Trucap Finance Limited · NSE:TRU
Trucap Finance — Q2 FY24 Earnings Presentation
59 slides from Trucap Finance's earnings presentation, Nov 9, 2023
Slide 1: Earnings presentation filing letter to stock exchanges
November 09, 2023 To, To, The General Manager The Manager Department of Corporate Services Department of Corporate Compliance BSE Limited National Stock Exchange of India Limited Phiroze Jeejeebhoy Towers, Exchange Plaza, Bandra Kurla Complex, Dalal Street, Mumbai – 400 001. Bandra (East), Mumbai –
Slide 2: TruCap Finance Ltd
TruCap Finance Ltd
Slide 3: Safe Harbor
Safe Harbor This presentation is not a prospectus, a statement in lieu of a prospectus, an ofering circular / memorandum, an advertisement, an ofer, an invitation to ofer or an ofer document in terms of the Companies Act, 2013, the Securities and Exchange Board of India (Issue of Capital and Disclos
Slide 4: TRU Lender to India's MSME Needs
TRU Lender to India’s MSME Needs TRUST TRU Promise T TRANSPARENCY TECHNOLOGY We stand by the belief that technology & capital can be employed to catalyze the growth journey of MSMEs. It can bring positive social impact by creating opportunities & supporting livelihoods through fostering of talent an
Slide 5: Key Highlights and Recent Developments
Key Highlights and Recent Developments
Slide 6: Key Highlights – Q2 FY24
Key Highlights – Q2 FY24 INR Mn The company has announced an equity infusion of INR Particulars Mar’23 Jun’23 Sept’23 1.68 billion in the form of warrants and compulsory Disbursements (Excl. Renewal) 2,375 2,608 2,946 convertible debentures that is expected to be completed by the end of December 202
Slide 7: Quarterly Disbursements focused on MSME Business & Gold loans
Quarterly Disbursements focused on MSME Business & Gold loans Quarterly Disbursement (INR Mn) Active Borrower Count 80,552 2,946 2,608 67,997 64,596 64,824 2,354 57,152 1,752 45,988 1,552 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 90% y/y growth in quarterly disburs
Slide 8: Granular & Capital Efficient Portfolio mix
Granular & Capital Efficient Portfolio mix Gross Loan Portfolio (AUM) INR Mn* Focused MSME Gold and Business Portfolio 7,803 17% 5,810 40% 43% 47% 50% 57% 33% 61% 64% 3,059 44% 46% 45% 44% 1,044 39% 36% 34% 493 372 FY’19 FY’20 FY’21 FY’22 FY’23 H1 FY’24 FY’21 FY’22 Jun’22 Sep’22 Dec’22 Mar’23 Jun’23
Slide 9: Loan growth with Increasing Capital Efficiency through L-a-a-S Partnerships
Loan growth with Increasing Capital Efficiency through L-a-a-S Partnerships Gross Loan Portfolio (AUM) INR Mn* L-a-a-s AUM (INR Mn) as a % of Total AUM 7,803 6,597 5,810 3,075 4% 12% 20% 24% 5,104 2,209 28% 33% 39% 4,549 1,611 3,952 1,217 894 3,059 490 122 96% 88% 80% 76% 4,388 4,728 72% 4,200 67% 61
Slide 10: ~INR 6 billion of L-a-a-S Disbursements
~INR 6 billion of L-a-a-S Disbursements Benefit for TRU Jun’22 Sep’22 Dec’22 Mar’23 Jun’23 Sep’23 Sourcing partnership with large lenders to L-a-a-S Disbursement (INR Mn) 470 574 645 1,258 2,057 2,048 realize last mile affordable credit inclusion. L-a-a-S Disbursement % 23% 29% 30% 33% 43% 46% TRU se
Slide 11: Sturdy Improvement in Asset Quality...
Sturdy Improvement in Asset Quality... Asset Quality (GNPA%) 6.0% 5.1% 3.0% 3.0% 2.2% 1.1% 1.1% FY'19 FY'20 FY'21 FY'22 FY'23 Q1 FY'24 Q2 FY'24 GNPAs in the gold loan book are negligible at 0.05%; Business loan are currently 2.8% Gold taken to auctions are INR 57 Mn (0.3% of cumulative disbursements
Slide 12: … Driven by Strong Product level Portfolio Performance
… Driven by Strong Product level Portfolio Performance INR Mn Jun’22 Sep’22 Dec’22 Product AUM % of AUM GNPA% AUM % of AUM GNPA% AUM % of AUM GNPA% MSME GL 1,704 43% 0.5% 2,120 47% 0.3% 2,533 50% 0.2% MSME BL 1,817 46% 2.2% 2,042 45% 2.1% 2,240 44% 2.6% LAP + PL 436 11% 16.8% 388 9% 19.9% 331 6% 23.
Slide 13: Robust Collection Efficiency driven by Gold Loans
Robust Collection Efficiency driven by Gold Loans INR Mn Month Demand Collection Collection Payment & CE including for the for the efficiency foreclosures prepyament month month (CE) for the in the /part payment month month Oct-22 212 189 89% 291 227% Nov-22 196 176 90% 371 279% Dec-22 214 193 90% 544
Slide 14: Omnichannel Distribution Platform Powering Capital Efficient Loan Growth
Omnichannel Distribution Platform Powering Capital Efficient Loan Growth
Slide 15: Multi Channel Distribution Built in the Last Few Years…
Multi Channel Distribution Built in the Last Few Years… Experiential Centers Offers Superior Value Proposition Captive Sales Team for MSME Customers in GL & BL TRU has a team of ~600 Strong Feet on Street Significantly enabling financial inclusion in 8 key states These individuals play an instrumental
Slide 16: … with Technology as a Strong Enabler
… with Technology as a Strong Enabler TRUSS Portal : Tech-enabled Efficiency Trust Security Reliability Automation The portal is being built as a critical asset to fulfill long-term requirements of internal & externals stakeholders while eliminating need for manual intervention in standardized but vol
Slide 17: Cluster-based Distribution Network…
Cluster-based Distribution Network… 122 Experiential Centres 34 Maharashtra 22 Madhya Pradesh 20 Delhi NCR/ Haryana 14 Gujarat 14 Rajasthan 10 Punjab 8 Goa Expanding network to cater to MSME customers for both Gold & Business Loans The states of Maharashtra, Gujarat, MP, Haryana and Delhi-NCR compri
Slide 18: ...Focused Largely in Tier II/III/IV Towns
...Focused Largely in Tier II/III/IV Towns Increasing Branch Distribution with Focus on Tier II/III/IV AUM distribution Over the Years Total Branch additions FY’20 FY’21 FY’22 FY’23 Q1FY’24 Q2FY’24 State Mar’19 Mar’20 Mar’21 Mar’22 Mar'23 Jun'23 Sep'23 branches Delhi/NCR 3 4 Maharastra 100% 100% 81.
Slide 19: Helping Serve Large Number of Customers
Helping Serve Large Number of Customers Customer served Women Customer Served 2,30,429 52,763 1,90,237 44,018 1,55,294 36,079 61,159 11,906 7,742 11 29 71 1,260 101 243 462 FY'18 FY'19 FY'20 FY'21 FY'22 FY'23 Q1 FY'24 Q2 FY'24 FY'18 FY'19 FY'20 FY'21 FY'22 FY'23 Q1 FY'24 Q2 FY'24 23% of the total cu
Slide 20: Solving for Access and Inclusion...
Solving for Access and Inclusion... Non-metro borrowers’ Entrepreneurs funded Borrowers having exposure below coverage (active borrowers) INR 5L ticket size 2,21,688 72,956 53,887 46,408 57,517 1,50,014 26,428 19,127 59,449 2,319 1,591 7,330 Mar’21 Mar’22 Mar’23 H1FY’24 Mar’21 Mar’22 Mar’23 H1FY’24
Slide 21: ...Including Women Entrepreneurs and new to credit borrowers
...Including Women Entrepreneurs and new to credit borrowers Women borrowers’ coverage Active NTC borrowers’ coverage Thinfile* women borrowers’ coverage 52,756 23,488 12,223 22,531 19,889 10,696 36,079 8,844 11,906 2,927 1,260 442 Mar’21 Mar’22 Mar’23 H1FY’24 Mar’21 Mar’22 Mar’23 H1FY’24 Mar’21 Mar’
Slide 22: Risk & Governance
Risk & Governance
Slide 23: Comprehensive Risk Management Framework
Comprehensive Risk Management Framework Action Undertaken Aspects Covered Objective Achieved / To Be Achieved Risk Assessment Framework Credit, liquidity, solvency, financial, Common standards for management and information security risks of various risks at portfolio level Independent unit for inter
Slide 24: Standardised Branch Score Card Mitigate Risk and Maintain Quality Service
Standardised Branch Score Card Mitigate Risk and Maintain Quality Service Standard Branch Audit Score Branch Score Matrix Card Mechanism Standard scoring mechanism following weighted Risk Rating average mechanism based upon risk rating of 12 comprehensive processes and 130 checkpoints High C RBI ten
Slide 25: Focus on Governance
Focus on Governance Independent and Eminent Board Comprising of Industry Stalwarts Rakesh Sethi Nirmal Momaya Atwood Porter Collins Rajiv Kapoor KP Raghuvanshi Non-Executive Chairman Independent Director Non-executive Director Non-executive Director Independent Director Past experience: Past experie
Slide 26: Shareholding Pattern
Shareholding Pattern Substantial management ownership in the company FII 8.5% Promoter - Wilson Group 49.6% Public 41.9% Promoter Group FII Public Shareholding on fully diluted basis as on Sep’23
Slide 27: Q2 FY'24 Results
Q2 FY’24 Results
Slide 28: Income Statement
Income Statement INR Mn Strong revenue growth driven by consistent disbursement trajectory Income Statement Mar’23 Jun’23 Sep’23 Sturdy q/q growth in profits Interest Income 225 266 270 Less: Finance Cost 149 173 182 Net Interest Income 76 93 88 Other Income 102 112 157 Operating Expenses 164 188 219
Slide 29: Balance Sheet
Balance Sheet INR Mn High level of liquidity to protect the balance Balance Sheet Mar’23 Jun’23 Sep’23 sheet from any exogenous shocks. Low debt equity levels at 2.0x Financials Assets 6,300 6,031 6,540 Cash and Investments 1,183 865 867 Gross Loans 4,200 4,388 4,728 Less: Impairment Loss Allowance
Slide 30: Thank You
Thank You
Slide 31: TruCap Finance Ltd
TruCap Finance Ltd
Slide 32: Safe Harbor
Safe Harbor This presentation is not a prospectus, a statement in lieu of a prospectus, an ofering circular / memorandum, an advertisement, an ofer, an invitation to ofer or an ofer document in terms of the Companies Act, 2013, the Securities and Exchange Board of India (Issue of Capital and Disclos
Slide 33: TRU Lender to India's MSME Needs
TRU Lender to India’s MSME Needs TRUST TRU Promise T TRANSPARENCY TECHNOLOGY We stand by the belief that technology & capital can be employed to catalyze the growth journey of MSMEs. It can bring positive social impact by creating opportunities & supporting livelihoods through fostering of talent an
Slide 34: Key Highlights and Recent Developments
Key Highlights and Recent Developments
Slide 35: Key Highlights – Q2 FY24
Key Highlights – Q2 FY24 INR Mn The company has announced an equity infusion of INR Particulars Mar’23 Jun’23 Sept’23 1.68 billion in the form of warrants and compulsory Disbursements (Excl. Renewal) 2,375 2,608 2,946 convertible debentures that is expected to be completed by the end of December 202
Slide 36: Quarterly Disbursements focused on MSME Business & Gold loans
Quarterly Disbursements focused on MSME Business & Gold loans Quarterly Disbursement (INR Mn) Active Borrower Count 80,552 2,946 2,608 67,997 64,596 64,824 2,354 57,152 1,752 45,988 1,552 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 Jun-22 Sep-22 Dec-22 Mar-23 Jun-23 Sep-23 90% y/y growth in quarterly disburs
Slide 37: Granular & Capital Efficient Portfolio mix
Granular & Capital Efficient Portfolio mix Gross Loan Portfolio (AUM) INR Mn* Focused MSME Gold and Business Portfolio 7,803 17% 5,810 40% 43% 47% 50% 57% 33% 61% 64% 3,059 44% 46% 45% 44% 1,044 39% 36% 34% 493 372 FY’19 FY’20 FY’21 FY’22 FY’23 H1 FY’24 FY’21 FY’22 Jun’22 Sep’22 Dec’22 Mar’23 Jun’23
Slide 38: Loan growth with Increasing Capital Efficiency through L-a-a-S Partnerships
Loan growth with Increasing Capital Efficiency through L-a-a-S Partnerships Gross Loan Portfolio (AUM) INR Mn* L-a-a-s AUM (INR Mn) as a % of Total AUM 7,803 6,597 5,810 3,075 4% 12% 20% 24% 5,104 2,209 28% 33% 39% 4,549 1,611 3,952 1,217 894 3,059 490 122 96% 88% 80% 76% 4,388 4,728 72% 4,200 67% 61
Slide 39: ~INR 6 billion of L-a-a-S Disbursements
~INR 6 billion of L-a-a-S Disbursements Benefit for TRU Jun’22 Sep’22 Dec’22 Mar’23 Jun’23 Sep’23 Sourcing partnership with large lenders to L-a-a-S Disbursement (INR Mn) 470 574 645 1,258 2,057 2,048 realize last mile affordable credit inclusion. L-a-a-S Disbursement % 23% 29% 30% 33% 43% 46% TRU se
Slide 40: Sturdy Improvement in Asset Quality...
Sturdy Improvement in Asset Quality... Asset Quality (GNPA%) 6.0% 5.1% 3.0% 3.0% 2.2% 1.1% 1.1% FY'19 FY'20 FY'21 FY'22 FY'23 Q1 FY'24 Q2 FY'24 GNPAs in the gold loan book are negligible at 0.05%; Business loan are currently 2.8% Gold taken to auctions are INR 57 Mn (0.3% of cumulative disbursements
Slide 41: … Driven by Strong Product level Portfolio Performance
… Driven by Strong Product level Portfolio Performance INR Mn Jun’22 Sep’22 Dec’22 Product AUM % of AUM GNPA% AUM % of AUM GNPA% AUM % of AUM GNPA% MSME GL 1,704 43% 0.5% 2,120 47% 0.3% 2,533 50% 0.2% MSME BL 1,817 46% 2.2% 2,042 45% 2.1% 2,240 44% 2.6% LAP + PL 436 11% 16.8% 388 9% 19.9% 331 6% 23.
Slide 42: Robust Collection Efficiency driven by Gold Loans
Robust Collection Efficiency driven by Gold Loans INR Mn Month Demand Collection Collection Payment & CE including for the for the efficiency foreclosures prepyament month month (CE) for the in the /part payment month month Oct-22 212 189 89% 291 227% Nov-22 196 176 90% 371 279% Dec-22 214 193 90% 544
Slide 43: Omnichannel Distribution Platform Powering Capital Efficient Loan Growth
Omnichannel Distribution Platform Powering Capital Efficient Loan Growth
Slide 44: Multi Channel Distribution Built in the Last Few Years…
Multi Channel Distribution Built in the Last Few Years… Experiential Centers Offers Superior Value Proposition Captive Sales Team for MSME Customers in GL & BL TRU has a team of ~600 Strong Feet on Street Significantly enabling financial inclusion in 8 key states These individuals play an instrumental
Slide 45: … with Technology as a Strong Enabler
… with Technology as a Strong Enabler TRUSS Portal : Tech-enabled Efficiency Trust Security Reliability Automation The portal is being built as a critical asset to fulfill long-term requirements of internal & externals stakeholders while eliminating need for manual intervention in standardized but vol
Slide 46: Cluster-based Distribution Network…
Cluster-based Distribution Network… 122 Experiential Centres 34 Maharashtra 22 Madhya Pradesh 20 Delhi NCR/ Haryana 14 Gujarat 14 Rajasthan 10 Punjab 8 Goa Expanding network to cater to MSME customers for both Gold & Business Loans The states of Maharashtra, Gujarat, MP, Haryana and Delhi-NCR compri
Slide 47: ...Focused Largely in Tier II/III/IV Towns
...Focused Largely in Tier II/III/IV Towns Increasing Branch Distribution with Focus on Tier II/III/IV AUM distribution Over the Years Total Branch additions FY’20 FY’21 FY’22 FY’23 Q1FY’24 Q2FY’24 State Mar’19 Mar’20 Mar’21 Mar’22 Mar'23 Jun'23 Sep'23 branches Delhi/NCR 3 4 Maharastra 100% 100% 81.
Slide 48: Helping Serve Large Number of Customers
Helping Serve Large Number of Customers Customer served Women Customer Served 2,30,429 52,763 1,90,237 44,018 1,55,294 36,079 61,159 11,906 7,742 11 29 71 1,260 101 243 462 FY'18 FY'19 FY'20 FY'21 FY'22 FY'23 Q1 FY'24 Q2 FY'24 FY'18 FY'19 FY'20 FY'21 FY'22 FY'23 Q1 FY'24 Q2 FY'24 23% of the total cu
Slide 49: Solving for Access and Inclusion...
Solving for Access and Inclusion... Non-metro borrowers’ Entrepreneurs funded Borrowers having exposure below coverage (active borrowers) INR 5L ticket size 2,21,688 72,956 53,887 46,408 57,517 1,50,014 26,428 19,127 59,449 2,319 1,591 7,330 Mar’21 Mar’22 Mar’23 H1FY’24 Mar’21 Mar’22 Mar’23 H1FY’24
Slide 50: ...Including Women Entrepreneurs and new to credit borrowers
...Including Women Entrepreneurs and new to credit borrowers Women borrowers’ coverage Active NTC borrowers’ coverage Thinfile* women borrowers’ coverage 52,756 23,488 12,223 22,531 19,889 10,696 36,079 8,844 11,906 2,927 1,260 442 Mar’21 Mar’22 Mar’23 H1FY’24 Mar’21 Mar’22 Mar’23 H1FY’24 Mar’21 Mar’
Slide 51: Risk & Governance
Risk & Governance
Slide 52: Comprehensive Risk Management Framework
Comprehensive Risk Management Framework Action Undertaken Aspects Covered Objective Achieved / To Be Achieved Risk Assessment Framework Credit, liquidity, solvency, financial, Common standards for management and information security risks of various risks at portfolio level Independent unit for inter
Slide 53: Standardised Branch Score Card Mitigate Risk and Maintain Quality Service
Standardised Branch Score Card Mitigate Risk and Maintain Quality Service Standard Branch Audit Score Branch Score Matrix Card Mechanism Standard scoring mechanism following weighted Risk Rating average mechanism based upon risk rating of 12 comprehensive processes and 130 checkpoints High C RBI ten
Slide 54: Focus on Governance
Focus on Governance Independent and Eminent Board Comprising of Industry Stalwarts Rakesh Sethi Nirmal Momaya Atwood Porter Collins Rajiv Kapoor KP Raghuvanshi Non-Executive Chairman Independent Director Non-executive Director Non-executive Director Independent Director Past experience: Past experie
Slide 55: Shareholding Pattern
Shareholding Pattern Substantial management ownership in the company FII 8.5% Promoter - Wilson Group 49.6% Public 41.9% Promoter Group FII Public Shareholding on fully diluted basis as on Sep’23
Slide 56: Q2 FY'24 Results
Q2 FY’24 Results
Slide 57: Income Statement
Income Statement INR Mn Strong revenue growth driven by consistent disbursement trajectory Income Statement Mar’23 Jun’23 Sep’23 Sturdy q/q growth in profits Interest Income 225 266 270 Less: Finance Cost 149 173 182 Net Interest Income 76 93 88 Other Income 102 112 157 Operating Expenses 164 188 219
Slide 58: Balance Sheet
Balance Sheet INR Mn High level of liquidity to protect the balance Balance Sheet Mar’23 Jun’23 Sep’23 sheet from any exogenous shocks. Low debt equity levels at 2.0x Financials Assets 6,300 6,031 6,540 Cash and Investments 1,183 865 867 Gross Loans 4,200 4,388 4,728 Less: Impairment Loss Allowance
Slide 59: Thank You
Thank You