Bajaj Finance Limited · NSE:BAJFINANCE
Bajaj Finance — Q2 FY25 Earnings Presentation
61 slides from Bajaj Finance's earnings presentation, Oct 22, 2024
Slide 1: Exchange filing cover letter for investor presentation
22 October 2024 THE MANAGER, THE MANAGER, BSE LIMITED LISTING DEPARTMENT DCS - CRD NATIONAL STOCK EXCHANGE OF INDIA PHIROZE JEEJEEBHOY TOWERS LTD. EXCHANGE PLAZA, C-1. BLOCK G, DALAL STREET, BANDRA - KURLA COMPLEX, BANDRA MUMBAI - 400 001 (EAST) MUMBAI - 400 051 SCRIP CODE: 500034 SCRIP CODE: BAJFIN
Slide 2: Q2 FY25 Investor Presentation
Q2 FY25 Investor Presentation 22 October 2024
Slide 3: Presentation Path
Presentation Path Section 01 Section 02 Section 03 Section 04 Executive summary – Q2 FY25 Executive Bajaj Finance Limited Financial Asset liability summary – Q2 overview performance – Q2 management FY25 3 16 FY25 30 35 Section 05 Section 06 Section 07 Customer franchise Business segment Update on an
Slide 4: Section 01: Executive summary – Q2 FY25
1.1 Quarter gone by Section 01 Executive summary – Q2 1.2 Lead financial indicators FY25 1.3 Omnipresence strategy update 3
Slide 5: Q2 FY25 Executive summary - Consolidated
Q2 FY25 Executive summary - Consolidated Mixed quarter. Good quarter on volumes, AUM & operating efficiencies. Loan losses remained elevated in Q2. As a result, profit growth and ROA were muted. Delivered AUM growth of ₹ 19,732 crore, booked 9.69 MM new loans and added 3.98 MM new customers in Q2. B
Slide 6: Lead financial indicators (1/7)
Lead financial indicators (1/7) Balance sheet and business metrics 1. AUM was up 29% at ₹ 3,73,924 crore as against ₹ 2,90,264 crore as of 30 September 2023. New lines of businesses have started contributing 2%-3% of AUM growth. AUM composition on YoY basis remained stable. 2. Delivered AUM growth o
Slide 7: Lead financial indicators (2/7)
Lead financial indicators (2/7) Operating efficiencies 10. Net interest income grew by 23% to ₹ 8,838 crore as against ₹ 7,196 crore in Q2 FY24. NIM has stabilised in Q2 FY25. 11. Net total income grew by 24% to ₹ 10,946 crore as against ₹ 8,847 crore in Q2 FY24. 12. Opex to Net total income improve
Slide 8: Lead financial indicators (3/7)
Lead financial indicators (3/7) 19. GNPA & NNPA stood at 1.06% & 0.46%, respectively, as of 30 September 2024 as against 0.91% & 0.31% as of 30 September 2023, amongst the lowest in the industry. 20. The Company’s leverage analysis basis June’24 bureau data suggests that customers having 3 or more l
Slide 9: Lead financial indicators (4/7)
Lead financial indicators (4/7) Additional updates 27. In June 2022, BFL started non-Bajaj Auto (BAL) two-wheelers (2W) financing business. In September 2022, BAL decided to setup its own captive financing unit namely, Bajaj Auto Credit Limited (BACL). BACL started its operations in Q4 FY24. 28. In
Slide 10: Lead financial indicators (5/7)
Lead financial indicators (5/7) Bajaj Housing Finance Limited (BHFL) 31. BHFL successfully concluded its Initial Public Offer (IPO) of ₹ 6,560 crore. This included issuance of new equity shares amounting to ₹ 3,560 crore and an offer for sale by BFL amounting to ₹ 3,000 crore. BHFL equity shares wer
Slide 11: Lead financial indicators (6/7)
Lead financial indicators (6/7) BHFL - Operating efficiencies 41. In Q2, Net interest income grew by 13% to ₹ 713 crore as against ₹ 632 crore in Q2 FY24. 42. In Q2, Net total income grew by 18% to ₹ 897 crore as against ₹ 761 crore in Q2 FY24. 43. In Q2, Opex to Net total income improved to 20.5% a
Slide 12: Lead financial indicators (7/7)
Lead financial indicators (7/7) Bajaj Financial Securities Limited (BFinsec) 53. Margin Trading Facility AUM was up 164% at ₹ 5,430 crore as against ₹ 2,056 crore as of 30 September 2023. 54. Added 77K customers to its franchise in Q2. Retail and HNI customer franchise stood at 833K as of 30 Septemb
Slide 13: Omnipresence strategy update
Omnipresence strategy update 12
Slide 14: Omnipresence metrics - Strong growth momentum across Geography and Digital metrics
Omnipresence metrics - Strong growth momentum across Geography and Digital metrics Particulars Unit Q2 FY24 Q1 FY25 Q2 FY25 YoY Geography New locations added # 106 57 43 NA Locations - Cumulative # 3,934 4,202 4,245 8% Standalone Gold loan branches – Cumulative # 514 692 757 47% App + Web Metrics Ap
Slide 15: Omnipresence metrics - Strong growth momentum across Geography and Digital metrics
Omnipresence metrics - Strong growth momentum across Geography and Digital metrics Particulars Unit Q2 FY24 Q1 FY25 Q2 FY25 YoY App + Web business metrics EMI cards acquired * # in ‘000 199 134 275 38% Personal loan disbursed In ₹ Cr 4,657 5,100 5,248 13% Credit card acquisition # in ‘000 105.6 39.0
Slide 16: Customer franchise - Key financial metrics
Customer franchise - Key financial metrics H1 H1 Particulars @ Unit FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 YoY FY24 FY25 New loans booked In MM 10.1 15.3 23.5 27.4 16.9 24.7 29.6 36.2 18.5 20.7 12% New customer addition In MM 4.1 6.1 8.3 8.1 6.0 9.0 11.6 14.5 7.4 8.5 14% Existing customer mix % 59.
Slide 17: Section 02: Bajaj Finance Limited overview
2.1 Bajaj group structure 2.2 What do we stand for 2.3 Key strategic differentiators Section 02 2.4 Our shareholder profile Bajaj Finance Limited 2.5 BFL Consolidated 17-years financial overview snapshot 2.6 BHFL 7-years financial snapshot 2.7 Product suite 2.8 Executive summary 16
Slide 18: Bajaj group structure
Bajaj group structure Bajaj Holdings & Investment Ltd (BHIL) (Listed) 1 2 3 1 51% 39.03% 34.21% Bajaj Auto Ltd Maharashtra Scooters Ltd. Bajaj Finserv Ltd (Listed) (Listed) (Listed) Auto business arm Unregistered CIC Financial services arm 74% 80.13% 100% 74% 51.34% 4 Bajaj Finance Ltd Bajaj Allianz
Slide 19: What do we stand for
What do we stand for “Non-bank with strategy & structure of a bank” “Focused on mass affluent & above clients with a strategy to cross sell” “Diversified financial services strategy with an optimal mix of risk and profit to deliver a sustainable business model” “Business construct to deliver a susta
Slide 20: BFL Consolidated long-term guidance on financial metrics
BFL Consolidated long-term guidance on financial metrics AUM growth Profit growth GNPA in corridor of in corridor of in corridor of 25%-27% 23%-24% 1.2%-1.4% NNPA Return on assets Return on equity in corridor of in corridor of in corridor of 0.4%-0.5% 4.6%-4.8% 21%-23% 19
Slide 21: Key strategic differentiators
Key strategic differentiators Part of the Bajaj group – one of the oldest & most A trusted brand with strong brand equity respected business houses Focus on mass affluent and above clients Total customer franchise of 92.09 MM Strong focus on cross selling assets, payments, Highly data oriented. Deep
Slide 22: Our shareholder profile
Our shareholder profile Top 20 investors and their holdings As on 30 As on 30 As on 30 S.No Name of Shareholder Sep 23 Jun 24 Sep 24 1 BAJAJ FINSERV LTD 52.45% 51.34% 51.34% FII & FPI 2 MAHARASHTRA SCOOTERS LIMITED 3.13% 3.07% 3.07% 20.81% 3 GOVERNMENT OF SINGAPORE 3.35% 3.29% 3.06% 4 LIFE INSURANCE
Slide 23: 17-years financial snapshot - Consolidated
17-years financial snapshot - Consolidated ₹ in crore CAGR Financials snapshot @ FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 FY24 (17 yrs.) Loans booked (MM) 1.0 0.6 0.9 1.6 2.2 2.8 3.4 4.9 6.8 10.1 15.3 23.5 27.4 16.9 24.7 29.6 36.2 25% Customer franchise (MM) 0.
Slide 24: 7-years financial snapshot – BHFL
7-years financial snapshot – BHFL ₹ in crore CAGR Financials snapshot FY18 FY19 FY20 FY21 FY22 FY23 FY24 (7 yrs.) AUM (₹ ‘000 Cr) 3.57 17.56 32.71 38.87 53.32 69.23 91.37 72% Total income 106 1,156 2,646 3,155 3,767 5,665 7,617 104% Interest expenses 47 685 1,616 1,966 2,155 3,211 4,692 115% Net tot
Slide 25: Product suite
Product suite BAJAJ FINANCE LIMITED Partnerships Consumer SME Commercial Rural Deposits Payments & Services 1. Consumer Durable Loans 1. Unsecured Working 1. Loan against securities 1. Consumer Durable 1. Retail Term Issuance 1. Life Insurance Capital Loans Loans Deposits 1. PPI Distribution 2. Digi
Slide 26: Executive summary – Bajaj Finance
Executive summary – Bajaj Finance • Focused on Urban, Rural, SME, Commercial and Payments businesses • Strategic business unit organisation design supported by horizontal common utility functions to drive domain expertise, scalability and operating leverage • Focused on cross sell, customer experien
Slide 27: Executive summary – Bajaj Finance
Executive summary – Bajaj Finance • Offers unsecured working capital loans to SME and self-employed professionals • Secured offerings include enterprise loans against property SME Business • Focused on accelerating used car financing business • Focused on affluent SMEs with established financials &
Slide 28: Executive summary – Bajaj Housing Finance
Executive summary – Bajaj Housing Finance • Subsidiary of Bajaj Finance Limited • Independent organisation design having all dedicated functions and units to drive domain expertise, scalability and operating leverage • Offers full range of mortgage products such as home loans, loan against property
Slide 29: Executive summary – Bajaj Housing Finance
Executive summary – Bajaj Housing Finance • Offers LRD to high net-worth individuals and developers against commercial property leased to corporate lessees • Offers construction finance for commercial properties to existing LRD customers Lease Rental • LRD transactions are backed by rentals through
Slide 30: Executive summary – Bajaj Financial Securities
Executive summary – Bajaj Financial Securities • A 100% subsidiary of Bajaj Finance Limited • Offers a wide range of capital market products - Broking, Depositary services, Margin Trade Financing, IPOs and Distribution of Mutual Funds, PMS, and AIF. Overview • Broking business caters to two differen
Slide 31: Section 03: Financial performance – Q2 FY25
3.1 Financial statement summary – Consolidated Section 03 Financial statement summary – 3.2 Bajaj Finance Limited Financial performance Financial statement summary – 3.3 Bajaj Housing Finance Limited 3.4 Financial statement summary – Bajaj Financial Securities Limited 30
Slide 32: Financial summary – Consolidated
Financial summary – Consolidated ₹ in Crore Financials snapshot Q2 FY25 Q2 FY24 Q-o-Q H1 FY25 H1 FY24 H-o-H Assets under management 3,73,924 2,90,264 29% 3,73,924 2,90,264 29% Assets under finance 3,67,491 2,85,748 29% 3,67,491 2,85,748 29% Interest income 14,987 11,733 28% 29,036 22,553 29% Interes
Slide 33: Financial summary – Bajaj Finance
Financial summary – Bajaj Finance ₹ in Crore Financials snapshot Q2 FY25 Q2 FY24 Q-o-Q H1 FY25 H1 FY24 H-o-H Assets under management 2,75,043 2,14,891 28% 2,75,043 2,14,891 28% Assets under finance 2,72,191 2,13,210 28% 2,72,191 2,13,210 28% Interest income 12,598 9,884 27% 24,447 18,991 29% Interes
Slide 34: Financial summary – Bajaj Housing Finance
Financial summary – Bajaj Housing Finance ₹ in Crore Financials snapshot Q2 FY25 Q2 FY24 Q-o-Q H1 FY25 H1 FY24 H-o-H Assets under management 1,02,569 81,215 26% 1,02,569 81,215 26% Assets under finance 89,878 70,954 27% 89,878 70,954 27% Interest income 2,227 1,782 25% 4,290 3,449 24% Interest expen
Slide 35: Financial summary – Bajaj Financial Securities
Financial summary – Bajaj Financial Securities ₹ in Crore Financials snapshot Q2 FY25 Q2 FY24 Q-o-Q H1 FY25 H1 FY24 H-o-H Assets under finance (MTF book) 5,430 2,056 164% 5,430 2,056 164% Interest income 157 68 131% 291 111 162% Interest expenses 93 41 127% 179 68 163% Net interest income 64 27 137%
Slide 36: Section 04: Asset liability management
Conservative leverage standards – 4.1 Consolidated 4.2 Resilient business model – Consolidated Section 04 Behaviouralized ALM – Bajaj Finance 4.3 Limited Asset liability management Behaviouralized ALM – Bajaj Housing 4.4 Finance Limited 4.5 Disciplined ALM Management – Bajaj Finance Limited 4.6 Cons
Slide 37: Conservative leverage standards
Conservative leverage standards 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 28.3% 27.2% 6.8 25.0% 6.6 25.0% 6.3 24.7% 6.3 25.1% 24.8% 22.5% 23.2% 21.7% 21.7% 21.3% 5.4 5.1 21.5% 20.7% 5.1 4.9 20.7% 20.9% 20.3% 4.7 4.9 19.5% 19.7% 4.9 18.0% 4.7 * 16.1% 16.3% 14.2% 14.6% 5.7% 5.0% 4.4% 3.8% 3.4% 3
Slide 38: Resilient business model – Consolidated
Resilient business model – Consolidated 46.5% 45.0% 43.1% 42.5% 41.4% 41.8% 38.4% 37.8% 36.0% 35.3% 35.4% 34.6% 34.0% 33.3% 33.3% 33.2% 30.7% 35.1% 29.9% 33.5% 28.9% 27.2% 27.3% 26.4% 9.87% 9.47% 9.00% 8.24% 8.27% 8.39% 7.84% 7.74% 7.94% 7.97% 6.81% 7.04% 5.3% 5.1% 4.6% 4.5% 3.5% 3.7% 3.9% 4.1% 4.1%
Slide 39: Behaviouralized ALM as of 30 Sep 2024 – BFL
Behaviouralized ALM as of 30 Sep 2024 – BFL ₹ in Crore Particulars, 1-7 D 8-14 D 15-30 D >1-2 M >2-3 M >3-6 M >6 M-1 Y >1-3 Y >3-5 Y >5 Y Total Cash & Investments 21,328 1 4,705 79 27 587 4,909 3,948 599 12,426 48,609 Advances 10,806 2,675 6,760 14,171 13,710 34,018 53,195 1,00,265 27,653 18,838 2,8
Slide 40: Behaviouralized ALM as of 30 Sep 2024 – BHFL
Behaviouralized ALM as of 30 Sep 2024 – BHFL ₹ in Crore Particulars 1-7 D 8-14 D 15-30 D >1-2 M >2-3 M >3-6 M >6 M-1 Y >1-3 Y >3-5 Y >5 Y Total Cash & Investments 86 6 1515 - 10 - 670 - 935 - 3,222 Advances 951 643 843 1815 1782 5112 9084 26872 15629 27147 89,878 Other inflows 150 200 34 388 1013 24
Slide 41: Disciplined ALM Management - BFL
Disciplined ALM Management - BFL Cumulative gap upto 1 month Cumulative gap upto 12 month 220% 216% 119% 120% 118% 93% 85% 96% 61% 80% 59% 81% 71% 51% 48% 57% 60% 50% 54% 31% 44% 43% 32% 31% Mar'15 Mar'16 Mar'17 Mar'18 Mar'19 Mar'20 Mar'21 Mar'22 Mar'23 Mar'24 Jun'24 Sept'24 40
Slide 42: Consolidated liability mix
Consolidated liability mix 3% 4% 3% 1% 2% 2% 4% 5% 5% 3% 10% 12% 13% 5% 9% 4% 7% 8% 13% 9% 3% 14% 3% 2% 2% 7% 6% 4% 1% 1% 1% 33% 38% 36% 34% 35% 40% 32% 34% 37% 36% 40% 45% 33% 30% 36% 31% 30% 29% 28% 54% 48% 34% 35% 25% 20% 19% 21% 21% 20% 20% 17% 12% 13% 6% 8% 4% Mar'15 Mar'16 Mar'17 Mar'18 Mar'19
Slide 43: Section 05: Customer franchise and distribution reach
5.1 Customer franchise Section 05 5.2 Product per customer Customer franchise and distribution reach 5.3 Geographic presence 5.4 Strong distribution reach 42
Slide 44: Customer franchise
Customer franchise Q2 FY24 Q2 FY25 Q1 FY25 Total Franchise 92.09 MM 88.11 MM 76.56 MM 59.68 MM Credit segment filter 76.17 MM 73.28 MM 57.94 MM Overall Cross sell franchise 73.74 MM 70.88 MM Non delinquent 51.31 MM customers 65.82 MM 62.98 MM Cross sell franchise 46.67 MM 57.70 MM 55.14 MM (61.0%)*
Slide 45: Product Per Customer (PPC)
Product Per Customer (PPC) Product Per Customer (PPC) is a business metric used to determine average number of products or services (active or closed) a customer has availed over the lifetime with BFL. Product offerings are classified into 4 product segments: 1. Lending: All lending products of the
Slide 46: Geographic presence
Geographic presence 30 Sep 30 Sep 30 Sep 31 Dec 31 Mar 30 Jun 30 Sep Geographic Presence 2021 2022 2023 2023 2024 2024 2024 Urban lending locations 1,368 1,372 1,469 1,538 1,569 1,585 1,596 Rural lending locations 1,961 2,313 2,465 2,554 2,576 2,617 2,649 Total Bajaj Finance presence 3,329 3,685 3,9
Slide 47: Strong distribution reach
Strong distribution reach Active distribution 30 Sep 2021 30 Sep 2022 30 Sep 2023 31 Dec 2023 31 Mar 2024 30 Jun 2024 30 Sep 2024 Consumer durable stores – Urban 28,000+ 31,400+ 38,850+ 40,150+ 42,000+ 44,200+ 45,300+ Consumer durable stores – Rural 25,600+ 33,500+ 43,350+ 46,300+ 49,050+ 53,050+ 56
Slide 48: Section 06: Business segment wise AUM
Section 06 6.1 Business segment wise AUM - Consolidated Business Segment wise Business segment wise AUM – AUM 6.2 Consolidated Mortgages and BHFL 47
Slide 49: Business segment wise AUM - Consolidated
Business segment wise AUM - Consolidated ₹ in Crore Consolidated Consolidated Composition Composition BFL as of BHFL as of Growth Particulars as of as of as of as of 30 Sep 2024 30 Sep 2024 YoY 30 Sep 2023 30 Sep 2024 30 Sep 2023 30 Sep 2024 Two & Three-wheeler Finance 16,548 18,960 - 18,960 15% 5.7
Slide 50: Business segment wise AUM - Mortgages
Business segment wise AUM - Mortgages ₹ in Crore Composition Composition AUM as of AUM as of Growth Particulars as of as of 30 Sep 2023 30 Sep 2024 YoY 30 Sep 2023 30 Sep 2024 Consolidated mortgages Home Loans 48,858 59,805 22% 53.8% 51.6% Loan Against Property 17,472 22,918 31% 19.2% 19.8% Lease Re
Slide 51: Section 07: Update on credit quality
7.1 Provisioning Coverage - Consolidated 7.2 Stagewise ECL provisioning – Consolidated Section 07 Provisioning Coverage - BHFL Update on credit quality 7.3 7.4 Stagewise ECL provisioning - BHFL 7.5 Portfolio credit quality - Consolidated 50
Slide 52: Provisioning Coverage - Consolidated
Provisioning Coverage - Consolidated ₹ in Crore AUM PCR GNPA % NNPA % Particulars GNPA NNPA 30 Sep 24 (%) 30 Sep 23 30 Jun 24 30 Sep 24 30 Sep 23 30 Jun 24 30 Sep 24 Two & Three-wheeler Finance 18,960 779 408 48% 3.09% 3.41% 3.98% 1.57% 1.85% 2.12% Urban Sales Finance 27,169 222 41 82% 0.59% 0.53% 0
Slide 53: Stagewise ECL provisioning - Consolidated
Stagewise ECL provisioning - Consolidated ₹ in Crore Gross Assets Receivable ECL Provision PCR % Particulars Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Two & Three-wheeler Finance 17,597 1,192 779 112 126 371 0.6% 10.5% 47.6% Urban Sales Finance 27,091 271 222 125 109 18
Slide 54: Provisioning Coverage - BHFL
Provisioning Coverage - BHFL ₹ in Crore AUM PCR GNPA % NNPA % Particulars GNPA NNPA 30 Sept 24 (%) 30 Sep 23 30 Jun 24 30 Sep 24 30 Sep 23 30 Jun 24 30 Sep 24 Home Loans 58,661 172 77 56% 0.24% 0.28% 0.31% 0.10% 0.12% 0.14% Loan Against Property 10,044 57 27 52% 0.74% 0.71% 0.79% 0.30% 0.31% 0.38% L
Slide 55: Stagewise ECL provisioning - BHFL
Stagewise ECL provisioning - BHFL ₹ in Crore Gross Assets Receivable ECL Provision PCR % Particulars Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Stage 1 Stage 2 Stage 3 Home Loans 55,009 176 172 97 41 96 0.2% 23.7% 55.6% Loan Against Property 7,141 104 57 40 23 30 0.6% 22.0% 52.4% Lease Rental D
Slide 56: Portfolio credit quality – Consolidated
Portfolio credit quality – Consolidated Consumer Durable & Lifestyle Two & Three-Wheeler Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 5+ Bucket 1 98.65% 99.64% 99.59% 99.58% 99.51% 99.44% 99.38% 99.45% 99.46% 1 86.00% 91.62
Slide 57: Portfolio credit quality – Consolidated
Portfolio credit quality – Consolidated Business & Professional loans Rural B2B Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 1 99.01% 99.16% 99.25% 99.25% 99.25% 99.07% 98.77% 98.72% 98.63% 1 99.33% 99.70% 99.64% 99.65% 99.
Slide 58: Portfolio credit quality – Consolidated
Portfolio credit quality – Consolidated Car loans Gold loans 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket Stage 1 98.09% 99.34% 99.40% 99.33% 99.34% 99.27% 99.03% 98.79% 98.72% 97.93% 96.14% 96.01% 96.89% 97.80% 97.94% 96.14% 95.
Slide 59: Disclaimer
Disclaimer This presentation has been prepared by and is the sole responsibility of Bajaj Finance Limited (together with its subsidiaries, referred to as the “Company” or “Bajaj Finance”. By accessing this presentation, you are agreeing to be bound by the trailing restrictions. This presentation doe
Slide 60: Thank You
Q2 FY25 Investor Presentation Thank You
Slide 61: Glossary
Glossary Abbreviation Expansion Abbreviation Expansion ALM Asset liability management LRD Lease rental discounting AMO After market order MF Mutual funds AR Augmented reality MFI Microfinance ASSC Authorised sales & support centre MSME Micro, Small & Medium Enterprises AUM Assets under management MT