Religare Enterprises Limited · NSE:RELIGARE
Religare Enterprises — Q4 FY2011 Earnings Presentation
40 slides from Religare Enterprises's earnings presentation, May 25, 2011
Slide 1: Religare Enterprises Limited Q4 and FY11 Results
Religare Enterprises Limited Q4 and FY11 Results 25 May 2011
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Religare Enterprises Limited (the “Company”) solely for use at its analyst conference call on May 25, 2011. The material that follows is a presentation of general background information about the Company’s activities as at the date of the presentatio
Slide 3: Table of Contents
Table of Contents Section I : Q4 and FY11 Highlights Section II : Performance of Key Subsidiaries Appendix 1: Performance of Other Subsidiaries and JVs Appendix 2: Subsidiary and JV Balance Sheets 2
Slide 4: Religare is building a leading emerging market financial services group
Religare is building a leading emerging market financial services group, anchored in India and underpinned by three secular trends Robust Indian growth story providing solid breadth and depth to the Integrated Indian 1 financial services sector resulting in rapid growth of Financial Services profit
Slide 5: Strategy Implementation Update – 1/2
Strategy Implementation Update – 1/2 Continue to consolidate our position in India… Softness in the Indian financial markets continued in Q4FY11 as anticipated – early counter-measures helped contain the impact in some businesses • Asset Finance: Loan book grew to `58 bn* – close to the upper end
Slide 6: Strategy Implementation Update – 2/2
Strategy Implementation Update – 2/2 …and grow international platform Traction across geographies in Investment Banking and Equity Capital Markets with marquee deals in India, Singapore, UK and USA India research covers 185 stocks as of 31-Mar-2011, representing more than 75% of the BSE market E
Slide 7: Proposed Rights Issue
Proposed Rights Issue On 26th April, 2011, the Board of Directors have approved issue of equity shares on rights basis to the shareholders of the company for an amount of up to Rs. 8,000 million (with an option to increase the issue size by up to 10%) (“Rights Issue”) Subsequent to the approval
Slide 8: Indian markets were soft in H2FY11 but structural story continues to be strong
Indian markets were soft in H2FY11 but structural story continues to be strong Pressure points remain in Significant upward shift in short term interest the financial markets as Share of retail turnover in Cash equities has steadily anticipated rates has led to increase in cost of funding declined
Slide 9: Key Financial Indicators – Q4FY11 and FY11
Key Financial Indicators – Q4FY11 and FY11 Robust revenue growth – Q4 revenue up 62% QOQ and FY11 Investments in new businesses continued through FY11, reflected revenue up 78% YOY as accounting losses (` mn) REL Consolidated Revenue* (` mn) REL Consol. PBT* REL Consol. PAT* +62% 560 322 159 -247 -2
Slide 10: Consolidated Income Statement
Consolidated Income Statement Y-o-Y Change Q-o-Q Change Y-o-Y Change (` mn) FY 11 FY10 (%) Q4 FY 11 Q3 FY 11 (%) Q4 FY 10 (%) Income from Operations 21,924 14,583 50% 6,516 5,823 12% 4,851 34% Other Operating Income* 4,052 2,169 87% 1,848 761 143% 465 297% Sale of Bullion 3,890 - nm 3,297 593 456% -
Slide 11: Consolidated Balance Sheet
Consolidated Balance Sheet (` mn) As at Mar 31, 2011 As at Dec 31, 2010 As at Mar 31, 2010 Owners’ Funds 29,655 30,737 26,126 Share Capital * 1,764 1,764 1,530 Reserves and Surplus 27,891 28,974 24,596 Loan Funds 113,310 104,418 55,720 Secured Loans 64,950 46,857 15,755 Unsecured Loans 48,361 57,561
Slide 12: Table of Contents
Table of Contents Section I : Q4 and FY11 Highlights Section II : Performance of Key Subsidiaries Appendix 1: Performance of Other Subsidiaries and JVs Appendix 2: Subsidiary and JV Balance Sheets 11
Slide 13: Strong growth in Asset Finance; overall growth muted as other books scaled back
Religare Finvest Strong growth in Asset Finance; overall growth muted as other books scaled back Revenue growth QOQ was muted, reflecting flattish overall loan Controlled growth in loan book – 22% CQGR through FY11 book Lending (` bn) Capital Market Lending Asset Finance Corporate Lending (` mn) Tot
Slide 14: Focus on building secured assets portfolio
Religare Finvest Focus on building secured assets portfolio Asset Finance Book 223% larger than year ago; secured book has grown faster Asset Finance disbursements Lending (` bn) SME Working Capital Loan Against Property (` bn) Amt. Disbursed CE/CV +34% 58.0 Broking Equities 50.7 7.0 39.7 6.4 15.4 1
Slide 15: Portfolio quality in control; scale benefits kicking in
Religare Finvest Portfolio quality in control; scale benefits kicking in Asset Finance portfolio quality continues to remain under control Scale benefits visible as Asset Finance ‘Opex/ANR ratio’** and above benchmark continues to improve Lending (%) 90+ DPD* 30+ DPD* (%) 1.13% 3.29% Opex/ANR 3.18%
Slide 16: Financial Performance – RFL Abridged Income Statement
Religare Finvest Financial Performance RFL Abridged Income Statement Lending QOQ YOY YOY Change Change Change (` mn) FY11 FY10 (%) Q4FY11 Q3FY11 (%) Q4FY10 (%) Broking Equities Income from Operations 11,034 4,723 134% 3,029 3,160 -4% 1,458 108% Other Income 597 638 -6% 430 149 188% 148 192% Broking
Slide 17: Market-wide shift in mix causing pressures
Religare Securities Market-wide shift in mix causing pressures Shift to Options continues: market-wide Options turnover grew 20% QOQ* while Cash and Futures declined Religare’s brokerage yield impacted by change in Cash vs. F&O mix Lending (` bn) Cash Equitites Futures Options (bps) Religare’s Broke
Slide 18: Expansion through franchisees – variable cost model
Religare Securities Expansion through franchisees – variable cost model Expansion of distribution solely through franchisees Steady and sustained growth in client base Lending (Nos.) Own Branches Franchisees (000s) No. of Clients 1,891 1,926 1,962 1,852 1,747 Broking Equities 409 397 396 413 414 761
Slide 19: Financial Performance – RSL Abridged Income Statement
Religare Securities Financial Performance RSL Abridged Income Statement Lending YOY Change QOQ Change YOY Change (` mn) FY11 FY10 Q4FY11 Q3FY11 Q4FY10 Broking Equities (%) (%) (%) Income from Operations 5,669 5,536 2% 1,093 1,540 -29% 1,324 -17% Other Income 594 494 20% 133 130 2% 106 26% Broking Co
Slide 20: Market-share maintained despite increasing competition
Religare Commodities Market-share maintained despite increasing competition Steady growth in market turnover Steady increase in customer base Lending (` bn) (000s) Market’s avg. daily turnover No. of Clients Broking Equities 131 140 117 125 108 427 456 388 326 352 Broking Comm. 31-Mar-10 30-Jun-10 3
Slide 21: Financial Performance – RCL Abridged Income Statement
Religare Commodities Financial Performance RCL Abridged Income Statement Lending YOY Change QOQ Change YOY Change Broking Equities (` mn) FY11 FY10 (%) Q4FY11 Q3FY11 (%) Q4FY10 (%) Income from Operations 907 693 31% 262 220 19% 196 34% Broking Comm. Other Income 3 24 -86% 2 0 316% 6 -67% Total Incom
Slide 22: Continued focus on growing high fee products
Religare AMC Continued focus on growing high fee products Industry-wide average AUM increased 4% QOQ in Q4FY11 – Business update growth largely came from fixed income products Lending (` bn) Avg. Industry AUM Religare Mutual Fund moved up one rank to 13th position in terms of AUM as of 31-Mar-2011
Slide 23: Financial Performance – RAMC Abridged Income Statement
Religare AMC Financial Performance RAMC Abridged Income Statement Lending YOY Change QOQ Change YOY Change Broking Equities (` mn) FY11 FY10 Q4FY11 Q3FY11 Q4FY10 (%) (%) (%) Income from Operations 389 594 -35% 120 84 44% 166 -28% Other Income 3 1 119% 0 2 -70% 0 102% Broking Comm. Total Income 392 5
Slide 24: Traction in Investment Banking and ECM across geographies
Religare Capital Markets Traction in Investment Banking and ECM across geographies Continuing growth in client base: global empanelments now at 580 Business update Lending Institutional Equities No. of Institutional Empanelments • 185 stocks under research coverage in India as of 31-Mar-2011, repres
Slide 25: Financial Performance – RCML India Abridged Income Statement
Religare Capital Markets - India Financial Performance RCML India Abridged Income Statement Lending YOY Change QOQ Change YOY Change Broking Equities (` mn) FY11 FY10 (%) Q4FY11 Q3FY11 (%) Q4FY10 (%) Income from Operations 983 321 206% 122 134 -9% 258 -53% Other Income 37 285 -87% 3 14 -81% 17 -84%
Slide 26: Financial Performance – RCML Overseas Abridged Income Statement
Religare Capital Markets – Overseas Financial Performance RCML Overseas Abridged Income Statement Lending YOY Change QOQ Change YOY Change (` mn) FY11 FY10 Q4FY11 Q3FY11 Q4FY10 Broking Equities (%) (%) (%) Income from Operations 1,623 1,723 -6% 726 467 55% 950 -24% Other Income* 1,521 278 448% 1,399
Slide 27: Financial Performance – RGAM Abridged Income Statement
Religare Global Asset Management Financial Performance RGAM Abridged Income Statement * Business Update Lending Obtained RBI approval during Q4FY11 for acquiring QOQ Change Broking Equities Landmark Partners LLC, USA; (` mn) FY11 Q4FY11 Q3FY11 (%) transaction has since been completed Income from O
Slide 28: Table of Contents
Table of Contents Section I : Q4 and FY11 Highlights Section II : Performance of Key Subsidiaries Appendix 1: Performance of Other Subsidiaries and JVs Appendix 2: Subsidiary and JV Balance Sheets 27
Slide 29: Religare Insurance Broking – Financial Performance
Religare Insurance Broking Financial Performance RIBL Abridged Income Statement QOQ YOY YOY Change Change Change (` mn) FY11 FY10 (%) Q4FY11 Q3FY11 (%) Q4FY10 (%) Income from Operations 165 218 -25% 36 45 -19% 82 -56% Other Income 8 0 nm 7 1 759% 0 nm Total Income 173 218 -21% 43 46 -6% 82 -47% Oper
Slide 30: Religare Macquarie Wealth Management
Religare Macquarie Wealth Management Focus on high fee generating clients and diversification of product suite Client acquisition continues, emphasis on improving wallet-share Consistent growth in AUM – CQGR of 28% over the last one year No. of Clients (` bn) Total AUM CQGR +14% +28% 4,191 20.7 21.5
Slide 31: Religare Macquarie Wealth Management – Financial Performance
Religare Macquarie Wealth Management Financial Performance RMWM Abridged Income Statement* QOQ YOY YOY Change Change Change (` mn) FY11 FY10 (%) Q4FY11 Q3FY11 (%) Q4FY10 (%) Income from Operations 319 298 7% 88 81 9% 110 -20% Other Income 5 2 147% 3 1 400% 1 462% Total Income 324 300 8% 91 81 12% 11
Slide 32: AEGON Religare Life Insurance
AEGON Religare Life Insurance Industry stabilizing post regulatory changes Strong growth in customer base Steady increase Building a balanced in customer distribution basemix (000s) No. of Customers Corporate Agents & Brokers 17% +25% Agency Distribution 36% 151 95 114 63 77 26% Religare Businesses
Slide 33: AEGON Religare Life Insurance – Financial Performance
AEGON Religare Life Insurance Financial Performance ARLI Abridged Income Statement* YOY YOY Change QOQ Change Change (` mn) FY11 FY10 (%) Q4FY11 Q3FY11 (%) Q4FY10 (%) Income from Operations 3,850 1,648 134% 1,857 832 123% 840 121% Other Income 377 188 100% -16 82 nm 38 nm Total Income 4,227 1,836 13
Slide 34: Table of Contents
Table of Contents Section I : Q4 and FY11 Highlights Section II : Performance of Key Subsidiaries Appendix 1: Performance of Other Subsidiaries and JVs Appendix 2: Subsidiary and JV Balance Sheets 33
Slide 35: Subsidiary and JV Balance Sheets (1/5)
Subsidiary and JV Balance Sheets (1/5) RFL Abridged Balance Sheet RSL Abridged Balance Sheet As at March 31, 2011 As at March 31, 2011 (` mn) (` mn) Share Capital 1,733 Share Capital 395 Reserves and Surplus 14,368 Reserves and Surplus 3,879 Loan Funds 90,109 Loan Funds 9,063 Total Liabilities 106,2
Slide 36: Subsidiary and JV Balance Sheets (2/5)
Subsidiary and JV Balance Sheets (2/5) RCL Abridged Balance Sheet RIBL Abridged Balance Sheet As at March 31, 2011 As at March 31, 2011 (` mn) (` mn) Share Capital 20 Share Capital 555 Reserves and Surplus 233 Reserves and Surplus -487 Loan Funds 136 Loan Funds 112 Total Liabilities 389 Total Liabil
Slide 37: Subsidiary and JV Balance Sheets (3/5)
Subsidiary and JV Balance Sheets (3/5) RCML India Abridged Balance Sheet RCML Overseas Abridged Balance Sheet As at March 31, 2011 As at March 31, 2011 (` mn) (` mn) Share Capital 1,478 Share Capital 6,596 Reserves and Surplus 5,446 Reserves and Surplus -3,384 Loan Funds 2,429 Loan Funds 8,289 Total
Slide 38: Subsidiary and JV Balance Sheets (4/5)
Subsidiary and JV Balance Sheets (4/5) RAMC Abridged Balance Sheet RGAM Abridged Balance Sheet As at March 31, 2011 As at March 31, 2011 (` mn) (` mn) Share Capital 0.01 Share Capital 603 Reserves and Surplus 1,024 Reserves and Surplus -344 Loan Funds 3,133 Loan Funds - Minority Interest 3 Total Lia
Slide 39: Subsidiary and JV Balance Sheets (5/5)
Subsidiary and JV Balance Sheets (5/5) RMWM Abridged Balance Sheet* ARLI Abridged Balance Sheet* As at March 31, 2011 As at March 31, 2011 (` mn) (` mn) Share Capital 9,500 Share Capital 1,150 Reserves and Surplus -7,343 Reserves and Surplus 200 Policyholders Funds 4,541 Loan Funds - Funds for Disco
Slide 40: Thank You
Thank You 39 36 Values that bind
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