Arman Financial Services Limited · NSE:ARMANFIN
Arman Financial Services — Q3 FY2025 Earnings Presentation
41 slides from Arman Financial Services's earnings presentation, February 2025
Slide 1: Arman Financial Services Limited Investor Presentation
Arman Financial Services Limited Investor Presentation – February 2025
Slide 2: Safe Harbour
Safe Harbour This presentation and the accompanying slides (the “Presentation”), which have been prepared by Arman Financial Services Ltd. (the “Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for an
Slide 3: Contents
Contents Business Update Page 4 - Page 7 About the Company Page 8 - Page 14 Presence in Attractive Retail Page 15 - Page 22 Lending Segments Efficient Liability Management Page 23 - Page 26 Strong Financial Performance Page 27 - Page 40
Slide 4: Business Update
Business Update Business Update
Slide 5: 9M FY25 Performance Highlights
9M FY25 Performance Highlights Rating Upgraded to A | stable outlook by Acuite Ratings in August 2024 INR 2,280 Crore INR 175 Crore Assets Under Provisions Cumulative Provisions stood at INR 138.9 Crore as on 31st Management and Write offs December 2024 (-6.5% Y-o-Y) (covering 6.0% of the consolidat
Slide 6: Recent Fund Raises (1/2)
Recent Fund Raises (1/2) December – 2023 September - 2022 Company raised INR 230 crore via Shareholding Pattern as on 31 st Company raised INR 115 crore via allotment of CCDs December 24, on Fully diluted Qualified Institutional Placements of and OCRPS which got fully converted in March 2024 Busines
Slide 7: Recent Fund Raises (2/2)
Recent Fund Raises (2/2) Calculated as per IND-AS Net worth (INR Crore) Debt/Equity (x) # CRAR (%) 847 865 859 1.8 813 1.8 62.7% 1.5 1.4 48.2% 39.2% 43.8% 45.7% 37.9% 39.5% 32.8% Mar-24 Jun-24 Sep-24 Dec-24 Mar-24 Jun-24 Sep-24 Dec-24 Mar-24 Jun-24 Sep-24 Dec-24 Arman (Standalone) Namra #After adjus
Slide 8: About the Company
About the Company About the Company
Slide 9: About Arman Financial Services
About Arman Financial Services About the Company Business Performance Efficient Liability Management • A diversified NBFC focusing on large under-served rural & semi-urban • Consistent rating upgrades backed by strong financial & operating retail markets performance • Namra & Arman credit rating upg
Slide 10: Journey so Far
Journey so Far 1992 1995 1998 2010 2011 • Company Incorporated • Listing on BSE – • Launched 2W Loans • Launched Microfinance • Raised PE funding • Started bill discounting Issue subscribed business from Incofin & Machine leasing 22x • Disbursement crosses INR 50 Crore 2019 2018 2017 2014-16 2013 •
Slide 11: Geographical Footprint
Geographical Footprint Geographical AUM Mix Number of (Consolidated) 9MFY25 9MFY24 Branches 2% 2% Microfinance 392 315 9% 2% 2 1% 29% 12 5% MSME 90 75 93 56 11% 2W & Rural 2W 4 4 60 78 18 91 Total 486 394 16% 23% 45 23 Gujarat Maharashtra Jharkhand Uttar Pradesh Bihar Others 8 Madhya Pradesh Haryana
Slide 12: Strong Underwriting Measures by Leveraging Digital Transformation
Strong Underwriting Measures by Leveraging Digital Transformation Loan Management Instant Verification Of Key Details • Loan Utilization check • The LOS* & LMS* System facilitates instant • Instant pre-closure and pre-settlement and its verification simulation for the customer to understand • KYC Va
Slide 13: Eminent Board of Directors
Eminent Board of Directors Alok N. Prasad Jayendrabhai B. Patel Aalok J. Patel Chairman Vice Chairman & Managing Director Joint Managing Director • A veteran banker with over 35 years of regulatory, banking and • He has been an entrepreneur for 45 years. He was involved in a • He has 16 years of ban
Slide 14: Competitive Moat
Competitive Moat Focus on small ticket retail loans to the large under served informal segment customer in rural & semi urban geographies Diversifying products, geographies, sources of funds and delivering growth by increasing volumes rather than ticket sizes Competitive Conservative operations fram
Slide 15: Presence in Attractive Retail Lending Segments
Presence in Attractive Retail Lending Segments
Slide 16: Product Offerings across Verticals
Product Offerings across Verticals 77% 18.0% 3.6% Microfinance - JLG MSME Loans Two-Wheeler Loans Average Ticket Size : INR 47,000 Average Ticket Size: Average Ticket Size: (Cycle 1 & 2 -INR 25k - 60k INR 80,000 INR 74,000 Cycle 3+ -INR 25k – 75k) Tenur e: 18 -24 Mon th s Tenure: 24 Months Tenure: 1
Slide 17: Microfinance Loans
Microfinance Loans (INR Crore) AUM* Disbursement Total Income Profit After Tax Avg. Ticket Size (INR) 2,046 1,362 383 402 100 46,500 47,000 1,768 839 8 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 *Includes Individual Business Loans • Disbursement: 100% Cashless • JLG model
Slide 18: 2W and Rural 2W Loans
2W and Rural 2W Loans (INR Crore) AUM Disbursement Total Income Avg. Ticket Size (INR) 79 83 54 51 15 71,000 74,000 13 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 • Hypothecation (secured) loans given to self-employed /cash-salaried customer in the • Disbursement: 100% Cashless informal
Slide 19: LAP Loans
LAP Loans (INR Crore) AUM Disbursement Total Income Avg. Ticket Size (INR) 19 9 0.94 4,10,000 4,30,000 4 6 0.27 Q1FY25 Q3FY25 Q1FY25 Q3FY25 Q1FY25 Q3FY25 Q1FY25 Q3FY25 • Disbursement: 100% Cashless • Credit Checks: CIBIL & CRIF Score; Home & Business Field Investigation, • Company launched and pilot
Slide 20: MSME Loans
MSME Loans (INR Crore) AUM Disbursement Total Income Avg. Ticket Size (INR) 410 262 108 80,000 80,000 312 213 76 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 9MFY24 9MFY25 • Individual enterprise /working capital loans for small rural businesses in low competition • Disbursement: 100% Cashless areas •
Slide 21: MSME Process Overview
MSME Process Overview MSME Process Overview Sourcing Underwriting Collections • In-house sourcing team (No DSAs) • Credit bureau check (CRIF & CIBIL) • Team member that does sales also • handles collections • Feet-on-Street sales team model Physical FI & PD by in house credit manager at residence &
Slide 22: Collection Efficiency
Collection Efficiency Microfinance MSME Two-Wheeler Total 95.1% 94.9% 95.2% 95.4% 96.0% 96.2% 95.7% 95.8% 95.7% 95.1% 95.1% 95.3% Oct-24 Nov-24 Dec-24 Oct-24 Nov-24 Dec-24 Oct-24 Nov-24 Dec-24 Oct-24 Nov-24 Dec-24 Two- Update on Collections Particulars (INR Crore) Microfinance MSME Wheeler Total • T
Slide 23: Efficient Liability Management
Efficient Liability Management
Slide 24: Strong Capitalization with Sufficient Liquidity
Strong Capitalization with Sufficient Liquidity Capital Adequacy Ratio ALM Position (in Months) 62.7% 19 19 19 19 17 17 17 16 16 15 43.8% 45.7% 39.2% 39.5% 32.6% 32.8% 25.6% 31-Mar-23 31-Mar-24 30-Sep-24 31-Dec-24 Q3 FY 2 4 Q4 FY 2 4 Q1 FY 2 5 Q2 FY 2 5 Q 3 FY 2 5 Arman (Standalone) Namra Av g T enu
Slide 25: Borrowing Profile
Borrowing Profile Borrowing Mix (%) Top 5 Lending Partners (INR Crore) 2,240 2,261 2,217 2,019 1,765 Top 5 Lenders % of Borrowings Lender 1 - TL & DA 12.94% 35.7% 35.9% 33.9% Lender 2 - DA 9.07% 41.1% 40.2% Lender 3 - TL & DA 5.55% 3.2% 4.3% 4.4% Lender 4 - NCD 5.05% 5.1% 4.6% 11.8% 12.3% 19.7% Lend
Slide 26: Securitization
Borrowings Bank Borrowings Non-Bank Securitization Lending Partnerships NCDs & ECB Partners The Brand Names mentioned are the property of their respective owners and are used here for identification purposes only 26
Slide 27: Financial Performance
Financial Performance
Slide 28: 9M FY25 Consolidated Profit & Loss Statement
9M FY25 Consolidated Profit & Loss Statement Particulars (INR Crore) Q3 FY25 Q3 FY24 YoY % Q2 FY25 QoQ% 9M FY25 9M FY24 YoY % Income from Operations 164.8 168.8 181.5 530.7 478.6 Other Income 0.0 0.0 0.0 0.0 0 Gross Total Income 164.8 168.8 -2% 181.5 -9% 530.7 478.6 11% Finance Costs 57.0 71.2 65.3
Slide 29: Balance Sheet – 31st December 2024
Balance Sheet – 31st December 2024 Particulars (INR Crore) Consolidated Standalone Particulars (INR Crore) Consolidated Standalone ASSETS Dec-24 Mar-24 Dec-24 Mar-24 LIABILITIES & EQUITY Dec-24 Mar-24 Dec-24 Mar-24 Financial Assets Equity Share capital 10.5 10.5 10.5 10.5 Cash and cash equivalents 6
Slide 30: Consolidated Business Performance
Consolidated Business Performance (INR Crore) AUM Disbursement Gross Total Income 2,639 2,594 669 183 184 181 2,437 2,465 169 165 2,280 561 459 373 338 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Net Total Income Pre-provision Operating Pr
Slide 31: Consolidated Business Performance
Consolidated Business Performance Net Interest Margin (%) Cost to Income Ratio (%) Yield (%) 15.5% 35.9% 25.1% 25.1% 25.4% 25.4% 24.8% 15.2% 15.1% 15.2% 33.3% 13.1% 28.7% 25.7% 26.6% Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Asset Qualit
Slide 32: PAR Movement
PAR Movement PAR 31-90 (%) Movement GNPA (%) 8.3% 7.9% 6.9% 6.0% 7.8% 3.7% 4.4% 4.0% 4.1% 4.4% 3.7% 2.4% 3.4% 7.1% 2.8% 2.9% 2.2% 4.6% Mar-21 Mar-22 Mar-23 Mar-24 Dec-24 4.8% 3.9% 4.4% 4.3% 4.5% NNPA (%) 4.7% 2.3% 2.1% 1.9% 1.4% 2.1% 1.1% 1.6% 1.5% 0.3% 1.1% 1.9% 0.5% 0.7% 0.9% Mar-21 Mar-22 Mar-23
Slide 33: 9M FY25 – Standalone P&L Statement (2W, MSME & LAP)
9M FY25 – Standalone P&L Statement (2W, MSME & LAP ) Particulars (INR Crore) Q3 FY25 Q3 FY24 YoY % Q2 FY25 QoQ% 9M FY25 9M FY24 YoY % • Standalone AUM stood at ~INR 512 as on 31st December 2024 Income from Operations 45.0 32.6 44.1 131.3 95.8 • Disbursement of ~INR 124 Crore in Q3FY25; of Other Inco
Slide 34: Standalone Business Performance
Standalone Business Performance (INR Crore) AUM Disbursement Gross Total Income* 494 512 137 42.3 43.3 448 471 125 39.2 83 15 5.2 5.0 391 82 85 106 109 34.1 79 101 25 31.4 4.7 79 14 18 4.4 23 4.5 398 410 120 36.6 37.3 367 383 89 91 34.2 312 86 29.7 79 26.9 2 6 11 19 2 4 5 9 0.6 0.9 0.3 Q3FY24 Q4FY24
Slide 35: 9M FY25 - Namra Finance Profit & Loss Statement
9M FY25 - Namra Finance Profit & Loss Statement • Over the years we have steadily expanded and Particulars (INR Crore) Q3 FY25 Q3 FY24 YoY % Q2 FY25 QoQ% 9M FY25 9M FY24 YoY % deepened our MFI presence through our wholly owned subsidiary, Namra Finance. This Income from Operations 120.9 136.2 138.0
Slide 36: Microfinance Business Performance – Namra Finance (1/2)
Microfinance Business Performance – Namra Finance (1/2) (INR Crore) AUM Disbursement Gross Total Income 2,193 2,129 534 147 143 2,046 1,981 136 138 459 121 1,768 356 269 214 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Net Total Income Pre-
Slide 37: Microfinance Business Performance – Namra Finance (2/2)
Microfinance Business Performance – Namra Finance (2/2) Net Interest Margin (%) Cost to Income Ratio (%) Yield (%) 13.6% 13.0% 35.8% 23.8% 23.8% 23.6% 23.0% 12.0% 12.5% 22.1% 11.9% 31.2% 26.2% 21.5% 23.0% Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY25 Q3FY25 Q3FY24 Q4FY24 Q1FY25 Q2FY
Slide 38: AUM and Disbursements Trends
AUM and Disbursements Trends Total AUM (INR Crore) Total Disbursements (INR Crore) 2,639 2,297 14% 3% 14% 1,943 1,767 3% 13% 13% 3% 3% 1,233 1,024 13% 83% 880 860 4% 778 14% 82% 814 16% 4% 685 17% 84% 12% 84% 11% 15% 6% 547 12% 10% 509 453 14% 10% 15% 83% 17% 13% 5% 10% 248 0% 248 3% 82% 172 204 20%
Slide 39: Historical Metrics
Historical Metrics Gross and Net Total Income Yield & NIM (%) Asset Quality (INR Crore) Demonetization COVID-19 Demonetization COVID-19 Demonetization COVID-19 662 6.7% 28.7% 28.3% 27.4% 25.5% 26.7% 24.4% 25.2% 21.5% 22.9% 424 396 17.4% 16.5% 16.5% 15.9% 14.0% 14.3% 14.2% 13.8% 2.6% 2.6% 4.6% 3.3% 2
Slide 40: Annexure
Annexure • Gross Interest Income = Interest Income + processing fees / other charges • Net Interest Margins = Net Interest Income / Average AUM (On + Off -Book) • Yields = Gross Interest Income / Avg. AUM (On + Off Off -Book) • Cost-to -Income Ratio = Opex (excl. provisions) / Net Total Income • GNP
Slide 41: Thank You
Thank You Contact Information Company: Investor Relations Advisors: Arman Financial Services Limited Strategic Growth Advisors Pvt. Ltd. CIN: L55910GJ1992PLC018623 CIN: U74140MH2010PTC204285 Mr. Vivek Modi Mr. Abhishek Shah Chief Financial Officer (CFO) abhishek.shah@sgapl.net Email : vivek@armanind
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