Allianz Life Insurance 24
Slide 26: BALIC – Key Strategic Differentiators
BALIC – KEY STRATEGIC DIFFERENTIATORS STRATEGY • Balance growth with balanced product mix, seeking steady increase in market share. • Business construct is to balance customer value with shareholder returns, focusing on New Business Value DIFFERENTIATORS • Focused on retail segments – mass, and mass
Slide 27: Bajaj Allianz Life – Q2 highlights
Bajaj Allianz Life – Q2 highlights All Figures in Rs. Million Performance Highlights of Q2 FY19 over Q2 FY18 CY 3,459 8,521 8,693 20,825 24% -13% 17% 3% PY 2,800 9,759 7,445 20,156 Individual Rated NB Group NB Renewal Premium Gross Written Premium CY 1,315 539,223 749% Solvency Ratio as on -29% 30 S
Slide 28: Productivity has improved strongly
Productivity has improved strongly All Figures in Rs. Regular Premium Ticket Size Regular Premium Ticket Size (Agency) 65,728 54,636 62,858 Q2 FY19 Q2 FY19 Increase of 19% increase of 37% 55,059 45,449 50,165 39,896 37,066 FY17 FY18 Q2 FY18 Q2 FY19 FY17 FY18 Q2 FY18 Q2 FY19 Focus on balancing variou
Slide 29: Efforts to improve Persistency paying off
Efforts to improve Persistency paying off Persistency 13th Month Persistency 25th Month 77% 78% 64% 68% 73% 58% 63% 51% 51% 53% Persistency - 13th Month Persistency - 25th Month FY16 FY17 FY18 H1 FY18 H1 FY19 FY16 FY17 FY18 H1 FY18 H1 FY19 Persistency 37th Month 49% 49% 45% 44% 42% Persistency - 37t
Slide 30: BALIC's Individual Rated premiums
BALIC’s Individual Rated premiums All Figures in Rs Million Individual Rated NB Agency Individual Rated NB FY18 Increase FY18 Increase 11,065 13,972 of 31% of 38% 8,476 10,101 Q2 FY19 Increase Q2 FY19 of 24% increase of 10% 2,800 3,459 2,218 2,438 FY17 FY18 Q2 FY18 Q2 FY19 FY17 FY18 Q2 FY18 Q2 FY19
Slide 31: Diversified product mix
Diversified product mix Individual Rated Mix (Annual) Individual Rated Mix (Quarterly & Half Yearly) 7% 5% 4% 5% 4% 4% 4% 25% 24% 23% 21% 35% 35% 42% 70% 72% 72% 75% 51% 61% 61% FY16 FY17 FY18 Q2 FY18 Q2 FY19 H1 FY18 H1 FY19 Individual - Unit Linked Individual - Par Individual - Non Par Individual -
Slide 32: Assets Under Management
Assets Under Management AUM (Rs. Bn.) • AUM growth of 6% for Q2 FY19 539 vs Q2 FY18 520 511 493 441 • H1 FY19 AUM grew by 4% vs 436 388 FY18 FY14 FY15 FY16 FY17 FY18 Q2 FY18 Q2 FY19 AUM (Mix) • Of the UL Funds of Rs.218 Bn., 321 59% is equity funds as on 30 306 299 279 Sep 2018 (64% as on 30 Sep 249
Slide 33: BALIC is amongst the most capital efficient private insurers
BALIC is amongst the most capital efficient private insurers All Figures in Rs Million Networth 92,182 93,801 88,601 84,756 76,315 67,490 58,708 FY14 FY15 FY16 FY17 FY18 Q2 FY18 Q2 FY19 • BALIC’s accumulated profits are 87% of the Net worth as at 30 Sep 2018 • No Capital infused after FY08 *Accumula
Slide 34: Disclaimer
Disclaimer This presentation has been prepared by Bajaj Finserv Limited (the “Company”) 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 s
Slide 35: Thank You
BAJAJ FINSERV Thank You 34