Satin Creditcare Network Ltd · NSE:SATIN
Satin Creditcare Network — Q3 FY2022 Earnings Presentation
57 slides from Satin Creditcare Network's earnings presentation, January 2022
Slide 1: Investor Presentation January 2022
Investor Presentation January 2022
Slide 2: Contents
Contents 03 - 14 15 - 19 20 - 33 Business Update & New Initiatives Overview and Key Performance What makes Satin a Compelling Highlights Investment Story 34 - 47 48 - 57 Key Financial & Operational Metrices Company Background Cautionary Statement Any forward-looking statements about expected future
Slide 3: Business Update & New Initiatives
Business Update & New Initiatives
Slide 4: Updates – Back to Normalcy (1/2)
Updates – Back to Normalcy (1/2) Collection Efficiency • Jan’22 (till 25th) collection efficiency stood at 101% excl. Assam • Cumulative collection efficiency for Q3FY22 stood at 97% excl. Assam • Non-paying clients decreased to 3% during 9MFY22 from 4% during H1FY22 • For Q3FY22, collection efficie
Slide 5: Updates – Back to Normalcy (2/2)
Updates – Back to Normalcy (2/2) Taking Care of Satin Family • Satin Sahyog to support families of employees, in the event of demise due to COVID-19 or accidental death – benefits include pension, children’s education and job to a family member among others • COVID-19 insurance for Satin staff to he
Slide 6: Update on Preferential Issue
Update on Preferential Issue • During Q3FY22, the Board of Directors of the Company, considered and approved the fund raising by way of the Preferential Issue of Rs. 225 crore • Successfully completed allotment of shares and fully convertible warrants on 25 th Jan’22 Fund Received on Funds to be rec
Slide 7: Update on Assam Portfolio
Update on Assam Portfolio • Assam cabinet approved relief to around 11 lacs microfinance borrowers AUM (Rs. crore) (maximum up to Rs. 25,000 per borrower), who are making regular payments to banks (category 1) % of Total 5.8% 4.3% 4.4% 4.3% 4.0% 3.9% AUM • The Bill is positive for the MFI Industry a
Slide 8: Business Trends
Business Trends… Rs. 7,218 crore Rs. 1,348 crore 28 Lacs 1,214 GROSS LOAN PORTFOLIO DISBURSEMENT in Q3FY22 ACTIVE CUSTOMERS NO. OF BRANCHES Asset under Management Trends (Q-o-Q) Disbursement Trends (Q-o-Q) 607 792 7,880 8,379 7,464 7,381 7,218 300 325 1,104 438 449 972 1,020 1,066 1,095 212 263 6,90
Slide 9: Trends in Collection Efficiency
…Trends in Collection Efficiency Month on Month Collection Efficiency Trends 103% 104% 94% 95% 100% 101% 92% 94% 86% 89% 87% 89% 90% 91% 91% 92% 73% 74% 80% 82% Apr-21 May-21 Jun-21 Jul-21 Aug-21 Sep-21 Oct-21 Nov-21* Dec-21 Jan-22 (till 25th) CE% Incl Assam CE% Excl Assam Collection Efficiency Tren
Slide 10: Trend of % of Non-Paying Customers
Trend of % of Non-Paying Customers Breakup of Paying and Non-Paying Clients* • There is no intent issue since 97% of the borrowers have paid at least one instalment till Dec’21 despite the scare of new COVID-19 waves • As of Dec’21, % AUM on account of borrowers with full payment was 91% as against
Slide 11: Diversifying to Secured Assets – Future Upside Potential
Diversifying to Secured Assets – Future Upside Potential Non-MFI Portfolio • Non-MFI book of the Company includes the MSME and Housing Finance Business • MSME Book grew from Rs. 171 crore in 9MFY19 to Rs. 488 crore in 9MFY22 (i.e. 185% growth) • Housing Finance Book grew from Rs. 45 crore in 9MFY19
Slide 12: Update on Subsidiaries – SHFL Covered All Losses
Update on Subsidiaries – SHFL Covered All Losses Satin Housing Finance Limited AUM grew by 41% in Q3FY22 YoY SHFL had 5 successive profitable quarters despite Q3FY22 disbursement stood at Rs. 44 crore challenging business environment, PAT for 9MFY22 stood at Rs. 1.9 crore No Restructuring done No wi
Slide 13: Update on Subsidiaries – TFSL & SFL
Update on Subsidiaries – TFSL & SFL Taraashna ✓ Collection efficiency for Dec’21 stood at 96% Financial ✓ Disbursement stood at Rs. 191 crore for Q3FY22 Services Limited ✓ Sourcing business for SCNL & SFL under Nai Roshni ✓ AUM growth of 13% YoY in Q3FY22 ✓ Healthy CRAR of 75.0% Satin Finserv ✓ Cumu
Slide 14: Objective Behind Amalgamation
Objective Behind Amalgamation The combined entity would be able to efficiently use the capital invested in the two entities and leverage the same Currently the revenue sharing arrangement between TFSL and SFL is taxable. In the combined entity, tax benefit will accrue to the business TFSL has signif
Slide 15: Overview
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Slide 16: Fostering Inclusive Growth
Fostering Inclusive Growth The history of SCNL goes back to 1990 when it started providing finance to the shopkeepers who were deprived of formal financing Today, after three decades of rich experience, SCNL has emerged as one of the leading and trusted Indian microfinance companies Headquartered in
Slide 17: Key Performance Highlights
Key Performance Highlights
Slide 18: Corporate Overview Standalone – Q3FY22
Corporate Overview Standalone – Q3FY22 Rs. 1,085 crore 27.1 Lacs 23 1,028 DISBURSEMENT LOAN ACCOUNTS STATES & UT’s BRANCHES OUTSTANDING 2.6 Lacs Rs. 6,123 crore Rs. 40 crore NO. OF LOANS DISBURSED GROSS LOAN PORTFOLIO PROFIT AFTER TAX 24.0% 2.2% Rs. 43,000 11.2% CAPITAL ADEQUACY RETURN ON ASSETS^ AV
Slide 19: Corporate Overview Consolidated – Q3FY22
Corporate Overview Consolidated – Q3FY22 Rs. 348 crore 28 Lacs 1,214 REVENUES CLIENTS BRANCHES Rs. 194 crore Rs. 7,218 crore 23 NET INTEREST INCOME GROSS LOAN PORTFOLIO STATES & UT’s 1.8% 9.4% Rs. 34 crore RETURN ON ASSETS^ RETURN ON EQUITY^ PROFIT AFTER TAX 19 ^ROA & ROE are annualized
Slide 20: What makes Satin a Compelling Investment Story
What makes Satin a Compelling Investment Story
Slide 21: What makes Satin a Compelling Investment Story
What makes Satin a Compelling Investment Story Leading MFI Player With Differentiated Product Offerings 01 Diversified Geographical Reach 02 03 Technology Prowess 04 Robust Underwriting Processes 05 Well-diversified Liability Profile 06 Ample Liquidity & Positive ALM 07 Strong & Experienced Manageme
Slide 22: Differentiated Product Offerings
1. Differentiated Product Offerings Business Correspondent SCNL Housing Finance SME Services Product features Taraashna Financial Services MFI(1) Satin Housing Finance Limited(3) Satin Finserv Limited (SFL)(4) as on Dec’21 Limited(2) Start Date May’08 (JLG) May’12 Feb’18 Mar’19 Upto Rs. 50,000 Ticke
Slide 23: With opportunities to leverage our client reach
…With opportunities to leverage our client reach Satin finances product purchase of solar lamps, bicycles, consumer durables etc. and grants loan for safe water and sanitation facilities Financing ~Rs. 29 crore during 9MFY22, business started picking up Product Financing Benefits ▪ Enhances the prod
Slide 24: Diversified Geographical Presence
2. Diversified Geographical Presence …serving 28 lacs clients across India 59% 28 Lacs 31 Lacs Clients with Satin as Only No. of Active Clients No. of Loan Accounts Lender* 387 82,300 No. of Districts No. of Villages 77 2.5 Lacs No. of Regional Offices No. of Centres 24% 9,031 12,888 First Cycle Cli
Slide 25: Leading to increasing footprints
…Leading to increasing footprints % of total GLP GLP (Rs. crore) States FY16 Q3FY22 Q3FY22 UTTAR PRADESH 40.9% 21.6% 1,597 BIHAR 17.7% 13.8% 1,018 MADHYA PRADESH 15.5% 8.2% 607 2. Reducing exposure to traditional regions PUNJAB 12.7% 7.8% 576 UTTARAKHAND 3.2% 1.4% 104 JAMMU & KASHMIR 0.1% 0.1% 4 90.
Slide 26: And de-risking geographical concentration
…And de-risking geographical concentration To remain a PAN India Player Share of Top 4 States Reduced from 77% to 51% Limiting Exposure per district Average exposure per district % % of Top 10 Districts to AUM 77.3 -51% 10.1 67.7 10.2 56.3 58.6 54.0 19.2 51.5 0.45 12.9 8.4 9.6 8.7 7.8 21 8.8 9.3 8.7
Slide 27: A Difference Powered by Technological Prowess & Processes
3. A Difference Powered by Technological Prowess & Processes… Turnaround Time : Game Changing Gold Standard Information Security. Customer Acquision to Disbursement Journey Digital Transformation Technology ISO 27001:2013 Certified reduced from 18 days to few minutes • Online real-time system • DMS
Slide 28: Leading to Operating Efficiency & Scalability
…Leading to Operating Efficiency & Scalability New initiatives… ...leading to improved processes Centralized processes Reduced TAT KYC Compliance & Real- time Credit Bureau checks Real-time Decision Making Auto bank reconciliation Faster Book Closing using API Enhanced Productivity Penny drop verifi
Slide 29: Robust Underwriting & Full-fledged in-house Internal Audit
4. Robust Underwriting & Full-fledged in-house Internal Audit Robust Underwriting Full-fledged in-house Internal Audit Real-time Credit Bureau checks to track loan history of the prospective clients, Credit Bureau scorecard for individual clients for better screening 107 Feedback based Zonal Auditor
Slide 30: We have a well-diversified Liability Profile
5. We have a well-diversified Liability Profile… …insulated from Capital Market Turbulence Large Lender Base Product-wise Dec’21 55 Active Lenders 0.6% Top 10 Lending Partners % Share as on 31st Dec’21 5.2% Indian Bank 10% 18.5% Term Loan NABARD 8% NCD 47.3% IDFC First Bank 7% Buyout Bank of Baroda
Slide 31: Strong Capitalization with Ample Liquidity
6. Strong Capitalization with Ample Liquidity Healthy CRAR to Support Growth Opportunities Benefit of Positive ALM Continues 26.3 24.9 30.5% 22.3 22.1 23.0 28.5% 21.5 25.3% 24.0% 21.2% 15.5 14.5 11.7 12.6 8.5 9.0 FY17 FY18 FY19 FY20 FY21 Q3FY22 FY18 FY19 FY20 FY21 Q3FY22 Avg. maturity of Assets Avg.
Slide 32: Diversification with Allied Product Offerings
Diversification with Allied Product Offerings Taraashna Financial Services Ltd - TFSL Satin Housing Finance Ltd (SHFL) Satin Finserv Limited (SFL) » Acting as a business correspondent, TFSL » 100% retail book comprising of: » Incorporated in Aug’18, got license from RBI to provides credit to clients
Slide 33: Successfully Navigated Crisis During Legacy of 30 Years
Successfully Navigated Crisis During Legacy of 30 Years Implementation of best-in-class technology Strong Capitalization with Ample Liquidity • Reduced TAT • Capital Adequacy has improved from 18.3% in 2016 to 24.0% currently • Real-time data • Raised Rs 785 crore equity capital Learnings • Enha
Slide 34: Key Financial & Operational Metrices
Key Financial & Operational Metrices
Slide 35: Key Operation Metrics
Key Operation Metrics Districts, States and Branches Employees & Loan Officers 9,0312 1,257 1,2141 8,090 1,383 8,152 1,163 6,296 995 6,382 767 22 23 23 23 12,8883 4,481 13,005 12,726 11,831 18 1,495 1,790 1,696 16 1,325 9,004 6,910 1,344 383 388 387 340 1,109 302 11,148 10,612 10,783 235 10,419 7,65
Slide 36: Key Consolidated Financials
Key Consolidated Financials Gross Income (Rs. crore) Cost to Income Ratio (%) 1,445 1,503 1,380 69.0% 60.6% 1,017 53.4% 52.5% FY19 FY20 FY21 9MFY22 FY19 FY20 FY21 9MFY22* NII and PAT (Rs. crore) Opex to Avg AUM (%) 914 NII 803 742 PAT 6.7% 6.3% 6.4% 544 5.4% 201 155 -14 -36 FY19 FY20 FY21 9MFY22 FY1
Slide 37: Key Standalone Financials
Key Standalone Financials Gross Income (Rs. crore) Cost to Income Ratio (%) 1,373 1,401 1,273 66.4% 57.7% 931 50.8% 49.7% FY19 FY20 FY21 9MFY22 FY19 FY20 FY21 9MFY22* NII and PAT (Rs. crore) Opex to Avg AUM (%) 824 6.5% 6.3% NII 6.0% 734 655 PAT 5.2% 476 195 156 -14 -19 FY19 FY20 FY21 9MFY22 FY19 FY
Slide 38: Financial & Operational Details (Consolidated)
Financial & Operational Details (Consolidated)
Slide 39: Annexure – Business Details – Consolidated
Annexure – Business Details – Consolidated Particulars Q3FY22 Q3FY21 YoY% Q2FY22 QoQ% AUM (Rs. crore) 7,218 7,880 -8.4% 7,381 -2.2% SCNL 6,123 6,912 6,315 On-book AUM 5,249 5,333 5,371 Assignment 771 1,216 795 Business Correspondence 103 362 149 TFSL 676 646 682 (1) SHFL 275 195 246 SFL 144 127 138
Slide 40: Annexure – P&L Statement – Consolidated
Annexure – P&L Statement – Consolidated Particulars (Rs. crore) 9MFY22 9MFY21 YoY% Q3FY22 Q3FY21 YoY% Q2FY22 QoQ FY21 Revenue Interest and Fee Income 885 780 296 270 286 1,076 (Loss)/Gain due to DA 12 58 15 0 1 112 Treasury Income 47 58 15 18 14 71 BC Fees 56 57 18 24 19 88 Other Operating Income 16
Slide 41: Financial Details (Standalone)
Financial Details (Standalone)
Slide 42: Annexure - Financial Performance – Standalone
Annexure - Financial Performance – Standalone Particulars (Rs. crore) 9MFY22 9MFY21 Q3FY22 Q3FY21 Q2FY22 FY21 FY20 Gross yield (1) 18.54% 16.99% 20.36% 17.19% 18.73% 17.57% 20.61% Financial Cost Ratio(2) 9.07% 8.69% 9.53% 8.85% 9.40% 8.52% 8.49% Net Interest Margin(3) 9.47% 8.30% 10.82% 8.34% 9.33%
Slide 43: Annexure - P&L Statement – Standalone
Annexure - P&L Statement – Standalone Particulars (Rs. crore) 9MFY22 9MFY21 YoY% Q3FY22 Q3FY21 YoY% Q2FY22 QoQ% FY21 Revenue Interest and Fee Income 846 748 282 259 274 1,031 (Loss)/Gain due to DA 11 58 14 - 1 110 Treasury Income 44 54 14 14 16 66 BC Income 17 20 4 10 6 35 Other Operating Income 13
Slide 44: Financial Details (Subsidiaries)
Financial Details (Subsidiaries)
Slide 45: Annexure - P&L Statement – TFSL
Annexure - P&L Statement – TFSL Particulars (Rs. crore) 9MFY22 9MFY21 Q3FY22 Q3FY21 Q2FY22 FY21 Revenue Total Revenue 50.1 41.6 20.6 13.1 15.9 59.3 Expenses Finance Cost 4.1 3.2 1.5 1.2 1.4 4.5 Employee Benefit Expenses 36.7 26.6 13.4 9.2 11.8 39.1 Credit Cost 26.4 1.0 12.5 -0.3 6.0 11.3 Other Expen
Slide 46: Annexure - P&L Statement – SHFL
Annexure - P&L Statement – SHFL Particulars (Rs. crore) 9MFY22 9MFY21 Q3FY22 Q3FY21 Q2FY22 FY21 Revenue Interest and Fee Income 24.3 17.7 8.7 6.6 7.8 25.8 Treasury Income 0.4 0.3 0.2 0.0 0.3 0.3 Other income 1.6 1.1 0.8 0.6 0.2 3.5 Total Revenue 26.3 19.1 9.7 7.2 8.2 29.6 Expenses Finance cost 11.8
Slide 47: Annexure - P&L Statement – SFL
Annexure - P&L Statement – SFL Particulars (Rs. crore) 9MFY22 9MFY21 Q3FY22 Q3FY21 Q2FY22 FY21 Revenue Interest and Fee Income 19.1 17.3 6.9 5.9 6.3 23.8 Treasury Income 0.3 0.4 0.2 0.1 0.1 0.4 Other income 0.3 0.5 0.2 0.1 0.1 0.6 Total Revenue 19.7 18.2 7.3 6.1 6.5 24.8 Expenses Finance cost 4.5 3.
Slide 48: Company Background
Company Background
Slide 49: Key Milestones
Key Milestones Business Timeline 2016 2017 2018 2019 2020 Received NBFC license for SHFL commenced lending in Started MSME Lending in Reached 27.1 lacs active Satin Finserv Ltd for MSME Received the Award of Feb18; BC agreement with FY17; Acquired TFSL in clients and AUM of Rs. 4,882 business; reach
Slide 50: Key Milestones
Key Milestones Fund Raising Timeline 2015 2016 2017 2018 2019/20 2021 ▪ Raised Rs. 41.5 crore ▪ Raised Rs. 250 crore ▪ In Apr’17, raised $10 ▪ Pref. Allotment: ▪ Exit of MV Mauritius ▪ Successfully from SBI FMO(3) via QIP in Oct’16; mn from ADB(4) ; Equity funding by completed (including warrants);
Slide 51: Our Business Model
Our Business Model Formation of Documentation Groups and Paper work MICROFINANCE… & BEYOND 01 06 02 Social impact financing Follow up Income Generating of solar lamps, loans Long Term Loans (LTL) Loans (IGL) bicycles, water and Training sanitation facilities etc. of Groups 05 03 Micro Small & Medium
Slide 52: With Customised Products as per Client Needs
…With Customised Products as per Client Needs Income Generation Loan Long Term Loan Product Financing/Wash (Prarambh) (Vriddhi) Loan Ticket Size : Ticket Size : Ticket Size : Rs. 10,000 – Rs. 30,000 Rs. 31,000 – Rs. 50,000 Rs. 799 – Rs. 21,999 Tenure : 24 months Tenure : 24 months Tenure : 3-18 mont
Slide 53: Making a Difference to the Community
Making a Difference to the Community Supporting Local Communities Health Check-up Camps SCNL was Appreciation During COVID-19 Pandemic Free health check-up camps in Assam and awarded an by the local Distributed masks, ration and hygiene kits across Odisha appreciation administration districts in Pun
Slide 54: Awards and Accolades
Awards and Accolades ▪ Mr. HP Singh, CMD, received the “CEO of the Year - Micro Finance Company” Award ▪ Mr. HP Singh, CMD, was conferred the Best CEO of the Year at ‘Golden Globe Tigers” virtual awards ceremony in Malaysia ▪ Mr. HP Singh received the ‘Exemplary Leader’ Award ▪ Mr. HP Singh received
Slide 55: Shareholding Pattern
Shareholding Pattern Shareholding as on 31st December, 2021 Retail & Others Update on Recent Corporate Action 22.0% Promoters 38.3% • During Q3FY22, the Board of Directors of the Company, considered and approved the fund raising Bodies by way of the Preferential Issue of Rs. 225 crore Corporate 14.5
Slide 56: ESG Snapshot
ESG Snapshot Environment Social Water and Sanitation (WASH) Loans • Our strength lies in our ground level knowledge and the strong bond that we have • SCNL has been constructively working towards safe water and sanitation in around 120 created with our stakeholders districts and more than 30,000 vil
Slide 57: Contact Information
Contact Information Company (Investors & Media) : Ms. Aditi Singh Head – Strategy E: aditi.singh@satincreditcare.com T: +91 124 4715 400 (Ext – 7004) www.satincreditcare.com
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