Iifl Finance Limited · NSE:IIFL
Iifl Finance — Q3 FY2022 Earnings Presentation
51 slides from Iifl Finance's earnings presentation, Jan 27, 2022
Slide 1: IIFL Finance exchange filing cover letter
IIFL FINANCE January 27, 2022 The Manager, The Manager, Listing Department, Listing Department, BSE Limited, The National Stock Exchange of India Ltd., Phiroze Jeejeebhoy Tower, Exchange Plaza, 5 Floor, Plot C/1, G Block, Dalai Street, Bandra - Kurla Complex, Bandra (E), Mumbai 400 001. Mumbai 400 0
Slide 2: IIFL Finance Q3 profits at ₹310 crores, up 15% y-o-y
IIFL Finance Limited Press Release For immediate publication Mumbai, India 27th January 2022 IIFL Finance Quarterly Results update IIFL Finance Q3 profits at ₹310 crores, up 15% y-o-y and 9M profit ₹867 crores, up 69% y-o-y, Highlights of performance Profit growth momentum- 9MFY22 up 69% y-o-y; Q3FY
Slide 3: Consolidated Results Quarterly – Q3FY22
IIFL Finance Limited Consolidated Results Quarterly – Q3FY22 Quarter ended Quarter ended Quarter ended Rs Crore December 31, December 31, Y-O-Y September 30, Q-O-Q 2021 2020 2021 Total Income (Net) 1,070.8 919.3 16% 969.3 10% Pre-provision 650.2 615.4 6% 581.7 12% operating profit Profit before tax
Slide 4: Gold loans, microfinance, business loans and liquidity position
Gold Loans: As of December 31, 2021 the gold loans AUM grew to Rs. 14,606 Cr, showing a strong growth of 20% y-o-y and 7% q-o-q. Gold loans are provided through our widespread presence in 1170+ cities across 25 states to salaried, self-employed and MSME customer segments. Microfinance: The microfina
Slide 5: Awards and Accolades
Awards and Accolades: IIFL Finance received “The Most Preferred Brand Award 2021 for Sustained Brilliance in Brand Building” at Marksmen Daily Awards. IIFL Finance received The Economic Times Iconic Brand Award 2021 IIFL Foundation was recognized as ‘Champion of Change’ by ET Now for bringing
Slide 6: About IIFL
About IIFL IIFL Group is one of the leading players in the Indian financial services space. Prior to the Composite Scheme of Arrangement (effective May 2019), IIFL Finance Limited (Erstwhile “IIFL Holdings Limited”) (Bloomberg Code: IIFL IN, NSE: IIFL, BSE: IIFL) was engaged in the business of finan
Slide 7: Performance review Q3FY22
IIFL FINANCE Performance review Quarter ended December 31, 2021 (Q3FY22) Bloomberg: IIFL IN IIFL Finance Limited January 27, 2022
Slide 8: Agenda
I IFL FINANCE I. 9MFY22 & Q3FY22 Consolidated performance overview i. Strategy & key highlights ii. Financial performance iii. Asset quality iv. Liquidity position II. Business segments review Ill. Digital transformation initiatives IV. Corporate and others 2
Slide 9: Key highlights of quarterly results (9M and Q3FY22)
Key highlights of quarterly results (9M and Q3FY22) €211FL FINANCE Profit growth momentum- 9MFY22 up 69% y-o-y; Q3FY22 up 15% y-o-y . Net profit grew 69% y-o-y in 9MFY22 (9 months) to 867 Cr. The quarterly net profit was Loan AUM: 246,780 Cr 310 Cr, up 15% y-o-y and 6% q-o-q ROE?: 20.7% Liquidity co
Slide 10: 92% of loan assets are small ticket retail
Our 92% of loan assets are small ticket retail, backed by mortgages, gold or cash-flow to customers under-served by banks a Home Loan Loan AUM %16,495 (35%) Financing affordable homes in small towns and metro suburbs, to self employed/ informal sector employees; Avg loan value ~% 17 lakhs ~~ AF Gold
Slide 11: Our 'right to win' in retail lending
Our 'right to win' in retail lending is built on distribution, IIFL FINANCE digital technology, strong brand and balance sheet .. etail ending Diversifiedbut focused on strong collateral or cash flow backedloans, in segments with robust growth potential. Distribution Strength Technology Edge Bank Pa
Slide 12: Our loans are predominantly retail and granular
Our loans are predominantly retail and granular €21FL FINANCE Loan AUM (Cr): Diversified portfolio mitigates risk of asset concentration and cyclical gyration 15% Capital Markets 9% Microfinance 21% Business Loan Q3FY22 Home Loans 35% 16,495 23% 5% 10.1% 16.8 Gold Loans 31% 14,606 20% 7% 17.4% 0.7 B
Slide 13: Quarterly Profits (Consolidated) up 15% yoy
Quarterly Profits (Consolidated) up 15% yoy, driven by IIFL FINANCE income growth of 16% Z Cr Q3FY22 Q3FY21 Y-o-Y Q2FY22 Q-o-Q Interest income 1,412.0 1,184.5 19% 1,342.3 5% Interest expense (772.8) (611.3) 26% (744.1) 4% Net interest income 639.2 573.2 12% 598.2 7% Income from assigned assets 310.2
Slide 14: 9M FY22 Profits (Consolidated) up 69% yoy
9M FY22 Profits (Consolidated) up 69% yoy, driven by income €211FL FINANCE growth of 20% =Cr QMFY22 QMFY21 Y-0-Y FY21 Interest income 3,999.3 3,454.8 16% 4,719.2 Interest expense (2,217.8) (1,927.7) 15% (2,608.3) Net interest income 1,781.5 1,527.1 17% 2,110.9 Income from assigned assets 816.6 612.0
Slide 15: Quarterly income analysis - Non fund income at 38%
Quarterly income analysis- Non fund income at 38%, more than 90% of operating costs =Cr Loan book using risk capital Securitized book Loan Book (Ind AS Balance sheet) Assigned assets Assets under management =Cr Interest income Interest expense Nil at Ind AS balance sheet loan book (A) Income from as
Slide 16: Consolidated Balance sheet
lIIFL Finance - Consolidated Balance sheet Unaudited as at December 31, 2021 (NBFC, HFC and MFI) ASSETS zcr €23 FL FINANCE LIABILITIES AND EQUITY ZCr (a) (b) (c) (d) (e) Cash and Bank Balances 5,735 Receivables 223 Loan Assets 33,397 Investments 1,083 Other financial assets 852 Total Financial Asset
Slide 17: Key Ratios
IIFL Finance - Key Ratios IIFL FINANCE Particulars Q3FY22 Q3FY21 Q2FY22 9MFY22 9MFY21 NIM on Balance Sheet Assets 7.3% 7.4% 7.0% 6.9% 6.9% NIM on Assigned Assets 6.3% 6.0% 6.6% 6.6% 6.4% Cost-to-income 39.3% 33.1% 40.0% 39.1% 36.4% Core PPOP/ Average AUM 5.2% 5.3% 5.0% 4.9% 4.7% Provisions/ Core PPO
Slide 18: Consistent financial performance and growth over the years
Consistent financial performance and growth over the years ©SIIFL FINANCE Loan AUM (@ Cr) Profit after tax (PAT) (% Cr) Nine monthly 867 Annual 712 761 v a 423 465 503 2 a g 5 8 FY17 FY18 FY19 FY20 FY21 QMFY22 FY17 FY18 FY19 FY20 FY21 OMFY22 Net interest margin (%) Non fund based income (® Cr) 35% 3
Slide 19: Robust and improving financial position
Robust and improving financial position I IFL FINANCE Return on assets (%) Nine monthly Return on equity (%) Nine monthly I Annualized Annualized Annual 2.8% A.. 2.2% 20.3% 2.0% 2.0% 17.9% 1.6% 15.2% 15.3% 13.3% 11.3% . I FY17 FY18 FY19 FY20 FY21 9MFY22 FY17 FY18 FY19 FY20 FY21 9MFY22 Annualized ROA
Slide 20: 6,462 5,682 1,780 4,909 5,025 5,115 1,596 1,591 3,718 1,318 863 987 970 1,858
6,462 5,682 1,780 4,909 5,025 5,115 1,596 1,591 3,718 1,318 863 987 970 1,858 1,628 663 1,272 515 503 526 1,073 358 563 236
Slide 21: Superior asset quality maintained through cycles
Superior asset quality maintained through cycles ©SIIFL FINANCE Gross NPA (%) Net NPA (%) 2.34% 2.79% 1 1.08% 1.76% 1.62% 1.74% 204% += 1.98% 0.82% 0.89% ° a 0.52% 0.58% 9.49% a FY17.-FYI8.—s FY19.—s FY2O0.— FY21_—s Q2FY22._ Q3FY22.=«*FY17)— FY18—FYI9.— FY20_-— FY21_— Q2FY22 Q3FY22 Collection Effici
Slide 22: Asset quality across core segments
Asset quality across core segments amongst best in the IIFL FINANCE industry CORE GROWTH NON-CORE ti SEGMENTS SEGMENTS Home loans Gold loans Construction & Real Estate GNPA GNPA GNPA 1.8% 1.8% 1.0% 0.9% 1.5% 4.4% 1.4% 3.8% 3.7% 0.7% 0.7% 0.8% I I L 0.4% 0.3% 0.3% 0.6%1 2.4% 1.6% 1 1.1°/4 0.2% 0.7% ■
Slide 23: Conservative provisioning across all segments
Conservative provisioning across all segments €211FL FINANCE As at December 31, 2021 (NBFC, HFC and MFI) &Cr Stagel Stage2 Stage3 Stagel Stage2 Stage3 Provision Business loan book Total A 0-30 dpd 31-90dpd 90+ dpd Provision % Re AS per ECL Home Loans 10,324.3 425.6 194.1 10,944.0 1.4% 7.2% 39.0% 114
Slide 24: Restructuring & ECL Provision Movement
Restructuring & ECL Provision Movement €311FL FINANCE As at December 31, 2021 (NBFC, HFC and MFI) Cr Restructuring Loan Loss Provisions Opening mq Closing Business Q3 FY22 oskyo2 Provision Net ‘ Net io Provision (A) (A+B+C) Home Loans 101.8 162.4 242.2 26.1 14.0 254.2 Business Loans 57.5 256.0 410.4
Slide 25: Mar 16 Mar 17 Mar 18
₹ ₹ Mar 16 Mar 17 Mar 18 Mar 19 Mar 20 Mar 21 Dec 21
Slide 26: Structural Liquidity - Surplus across all buckets
Structural Liquidity- Surplus across all buckets IIFL FINANCE r Cr Surplus/ (Deficit) as a % of outflow (cumulative) 101% 76% OD or 45,203 8,873 98 33,938 22,754 0.6,277 • 11,703 ▪ artAas 9,836 7,396 5,116 9,425 3,228 4,885 U to 14 days 1 month 2 months 3 months ' 6 months 1 year 3 years 5 years All
Slide 27: Debt repayment obligation schedule, well covered
Debt repayment obligation schedule, well covered ©S1IFL FINANCE % Cr 10,756 Cash + undrawn lines = 9,145 Cr 9,485 Cash & Cash equivalents as on 6,232 9,046 December 31, 2021 , Earmarked cash & cash equivalents (2,248) 8,355 Free cash & cash equivalents 3,984 Liquid investments / Unutilised CC (+) 1,
Slide 28: Debt resource raising trend
Debt resource raising trend Term Loan = Bonds 3,987 3,889 ws 900 1,402 3,062 2,981 425 Q2FY21 Q3FY21 Q4FY21 €23 FL FINANCE Refinance & Cr 4,299 3,717 2,799 rs ae QUFY22 Q2FY22 Q3FY22 CRISIL long term rating at AA (Stable) CRISIL maintains rating at AA (Stable) for IIFL Finance Ltd as well as IIFL Ho
Slide 29: Business segments review
IIFL FINANCE I. 9MFY22 & Q3FY22 Consolidated performance overview II. Business segments review ■ i. Home loans ii. Business Loans iii. Gold Loans iv. Microfinance v. Construction & Real Estate and Capital Markets Ill. Digital transformation initiative IV. Corporate and others 23
Slide 30: Home loans — product overview
Home loans — product overview vy Primary focus on affordable and non-metro customers. 86% of outstanding home loans were to customers under PSL category. v Target segment is salaried and self -employed profile with focus is on first time home buyers. v Business strategy aligned with government missi
Slide 31: Home loans - financial overview
Home loans - financial overview €23 FL FINANCE . j i oy Asset Under Management (& in Cr) Portfolio Yield (%) = Salaried Self Employed | : 5,300 8,579 12,197 12,443 14,439 | ‘16,495 10.3% 10.3% | 10.1% ' 10.1% ' 9.8% ' : 9.6% ' 59% 52% 9 H 40% Grks 39% | 38% ' FY17 FY18 FY19 FY20 FY21 : Q3FY22 FY17 F
Slide 32: Business loans — product overview
Business loans — product overview v For business loans backed by cash flows v Focus on balancing prudent credit underwriting with instant in-principle decision and automated disbursements based on analytical scorecards v Partnerships with leading fintech lenders focusing on both business and persona
Slide 33: Business loans — financial overview
Business loans — financial overview €23 FL FINANCE . i i 9 Asset Under Management (& in Cr) Portfolio Yield (%) 8,117 i i 7,361 7,805 7,464: ‘ 6 ' | 7,014 16.1% t 000 ' 15.6% 15.6% | 15.6% ' 14.9% ' ! 14.0% ' FY17 FY18 FY19 FY20 FY21 : Q3FY22 FY17 FY18 FY19 FY20 FY21 ‘ Q3FY22 Onboarding Average Tick
Slide 34: Gold loans - product and financial overview
Gold loans - product and financial overview Distribution of AUM as at December 31, 2021 (% Cr) vy Branches in more than 1,170 towns/ cities v_Loan against gold ornaments for personal & business use with on-boarding LTV ~73% vy In-house loan origination tablet application equipped to screen customers
Slide 35: Gold loans - financial overview
Gold loans - financial overview €23 FL FINANCE . i i 9 Asset Under Management (& in Cr) Portfolio Yield (%) ! 14,606 ' 13,149 18.8% i ' “ 17.8% 18.1% 19.0% 18.0% | 47.4% 9,125 H Hl : 6,195 H ' 4,037 i Hl 2,910 : Hl FY17 FY18 FY19 FY20 FY21 : Q3FY22 FY17 FY18 FY19 FY20 FY21 ‘ Q3FY22 . . . . , Onboard
Slide 36: Microfinance — product overview
Microfinance — product overview v¥ Small-ticket loans for purpose of income generation activities v Target segment is rural and semi-urban self- employed women in joint liability groups vy Strong emphasis on training and awareness of all customers detailing end use of funds, timely repayment and emp
Slide 37: Microfinance loans — financial overview
Microfinance loans — financial overview €23 FL FINANCE . i i 9 Asset Under Management (& in Cr) Portfolio Yield (%) ' 5,178 ' 4,738 | 25.4% ' ' 24.8% ' 3,400 H Hl ' 23.4% ' 2,286 : 22.6% ' : 22.3% | 22.0% 840 H ' 238 i Hl L| FY17 FY18 FY19 FY20 FY21 : Q3FY22 FY17 FY18 FY19 FY20 FY21 ‘ Q3FY22 . . : .
Slide 38: CRE & Capital Market
CRE & Capital Market Strategy for non-core synergistic businesses Construction and Real Estate (CRE) The erstwhile CRE business of IIFL Finance, high risk high reward funding of early stage CRE projects against collaterals of land and LOl(Letter of Intent) in case of SRA (Slum Rehabilitation Authori
Slide 39: Digital transformation initiative
I IFL FINANCE I. 9MFY22 & Q3FY22 Consolidated performance overview II. Business segments review Ill. Digital transformation initiative IV. Corporate and others 33
Slide 40: Gold loan home delivered traction picking up
Gold loan home delivered traction picking up.. €311FL FINANCE Loan Journey 2. + Gold loan at customer’s doorstep initiative targets branchless expansion of Gold Loan > business. a Customer applies Executive visits * The initiative started a year ago, saw . fomnita - a veer ad for Gold Loan via H cus
Slide 41: Our Digital DIY channels
Our Digital DIY channels.. €311FL FINANCE Instant Loan My Money Digital DIY Disbursements (% Cr) My Money app and website: a. 100% online loan application process. b. Loans ranging from % 50,000 to %10 113.6 lakhs for Business Loans and from & 5,000 to %2 lakhs for Personal Loans WhatsApp loans: a.
Slide 42: Corporate and others
I IFL FINANCE I. 9MFY22 & Q3FY22 Consolidated performance overview II. Business segments review Ill. Digital transformation initiative IV. Corporate and others
Slide 43: Distinguished Board of Directors
Distinguished Board of Directors IIFL FINANCE IIFL Finance - Board of Directors Nirmal Jain R Venkataraman Chandran Ratnaswami Chairman & Whole-time Managing Director Non-Executive Director Director MBA, IIM Bangalore; MBA, University of Toronto MBA, IIM Ahmedabad; B-Tech, lIT Kharagpur BE, IIT Madr
Slide 44: Experienced senior management team
Experienced senior management team IIFL FINANCE IIFL Finance IIFL Home Finance IIFL Samasta N Venkatesh Rajesh Rajak Monu Ratra Chief Executive Officer Chief Financial Officer Chief Executive Officer Strategic leadership CharteredAccountant 'A Qualified architect and MBA Program in microfinance at H
Slide 45: Recent partnerships with banks for co-lending
Our recent partnerships with banks for co-lending, IIFL FINANCE co-origination and business correspondence.. oaf Union Bank SHIVALIK Standard eris DBS % Andhra c*/ of !ado Am Shivalik Small Finance Bank QCSBBank Chartered tiorni z Gold Loan Gold Loan Business Loan Home Loan Gold Loan aircb- etat DCB
Slide 46: ESG: Supporting a sustainable economy through focus on environment
ESG: Supporting a sustainable economy through focus on IIFL FINANCE environment.. Adopt! vim on I IP • IP • • IP II itiatives as well Consistently reducing our energy Reduced the paper consumption by 3.9 consumption by using energy efficient tons in FY21 by digitalizing and lighting at our branches.
Slide 47: ESG: Promoting financial inclusion
ESG: Promoting financial inclusion As at December 31, 2021 €23 FL FINANCE IIFL is firmly committed to support economic activity and financial inclusion through its loan offerings while adapting to changes in the external environment 50,000 value = 63% of loans given to small businesses = 82% of the
Slide 48: ESG: CSR projects continue amid covid
ESG: CSR projects continue amid covid with creative use of €211FL FINANCE technology Seva Kutirs (Madhya Pradesh) Because of COVID-19 pandemic government schools remained shut which led to interruption in Mid-Day Meal programme. IIFL Foundation supported provision for nutritional and healthy meals,
Slide 49: ESG: Governance — conducting our business with integrity
ESG: Governance —- conducting our business with integrity Establishing vision, mission and values and determining, reviewing the goals and policies of the Company from time to time Promote sound corporate governance practices, ethical standards, and compliance with the laws of the land. Disclose our
Slide 50: IIFL's brand and credibility recognized at various forums
IIFL's brand and credibility recognized at various forums IIFL FINANCE IIFL Finance received 'The Most Preferred Brand' Award 2021 for IIFL Finance received 'The Economic Sustained Brilliance in Brand Building Times Iconic Brand Award 2021' IIFL at Marksmen Daily Awards Foundation was WERE HONOURED
Slide 51: Thank you
Thank you Published in January 2022 IIFL Finance Ltd. All rights reserved. Regd. Off: IIFL House, Sun Infotech Park, Road No. 16V, Plot No.B-23, Thane Industrial Area, Wagle Estate, Thane – 400604. This report is for information purposes only and does not construe to be any investment, legal or taxa