Indostar Capital Finance Limited · NSE:INDOSTAR
Indostar Capital Finance — Q1 FY19 Earnings Presentation
28 slides from Indostar Capital Finance's earnings presentation, Aug 10, 2018
Slide 1: Q1 FY19 Results Update
INDOSTAR CAPITAL FINANCE LIMITED Q1 FY19 Results Update 10 August 2018
Slide 2: Disclaimer
Disclaimer This presentation and the accompanying slides (the “Presentation”) have been prepared by IndoStar Capital Finance Limited (“IndoStar” or the “Company”) solely for information purposes and do not constitute an offer to sell or, recommendation or solicitation of an offer to subscribe for or
Slide 3: Q1FY19 – Key Takeaways
Q1FY19 – Key Takeaways Strong disbursement growth; ₹ 22,606 Mn, up 3x YoY Corporate Lending ₹ 15,349 Mn, up 3.6x YoY Retail Lending ₹ 7,257 Mn, up 2.1x YoY Vehicle Financing run rate ~ ₹ 1,100 Mn / month Transition to Retail Lending continues 71 CL : 29 Retail, vs 74 : 26 in Q 4, FY 18 Retail Branch
Slide 4: Q1 FY19: Consolidated Key Metrics – as per IGAAP
Q1 FY19: Consolidated Key Metrics – as per IGAAP NIM 5.5% GNPA 1.2% AUM Disbursements Unchanged QoQ 10 bps lower QoQ ₹ 76,402 Mn ₹ 22,606 Mn CoF 9.0% NNPA 1.0 % (+ 23% QoQ; + 54% YoY) (+ 4% QoQ; + 304% YoY) +10 bps QoQ 10 bps lower QoQ Debt / Equity PAT Networth ROAA 2.2%* 1.88 INR 449 Mn INR 28,927
Slide 5: Business Overview
Discussion Summary Business Overview Q1 FY19 Results Update
Slide 6: Experienced Leadership Team
Experienced Leadership Team Several years of experience and in-depth understanding of the specific industry and geographic regions Separate business & credit heads for each vertical Strong alignment through large ESOP program (9.1% of diluted shares) 30+ years of experience in financial 20+ years of
Slide 7: Strong Board of Directors
Strong Board of Directors 14 committees composed of independent and non-independent directors and also employees1 Distinct and delineated responsibilities to ensure good corporate governance Strong capital sponsorship also providing access to best industry practices and international corporate gover
Slide 8: Shareholding Pattern
Shareholding Pattern % Shareholding – June 2018 Major Shareholders Promoter & Promoter Group Management Team and Employees* Foreign Company Trusts SBI Mutual Fund Body Corporates 2.5% 1.4% 6.6% Lenarco (Advent) Others BNP Paribas Arbitrage 8.8% SBI Life Insurance Banks / MF / ICICI Prudential Life I
Slide 9: Promoters Shareholding Structure
Promoters Shareholding Structure Everstone1 51.24 % 100.0% 57.71%4 Indostar Capital3 IndoStar Capital Finance (Promoter) Limited 48.76 % Other Investors2 Strong capital sponsorship of Everstone Group 6 India and SEA US$4.0bn ‘Private Equity Firm of the Year in India’ focused AuM for 6 consecutive ye
Slide 10: Q1 FY19 Results Update
Discussion Summary Business Overview Q1 FY19 Results Update
Slide 11: 3 Pillars of IndoStar
3 Pillars of IndoStar IndoStar, since inception, dynamically balances 3 factors: Growth, Quality and Profitability Growth • Continuous growth since inception • Poised for future growth and expansion in Retail Lending while continuing growth in Corporate Lending Quality • Strong focus on asset qualit
Slide 12: Retail Lending acceleration for Long Term Growth – Q1FY19
Retail Lending acceleration for Long Term Growth – Q1FY19 Corporate Lending and Vehicle Finance will be the Primary Growth Engines Vehicle Finance Housing Finance SME Lending • Focus area: Traders, Manufacturers • Focus area: Used CV (5 – 12 years) • Focus area: Affordable HF, Self- and Services emp
Slide 13: Retail Lending acceleration for Long Term Growth – past 5 Quarters
Retail Lending acceleration for Long Term Growth – past 5 Quarters Disbursements (₹ Mn) AUM (₹ Mn) 7,257 22,346 215% YoY 178% YoY 5,726 16,351 12,229 3,396 9,675 2,993 2,302 8,042 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Q1 FY18 Q2 FY18 Q3 FY18 Q4 FY18 Q1 FY19 Customers Branches Employees 129 8,714 1
Slide 14: Q1 FY19: Growth
Q1 FY19: Growth AUM (₹ Mn) Gross Disbursements (₹ Mn) ₹ 76,402 ₹ 21,830 ₹ 22,606 AUM ₹ 76,402 Mn [+23% vs Q4 FY18; ₹ 62,073 ₹ 49,681 22,346 +54% vs Q1 FY18] 5726 7257 16,352 Retail Lending AUM ₹ 22,346 Mn [+37% 8,041 vs Q4FY18; +178% vs Q1 FY18] 54,056 ₹ 5,594 41,640 45,721 16105 15349 Gross Disburs
Slide 15: Growth … cont.
Q1 FY19: Growth … cont. Customers Branches 129 8,752 91 8,752 Customers [+1.6x vs Q4FY18; 3,428 +13.5x vs. Q1FY18] 605 7 Q1 FY18 Q4 FY18 Q1 FY19 Q1 FY18 Q4 FY18 Q1 FY19 129 Branches [+0.4x vs Q4FY18; +17.4x vs. Q1FY18] Employees 1,431 1,094 1,431 Employees [+0.3x vs Q4FY18; +10.6x vs. Q1FY18] 123 Q1
Slide 16: Q1 FY19: Maintained High Asset Quality
Q1 FY19: Maintained High Asset Quality NPA Analysis (%) Particulars Q1 FY19 Q4 FY18 Q1 FY18 GNPA (₹ Mn) 884 768 838 1.7% 1.3% NNPA (₹ Mn) 740 640 734 1.2% 1.5% Corporate Lending 1.1% 1.0% # Customers 1 1 2 NNPA (₹ Mn) 357 376 558 Q1 FY18 Q4 FY18 Q1 FY19 Retail Lending GNPA % NNPA % # Customers 21 14
Slide 17: Q1 FY19: Profitability
Q1 FY19: Profitability After absorbing full year cost (on pro-rata basis) of scaling up Retail Lending presence, IndoStar still delivered decent profits during Q1FY19 Net Interest Margin [NIM] - 5.5% Return on Average Assets [RoAA] - 2.2% (annualised) Return on Average Equity [RoAE] – 7.2% (8.3% wit
Slide 18: Investments to scale up Retail Lending business
Investments to scale up Retail Lending business To scale up Retail Lending Business to deliver continuous GROWTH without compromising on QUALITY and PROFITABILITY, we have made appropriate investments: Infrastructure: • Added 84 branches in FY 18 + 38 branches in Q1 FY 19; Total Branches 129 • Spent
Slide 19: Consolidated Profit & Loss Statement - IGAAP
Q1 FY19: Consolidated Profit & Loss Statement - IGAAP Particulars (₹ Mn) Q1 FY19 Q1 FY18 YoY % Q4 FY18 QoQ % Interest Income 2,228 1,705 31% 1,924 16% Interest Expense (1,126) (764) 47% (954) 18% Net Interest Income 1,102 942 17% 970 14% Fee Income 314 137 128% 556 (44%) Total Income 1,416 1,079 31%
Slide 20: Consolidated Balance Sheet – IGAAP
Q1 FY19: Consolidated Balance Sheet – IGAAP Particulars (₹ Mn) Q1 FY19 Q1 FY18 YoY % Q4 FY18 QoQ % Equity & Liabilities Equity 28,928 19,668 47% 21,372 35% Borrowings 54,370 33,295 63% 48,228 13% Other Liabilities & Provisions 4,832 1,186 307% 3,364 44% Total Equity & Liabilities 88,129 54,148 63% 7
Slide 21: Diversified Borrowing Profile
Q1 FY19: Diversified Borrowing Profile Borrowing Mix % - March 2016 Borrowing Mix % - March 2017 Borrowing Mix % - March 2018 Borrowing Mix % - June 2018 CPs CPs Others Other 5% NCD s 4% 13% 21% 25% CPs NCD NCD CPs 22% NCD 33% 35% 26% 36% Bank s Banks Banks Banks 52% 46% 44% 38% Strong Credit Rating
Slide 22: IndAS Financial results
IndAS Financial results As permitted under circular no. CIR/CFD/FAC/62/2016 dated July 5, 2016 issued by Securities and Exchange Board of India ("SEBI"), the Company has opted to avail exemption for submission of lndAS compliant financial results for the quarter ended March 31, 2018 and previous yea
Slide 23: Consolidated Profit & Loss Statement – IndAS
Q1 FY19: Consolidated Profit & Loss Statement – IndAS Particulars (₹ Mn) Q1 FY19 Q1 FY18 YoY % Q4 FY18 QoQ % Interest Income 2,287 1,831 25% 2,071 10% Interest Expense (1,119) (766) 46% (968) 16% Net Interest Income 1,167 1,065 10% 1,103 6% Fee Income 57 4 1325% 73 (22%) Total Income 1,224 1,069 15%
Slide 24: Consolidated Balance Sheet – IndAS
Q1 FY19: Consolidated Balance Sheet – IndAS Particulars (₹ Mn) Q1 FY19 Q4 FY18 QoQ % Equity & Liabilities Equity 28,684 21,199 35% Borrowings 54,370 48,228 13% Other Liabilities & Provisions 4,204 2,940 43% Total Equity & Liabilities 87,257 72,366 21% Assets Loans * 74,699 60,559 23% Investments 7,3
Slide 25: One-time transition impact on opening Reserves & Surplus as of 01 April 2017
One-time transition impact on opening Reserves & Surplus as of 01 April 2017 Particulars ₹ Million Remarks Opening Reserves & Surplus balance as per 19,028 previous GAAP Ind AS adjustments increasing / (decreasing) Reserves & Surplus (Pre tax): Adoption of Effective Interest Rate (EIR) for (501) Imp
Slide 26: Reconciliation of consolidated profit with previous GAAP
Reconciliation of consolidated profit with previous GAAP ₹ million Particulars Q1 FY19 Q1 FY18 Q4 FY18 FY18 Remarks Profit after tax as per previous GAAP 449 533 603 2,244 Ind AS adjustments increasing / (decreasing) profit : Adoption of Effective Interest Rate On account of amortisation of upfront
Slide 27: Consolidated Financial Statements – IGAAP vs IndAS
Consolidated Financial Statements – IGAAP vs IndAS Q1 FY19 Q1 FY19 Profit & Loss (₹ Mn) Balance Sheet (₹ Mn) Ind AS IGAAP Ind AS Adj. Ind AS IGAAP Ind AS Adj. Interest Income 2,228 58 2,287 Equity & Liabilities Interest Expense (1,126) 7 (1,119) Equity 28,928 (244) 28,684 Net Interest Income 1,102 6
Slide 28: For Further Queries:
For Further Queries: Pankaj Thapar Nilesh Dalvi CFO IR Consultant Contact No: +91 22 4315 7036 Contact No: + 91 9819289131 Email – pthapar@indostarcapital.com Email – nilesh.dalvi@dickensonir.com Ravindra Bhandari IR Consultant Contact No: 9283614197 Email: ravindra.bhandari@dickensonir.com
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