Care Ratings Ltd · NSE:CARERATING
Care Ratings — FY2019 Earnings Presentation
27 slides from Care Ratings's earnings presentation, May 21, 2019
Slide 1: Cover letter to stock exchanges
~@Ratings Profo,,sional Risk Opi nion Date: May 21, 2019 SE/ 2019-20/013 To, The National Stock Exchange India Ltd . The General Manager Listing Department The Corporate Relation Department Exchange Plaza ase Limited Bandra Kurla Complex Phlroza Jeejeebhoy Towers Bandra {Ea~t) 14"' Floor, Dalal Stre
Slide 2: FY19 Results press release
~ ~ Ra tings Professional Risk Opinion th Registered office: 4 Floor, Godrej Coliseum, Somaiya Hospital Road, Off Eastern Express Highway, Sion (East), Mumbai 400 022 CIN: L67190MH1993PLC071691 st Mumbai, 21 May, 2019 FY19 Results The Board of Directors of CARE Ratings approved the quarter ended Mar
Slide 3: Operational data and economic backdrop
~ ~ Ra tings Professional Risk Opinion Operational Data For the year ended March 31, 2019, your company has rated total debt amounting to Rs.19.91 lakh crore compared with Rs.16.48 lakh crore in the previous financial year ended March 31, 2018. This comprises of Rs.8.13 lakh crore in bonds, Rs.8.50
Slide 4: Subsidiaries and branches
~~Ratings Professio nal Risk Opinio n The company has a subsidiary CARE (Ratings) Africa Private Limited (CRAF) in Mauritius and CARE Ratings Nepal Limited in Nepal. The company has two wholly owned subsidiaries in Mumbai, India namely CARE Risk Solutions Private Limited and CARE Advisory Research &
Slide 5: CARE Ratings Limited – FY19
CARE Ratings Limited Investor Presentation – FY19
Slide 6: Safe Harbor Statement
SAFE HARBOR STATEMENT THIS PRESENTATION AND THE ACCOMPANYING SLIDES (THE “PRESENTATION”), WHICH HAVE BEEN PREPARED BY CREDIT ANALYSIS & RESEARCH LIMITED (THE “COMPANY”), HAVE BEEN PREPARED SOLELY FOR INFORMATION PURPOSES AND DO NOT CONSTITUTE ANY OFFER, RECOMMENDATION OR INVITATION TO PURCHASE OR SU
Slide 7: CARE Ratings Group
CARE Ratings Group CARE Ratings Limited CARE Risk CARE Advisory CARE Ratings CARE Ratings Solutions Research and (Africa) (Nepal) Private Training Private Limited, 51% Limited,100% Limited, 100% Limited, 78% Investors Presentation FY19 3
Slide 8: Diversified Business Mix
Diversified Business Mix Ratings Information Analysis & Grading Manufacturing & Services sector Industry & Customized Research reports Financial sector CARE Industry Risk Metrics (CIRM) reports Infrastructure Grading services Small & Medium Enterprises Training Structured Finance
Slide 9: Experienced & Professional Management
Experienced & Professional Management Rajesh Mokashi – MD & CEO Over 32 years of experience in finance, commerce and credit risk sectors Before joining CARE, worked for Otis Elevator Company India, DSP Financial Consultants & Kotak Mahindra Finance Holds Master of Management Studies degree Q
Slide 10: Experienced & Professional Management
Experienced & Professional Management Milind Gadkari Swati Agarwal Jain Revati Kasture Sanjay Kumar Agarwal Amod Khanorkar Senior Director, Senior Director, Senior Director, Senior Director, Senior Director, Ratings Ratings Ratings Ratings Business Development 17 years of experience in 22 years
Slide 11: Shareholding Snapshot as on March 31, 2019
Shareholding Snapshot as on March 31, 2019 100% Public Shareholding‐ Professionally Managed Names of Top 20 Shareholders Holding % LIFE INSURANCE CORPORATION OF INDIA+ LIC P & GS FUND 9.85 CRISIL LIMITED 8.90 0.07% 0.23% FRANKLIN TEMPLETON INVESTMENT FUNDS+FRANKLIN INDIA SMALLER COMPANIES FUND 7.59
Slide 12: Highlights: FY19 (adjusted)
Highlights: FY19(adjusted*) Standalone Consolidated Particulars FY19 FY19 Performance during the Period Total Income ‐0.03% 3.19% Revenue From Operations* ‐1.5% 1.9% Operating Profit (Without ESOP) ‐7.5% ‐6.4% Operating Profit (With ESOP) ‐10.0% ‐8.9% Other Income 18.1% 19.3% Profit Before Tax (with
Slide 13: Financial Performance (adjusted)
Financial Performance(adjusted*) Rs. Lakhs Standalone Consolidated % Change % Change Particulars FY19 FY18 FY19 FY18 Revenue from Operations* 29,736 30,203 ‐1.5% 31,897 31,310 1.9% Total Expenses 11,641 10,648 9.3% 13,490 11,642 15.9% Operating Profit (without ESOP) 18,095 19,555 ‐7.5% 18,407 19,668
Slide 14: Financial Performance: FY19 Standalone (adjusted)
Financial Performance:FY19 (Rs cr)‐Standalone (adjusted*) Operating Profit Margin (%)(with ESOP) PAT Margin (%) 61.88% 62% 46% 45.04% 45% 59% 44% 56.57% 43% 56% 42% 41.26% 53% 41% 40% 50% 39% FY18 FY19 FY18 FY19 Towards the end of the second quarter of FY19 the NBFC sector faced headwinds which impa
Slide 15: Financial Performance – without adjustment
Financial Performance – without adjustment Rs. Lakhs Standalone Consolidated % Change % Change Particulars FY19 FY18 FY19 FY18 Revenue from Operations 29,736 32,161 ‐7.54% 31,897 33,268 ‐4.12% Total Expenses 11,641 10,648 9.33% 13,490 11,642 15.87% Operating Profit (without ESOP) 18,095 21,513 ‐15.8
Slide 16: Business Performance: FY19
Business Performance: FY19 25.0 Volume of Debt Rated (Rs lk cr) 12000 No of Instruments Rated 10,243 19.91 10000 20.0 9,380 8,088 16.48 8,090 8000 15.0 6000 10.0 8.13 8.50 6.54 6.38 4000 5.0 3.56 3.27 1,632 2000 110 365338 844 156 0.0 0 Short & Long termBank Loan Total Short & Long Bank Others Total
Slide 17: Rating Movement
Rating Movement There has been a moderation in credit quality of entities rated by CARE Ratings in 2018‐19. The credit quality as measured by CARE Ratings ‘modified credit ratio’ (MCR), for 2018‐19 came in at 0.95 compared with the ratio of 1.08 in 2017‐18. The softening in overall credit quality in
Slide 18: CARE Ratings Debt Quality Index (CDQI)
CARE Ratings Debt Quality Index (CDQI) - CDQI showed an improving trend during the first five months of FY19. However, it fell marginally in the months of September and October’18 and remained more or less stable in the months of November’18 – February’2019. It, thereafter, increased in the month of
Slide 19: Economic Backdrop
Economic Backdrop 5 IIP GDP growth (%) 4.4 9.0 7.7 8.0 4 8.0 3.6 7.0 7.0 7.0 6.6 6.3 6.0 5.6 3 5.0 % 4.0 2 3.0 2.0 1 1.0 0.0 0 FY18 FY19 CSO has estimated 7% growth for FY19 We are expecting 6.9% for the fiscal year Investors Presentation FY19 15
Slide 20: Economic Backdrop
Economic Backdrop 7.0 Rs/$ Inflation May‐18 Mar‐19 Nov‐18 Aug‐18 Dec‐18 Sep‐18 Feb‐19 Apr‐18 Oct‐18 5.8 Jun‐18 Jan‐19 Jul‐18 6.0 5.5 5.1 5.2 4.9 5.0 4.5 4.6 60.00 5.0 3.8 62.00 4.0 4.5 4.4 3.1 4.2 3.2 % 64.00 3.7 3.8 2.8 2.9 3.0 3.42.3 66.00 2.2 2.9 2.0 2.6 68.00 2.0 69.52 1.0 70.00 0.0 72.00 71.26
Slide 21: Economic Backdrop
Economic Backdrop Growth in Bank credit 14.0 13.2 12.0 10.0 10.0 8.0 % 6.0 4.0 2.0 0.0 FY18 FY19 Investors Presentation FY19
Slide 22: Economic Backdrop
Economic Backdrop Growth in Sectoral Credit CP Issuances 20.0 17.8 17.8 30.0 18.0 16.4 25.96 16.0 13.8 25.0 22.90 14.0 12.0 20.0 Rs. Lkah crore % 10.0 8.0 7.9 6.9 15.0 6.0 3.8 4.0 0.7 10.0 2.0 0.0 4.80 5.0 3.70 Agriculture Industry Services Retail 0.0 FY18 FY19 FY18 FY19 Oustanding CPs Issuances Mfg
Slide 23: Economic Backdrop
Economic Backdrop 700,000 Corporate Debt Raised (Rs cr) 644,033 600,000 610,318 604,100 599,147 500,000 400,000 300,000 200,000 33,716 4,953 100,000 ‐ Public Issue Private Placement Total ■ FY18 ■ FY19 Investors Presentation FY19
Slide 24: Economic Backdrop
Economic Backdrop 12.00 Repo Rate (%) & MCLR(%) 8.50 G Sec Yield (%) 11.00 8.00 10.00 9.00 7.36 7.39 8.28 7.50 % 8.00 % 7.00 7.00 6.00 6.00 6.50 5.00 4.00 6.00 Aug‐18 Nov‐18 Dec‐18 Aug‐18 Nov‐18 Dec‐18 Jun‐18 Jun‐18 Apr‐18 May‐18 Oct‐18 Jul‐18 Sep‐18 Jan‐19 Mar‐19 Apr‐19 Apr‐18 May‐18 Oct‐18 Feb‐19
Slide 25: Economy Overview
Economy Overview Positives Negatives • Easing inflation • Subdued economic growth • Increasing bank credit off • Decline in debt issuances take • Subdued industrial output • Commercial Paper issuances • Stagnant core sector growth rose • Fall in interest rates • Strengthening Rupee Investors Present
Slide 26: Economic Outlook for FY20
Economic Outlook for FY20 • GDP growth is expected to be around 6.9% in FY19 and 7.1% in FY20 • Inflation expected to be around 4‐4.5% in FY20 contingent upon global crude oil prices • Exchange rate of Rupee to depreciate by 3.5‐4% during the year assuming crude oil prices to remain stiff • RBI is e
Slide 27: Thank You
Thank You Investors Presentation FY19 23