Axis Bank Limited · NSE:AXISBANK
Axis Bank — Investor Presentation (June 2021)
52 slides from Axis Bank's investor presentation, June 2021
Slide 1: One Axis - Significant value creation in key subsidiaries
“One Axis” - Significant value creation in key subsidiaries Presentation - June 2021 1
Slide 2: One Axis enables us to offer various products and services
One Axis enables us to offer various products and services of the Bank and its subsidiaries… “One Axis” essentially means experiencing Axis Franchise as “ONE” Investment Banking / Capital Markets 1 • Debt Capital Markets (DCM) Wholesale Banking • Equity Capital Markets (ECM) • M&A & Advisory • Forex
Slide 3: Creating value for shareholders across the Bank and its group entities
… creating value for its shareholders across the Bank and its group entities All figures in ` Crores Invst Banking Consumer Retail Fintech Asset Management Trustee TReDS platform Insurance & Inst Equities focused NBFC Brokerage platform One of the fastest Leadership position in AAA rated NBFC with 3
Slide 4: Axis Asset Management Company Limited
1 Axis Asset Management Company Limited 2 Axis Capital Limited 3 Axis Finance Limited 4 Axis Securities Limited 5 Other Subsidiaries / Group Companies 4
Slide 5: Axis AMC at a glance
Axis AMC at a glance `1.96 Tn | 36% 8 mn | 33% 104 Axis AMC Quarterly AAUM CAGR* Client folios YoY growth Branches 6% | 11% 10% | 17% 89% Market Share Overall market Incremental Equity market Incremental Share of individual investors** in share (QAAUM) market share share (QAAUM) market share growth
Slide 6: Key differentiators
Key differentiators Unique, differentiated investment process that focuses on high quality portfolios Robust long term performance track record Capabilities across equity (listed/ unlisted), debt and real estate Continued product innovation including Global, Alternatives and ETF strategies Significa
Slide 7: We have significantly lifted the growth trajectory in the last 2 years
We have significantly lifted the growth trajectory in the last 2 years… • Our average incremental market share in Overall QAAUM has been ~2x of our closing market share • Equity & Hybrid funds AAUM constitute 54% of our overall AAUM, compared to 42% for the industry All figures in ` bn Overall QAAUM
Slide 8: With strong traction in customers and SIP folios
…with strong traction in customers and SIP folios Folio Count & market share SIP Count 120 11.00% 100 2 yr CAGR of 44% 2 yr CAGR of 64% 8.2% 9.00% 5 yr CAGR of 37% 5 yr CAGR of 48% 40 6.7% 80.11 7.00% 80 35 32.74 4.7% 3.9% 4.0% 5.00% 30 3.5% 60.11 60 3.00% 25 21.49 38.89 20 40 1.00% 28.23 15 12.20 2
Slide 9: Strong growth led by our strategic imperatives
We have delivered strong growth in last 2 years led by our strategic imperatives 1 We have strengthened product proposition with new launches 2 We have made investments in expanding our distribution reach 3 We are also rapidly enhancing digital assets and presence 9
Slide 10: We have strengthened product proposition with new launches
1 We have strengthened product proposition with new launches Mutual Funds Alternatives • Axis Retirement Savings Fund: • Portfolio Managed Services - Provides long term retirement solution with a special Insurance bundle for SIP investors(iPlus SIP) - Launched the Axis Core & Satellite PMS, a multi-
Slide 11: Investments in expanding our distribution reach
2 We have made investments in expanding our distribution reach • Expanded our geographical reach with well diversified AAUM base across regions and cities • 40% of AAUM sourcing is through direct channels, with 89% of Equity AAUM contribution from Individual Investors 18% of AAUM is from B30 locatio
Slide 12: Rapidly enhancing digital assets and presence
3 We are also rapidly enhancing digital assets and presence Initiatives taken Outcomes • Leading AMC in terms of Gross sales in Industry for VRM1 model space • 6x YOY growth in VRM Agents from Mar 20 VRM - B2C • WFH solutions built to deliver productivity seamlessly even during COVID • ~500% increas
Slide 13: Strong financial performance, PAT up 100% YoY
Strong financial performance, PAT up 100% YoY Total Income Operating Profit 88% YOY 685 324 643 35% YOY 478 173 85 FY19 FY20 FY21 FY19 FY20 FY21 Profit after tax Return On Equity 44% 242 100% YOY 33% 121 19% 55 FY19 FY20 FY21 FY19 FY20 FY21 All numbers reported above are as per IGAAP 13
Slide 14: Product labelling details of schemes & risk factors
Product labelling details of schemes & risk factors Scheme Name & Type of the scheme Product Labelling Riskometer(s) This product is suitable for investors who are seeking -- Axis All Seasons Debt Fund of Funds (An open ended fund of funds scheme investing in debt oriented mutual fund schemes) · To
Slide 15: Product labelling details of schemes & risk factors
Product labelling details of schemes & risk factors Scheme Name & Type of the scheme Product Labelling Riskometer(s) This product is suitable for investors who are seeking - Axis Retirement Savings Fund - Dynamic Plan · Capital appreciation and income generation over long term. (An open-ended retire
Slide 16: Disclosure of Average AUM in regulatory format for period ended Mar'21
Disclosure of Average AUM in regulatory format for period ended Mar’21 • Disclosure: Scheme AUM/AAUM (Amt in cr) Rs.191919.66 / Rs. 196548.66 Asset Classwise AUM / AAUM: Liquid/Money Market: 29244.91/33687.69, Gilt: 162.39/ 181.70 Income/Debt: 50769.68 / 53978.42 Equity including ELSS: 100105.80 /97
Slide 17: Axis Capital Limited
1 Axis Asset Management Company Limited 2 Axis Capital Limited 3 Axis Finance Limited 4 Axis Securities Limited 5 Other Subsidiaries / Group Companies 17
Slide 18: Axis Capital at a glance
Axis Capital at a glance No. 1* | ` 3.9 Tn No. 4^ ~50% Axis Capital ECM house, executed equity Merger & Advisory business Deals as left lead banker since deals since Jan 2015* (in FY21) Jan 15 13.7% 2.90% 2.1% Market Share Revenue market share in Incremental market share gained in Market share in In
Slide 19: Key differentiators
Key differentiators Experienced management team with seamless and unparalleled execution capabilities Strong relationships built with key investors across geographies, over last two decades Ability to provide holistic solutions to corporates leveraging on ‘One Axis’ capabilities Robust distribution
Slide 20: Consistent recognition as one of India's best Investment Bank
Consistent recognition as one of India’s best Investment Bank Highest ever number of ECM deals in FY21 5 years (since April 2016) Among the top players in Advisory ECM Deal * Count Ranking^ Deal Count Amount Advisory Deal ^ Count Ranking^ (INR bn) 115 3,648 FY21 4 8 4 FY21 52 Peer 1 106 3,286 9 FY20
Slide 21: We have further strengthened our Institutional Equities business
We have further strengthened our Institutional Equities business People Products Processes • Recent key talent additions at leadership level • Revamped our Research products, moving away • Invested in further improving our trading room • Co-Heads of Equities from maintenance to thematic and differen
Slide 22: Strong financial performance, PAT up 66% YoY
Strong financial performance, PAT up 66% YoY Breakup of Revenue from operations Revenue from Operations 381 35% 58% YOY 48% 45% 241 214 65% 52% 55% FY19 FY20 FY21 FY19 FY20 FY21 Institutional Equities Investment Banking Profit after tax Return On Equity 166 36% 66% YOY 27% 950 bps YOY 100 64 16% FY1
Slide 23: Axis Finance Limited
1 Axis Asset Management Company Limited 2 Axis Capital Limited 3 Axis Finance Limited 4 Axis Securities Limited 5 Other Subsidiaries / Group Companies 23
Slide 24: Axis Finance at a glance
Axis Finance at a glance 11,089 Cr 20.4% AAA 14.6% Axis Finance Assets under management Capital Adequacy Highest Credit Return on equity Ratio Rating 26% 42% 22% 7.5 times Growth CAGR* YoY Growth of Growth in Wholesale book | Growth in Retail book Overall Book overall book (YoY) (YoY) 15% | 11% `211
Slide 25: Key differentiators
Key differentiators Unique positioning as a Bank promoted, AAA rated diversified NBFC Complimentary product offerings and customer segments to that of Axis Bank Ability to provide holistic solutions leveraging ‘One Axis’ capabilities of Axis Group Strong operational and risk management backed by rob
Slide 26: Increasing diversification with granular retail portfolio build
Increasing diversification with granular retail portfolio build All figures in ` Crores Retail book now accounts for 17% of our overall book, entirely A built over the last two years 11,089 1880 1%5% 7% 17% LAP 8% Personal loans Housing loan 8,140 FY21 Business loan 10 7,816 58% Consumer Finance 21%
Slide 27: Retail book now accounts for 17% of overall book
A Retail book now accounts for 17% of our overall book, entirely built over the last two years • Started mass retail business in Q2FY20 and delivered strong growth in last 6 quarters • Of the total disbursements, Retail segment contributed ~ 23% in FY21 All figures in ` Crores Registered strong grow
Slide 28: Consistent de-risking of Wholesale book
B Consistent de-risking of Wholesale book through increasing focus towards better rated corporates and cash flow backed collateralised loans • 88% of disbursements in corporate book to A- and better rated corporates and cash flow backed businesses • Over 13x rise in collaterised loans while simultan
Slide 29: Well diversified liability mix with best-in-class funding cost
Well diversified liability mix with best-in-class funding cost among NBFCs Diversified funding mix 26% 28% 38% 1• 71% share of long term funding instruments as of Mar-21 FY20 up from 44% in Mar-20 FY21 1% 59% 12% 30% 6% 2• 76% funding from non Axis Bank sources ensuring deeper and wider funding acce
Slide 30: Our Strategy and focus areas
Our Strategy and focus areas 1 Continued focus on growing retail book by sharpening the product mix and deepening distribution 2 Focus on growing whole sale book sustainably while increasing granularity 3 Investments in technology to create a fully Integrated Retail Loan System 4 Technology and proc
Slide 31: Continued focus on growing retail book
1 Continued focus on growing retail book by sharpening the product mix and deepening distribution Focused Product Mix Alternate Distribution Increased Branch footprint Emphasis on growing secured book Extended distribution through Expand physical branch presence online partners & aggregators in Tier
Slide 32: Focus on growing wholesale book sustainably
2 Focus on growing whole sale book sustainably while increasing granularity Corporate Lending Collateralised Loans Emerging Corporate Lending Real Estate Continue to focus on well-rated Adapt a cluster-based approach Small ticket size loans to aid Focus on top developers in firms with strong cash-fl
Slide 33: Investments in technology to create Integrated Retail Loan System
3 Investments in technology to create a fully Integrated Retail Loan System Integrations Core System Architecture User Interface NSDL (PAN Check) Bureau (Consumer & Commercial) KYC validations Collection LOS (API integrations) (DPD, NPA, (Loan origination) Follow-up) SMS/Email Gateway Web Mobile Cor
Slide 34: Technology and process automation driving operational efficiencies
4 Technology and process automation initiatives driving operational efficiencies… Initiatives taken Pilot outcomes • Sales team enabled with BYOD • 50% reduction in application login time through Mobile app Sales processes • Common LAF* & OCR based reduced data entry • 30% reduction in FTNRs on logi
Slide 35: Helping enhance customer experience and overall productivity
4 … helping enhance customer experience and overall productivity Initiatives taken Pilot outcomes • Online loan application status tracking • Enhanced customer experience Customers • Welcome letter in 48 hours on Whatsapp • 15 days faster issuance of welcome letter as compared to some of the peers •
Slide 36: Delivering consistently strong financial performance
Delivering consistently strong financial performance despite ongoing investments for building out Retail business Total Income Net Interest Margin Capital Adequacy ratio 4% YOY 5.4% 23.1% 1,023 4.9% 22.0% 984 4.4% 20.4% 911 FY19 FY20 FY21 FY19 FY20 FY21 FY19 FY20 FY21 Profit after tax Asset Quality
Slide 37: Axis Securities Limited
1 Axis Asset Management Company Limited 2 Axis Capital Limited 3 Axis Finance Limited 4 Axis Securities Limited 5 Other Subsidiaries / Group Companies 37
Slide 38: Axis Securities at a glance
Axis Securities at a glance 3.6+ mn1 1,200+ 30+ 100+ Axis Securities Customer base - 3rd largest Employees Advisory branches Business Partners & Bank-led broker & CDD^ desks Tie up with 4 Indian Banks 43% 2.90% 1.69% Market Share Cash delivery volume Online cash market share Cash market share 41% `1
Slide 39: Key differentiators
Key differentiators Full service retail brokerage with focus on quality customer acquisitions and profitability Robust technology infrastructure and digital capabilities Ability to provide holistic solutions to retail clients leveraging on ‘One Axis’ capabilities Extensive distribution reach using o
Slide 40: We are the 3rd largest bank led retail brokerage firm
We are the 3rd largest bank led retail brokerage firm • A full service retail brokerage firm with focus on cash delivery volumes to drive profitable growth • 43% average daily cash delivery volumes, higher than market cash delivery volumes of 31% Customer Base Average daily cash value Average daily
Slide 41: Medium term strategic objectives to drive profitable growth
We continue to deliver on our medium term strategic objectives to drive profitable growth 1 Focused Business model with improving quality of acquisitions 2 Strengthened investment suite by introducing innovative products to build captive AUM 3 Continue to leverage on our strong Digital offerings 41
Slide 42: Focused business model with improving quality of acquisitions
1 Focused Business model with improving quality of acquisitions • Took significant steps towards becoming a full service Retail brokerage firm in last two years by moving away from Retail Assets business and migrating away from discount brokerage model • Focus has been to improve the quality of new
Slide 43: Strengthened investment suite to build captive AUM
2 Strengthened investment suite by introducing innovative products to build captive AUM • Focus has been to build captive AUM business through robust research engine and product offerings to reduce volatility • We have 10+ innovative product offerings across equities, commodities and advisory to sca
Slide 44: We continue to leverage on our strong Digital offerings
3 We continue to leverage on our strong Digital offerings • Digital contributes 89% of volumes and 66% of revenues, focus is on driving growth through technology led innovation across our digital platforms • Convenient digital account opening process and launch of new RING Technology trading platfor
Slide 45: Delivered strong performance with 10x growth in PAT
Delivered strong performance with 10x growth in PAT All figures in ` Cr Total revenue mix (by segments) Cost to income ratio (Broking) 219 424 94% YOY 74% 1,085 64% 13% 50% 1400 bps 81% YOY 100% 87% 19% FY19 FY20 FY21 FY19 FY20 FY21 Non Broking Broking Profit after tax Return On Equity 166 3600 bps
Slide 46: Other Subsidiaries / Group Companies
1 Axis Asset Management Company Limited 2 Axis Capital Limited 3 Axis Finance Limited 4 Axis Securities Limited 5 Other Subsidiaries / Group Companies 46
Slide 47: Axis Trustee
• Axis Trustee is amongst the leading Trustees with strong expertise in innovative investment vehicles like REITs and InvITs • Registered with SEBI, ATSL provides trusteeship, agency & administration services since the year 1999 • Experienced team with strong domain expertise has helped ATSL to regi
Slide 48: Freecharge
Freecharge has evolved from a pure payments platform to a broader fintech platform Freecharge serves as a “Digital Acquisition Engine” for the Bank to onboard the young digitally native and SMBs* It has co-created financial product offerings across deposits, loans, cards, investments and payments Ke
Slide 49: A.TReDS continues to provide a strong platform for MSMEs
A.TReDS continues to provide a strong platform for MSMEs to source funding A. TReDS is one of the three entities allowed by RBI to set up an electronic Trade Receivables Discounting System platform to serve funding needs of MSMEs. ‘Invoicemart’, our digital invoice discounting platform continues to
Slide 50: Max Life - 4th largest private life insurer in India
Max Life – 4th largest* private life insurer in India ▪ Axis Bank completed the stake acquisition in India’s 4th largest* private life insurance company in Apr’21 to become a co-Promoter. ▪ This strategic partnership would further strengthen and deepen our relationship leading to better integration
Slide 51: In conclusion, progress in our One Axis journey
In conclusion, over the last two years we have made considerable progress in our One Axis journey with focus on delivering better value for customers across the Group An electronic invoice discounting Retail and Wholesale segments engage with platform for SME clients subsidiaries to offer ‘One Axis’
Slide 52: Thank You
Thank You A's BANK