Trucap Finance Limited · NSE:TRU
Trucap Finance — Dhanvarsha Finvest — Investor Presentation (November 2021)
43 slides from Trucap Finance's investor presentation, November 2021
Slide 1: Investor Presentation November 2021
Investor Presentation November 2021 1
Slide 2: Differentiated Lender Focused on The Mass Market Segment
Differentiated Lender Focused on The Mass Market Segment 1 Massive opportunity in an USD 7.3 Bn ~USD 12.0 Bn ~10.0% underserved market Potential MSME Lending Opp. Mass-market B2C loans Formal Gold lending penetration Curated product suite 2 addresses MSME white MSME business loans Gold loans Persona
Slide 3: Robust Business Model Based on 4Cs
Robust Business Model Based on 4Cs 4Cs That Define Dhanvarsha’s Business Credit Collections Capital Collaborations Product suite and Focus on Judicious Co-lending policies customized consistently high deployment of partnerships that & curated for the collection efficiency ` with capital help deliver
Slide 4: Key Metrics
Key Metrics ~USD 32 Mn ~USD 22 Mn ~USD 600 K Loan Book Net worth PBT for H1FY22 ~3x of PBT H1FY21 16 ~48.5% ~9.1% Marquee lenders Cost to income ratio Net interest margin G N 2.92% 1.38% ~1.1x Gross NPA% Net NPA% Debt to Equity Figures are for the 6 months ending 30 Sep 2021 (based on unaudited with
Slide 5: Dhanvarsha Is A Rapidly Growing Lending Business
Dhanvarsha Is A Rapidly Growing Lending Business No. of loans disbursed for the quarter 17,846 8,792 6,155 1,741 1,945 18 21 25 33 80 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 No. of borrowers No. of borrowers as at end of quarter 23,498 10,955 7,186 1,318 2,315 259 280 3
Slide 6: Dhanvarsha Is A Rapidly Growing Lending Business (Cont'd)
Dhanvarsha Is A Rapidly Growing Lending Business…(Cont’d) Loan Book (Amount in USD Mn) 32.0 17.8 13.9 10.2 8.1 5.4 5.0 4.8 5.0 5.7 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 Q4FY21 Q1FY22 Q2FY22 Disbursement (Amount in USD Mn) 20.0 5.6 5.8* 2.6 2.8 0.2 0.1 0.3 0.5 0.6 Q1FY20 Q2FY20 Q3FY20 Q4FY
Slide 7: Well Poised for Scale With Identified Drivers and Enablers
Well Poised for Scale With Identified Drivers and Enablers To Sustain Its Growth Trajectory Sustainable and profitable growth is catalyzed by a dynamic interaction between product, process and technology which is further enabled by an ecosystem of “Intra-preneurs” Board and Management: Lending-as-a-
Slide 8: Dhanvarsha Takes A Differentiated Approach To Lending
Products Distribution & Technology Capital Efficiency Risk Management Governance Dhanvarsha Takes A Differentiated Approach To Lending… Through its omnichannel distribution & tech platform coupled with capital efficient partnership model, Dhanvarsha’s products are targeted at the mass market segment
Slide 9: Curated Products Catering To The Unmet Demand For Credit: Gold loans
Products Distribution & Technology Capital Efficiency Risk Management Governance …With Curated Products Catering To The Unmet Demand For Credit Gold loans ■ Access to credit, especially for first time borrowers, marginalized communities, and women is limited ■ In these situations, customers often pa
Slide 10: Gold loans (Cont'd)
Products Distribution & Technology Capital Efficiency Risk Management Governance …With Curated Products Catering To The Unmet Demand For Credit (Cont’d) Gold loans (Cont’d) Gold constitutes ~35% of the portfolio as at 30 Sep 2021 but contributes to ~57% of disbursements during H1FY22 Loan Book Disbu
Slide 11: Business (MSME) loans
Products Distribution & Technology Capital Efficiency Risk Management Governance …With Curated Products Catering To The Unmet Demand For Credit (Cont’d) Business (MSME) loans Business loans ■ Dhanvarsha’s Atmanirbhar (self-reliant) Bharat Business loan aims to empower the MSMEs of India and nurture
Slide 12: Personal Loans
Products Distribution & Technology Capital Efficiency Risk Management Governance …With Curated Products Catering To The Unmet Demand For Credit (Cont’d) Personal Loans Personal loans ■ Through its own App/Web Interface and business correspondents Dhanvarsha offers quick, easy, and affordable persona
Slide 13: Loan Book of ~USD 32 Mn as at 30 Sep 2021
Products Distribution & Technology Capital Efficiency Risk Management Governance …With Curated Products Catering To The Unmet Demand For Credit (Cont’d) Loan Book of ~USD 32 Mn as at 30 Sep 2021 Loan Book that is diversified across MSME focused …straddling across products to maximize profitability s
Slide 14: Through an Omni-Channel Distribution Strategy
Products Distribution & Technology Capital Efficiency Risk Management Governance …Through an Omni-Channel Distribution Strategy Financial Technology Experiential Captive Sales Direct Selling Inclusion Assets Centres Team Agents Centres ■ Differentiated ■ Offers a superior ■ Dhanvarsha has a ■ Capex
Slide 15: Pioneering The Distribution Of Financial Products By Leveraging Robust Technology
Products Distribution & Technology Capital Efficiency Risk Management Governance Pioneering The Distribution Of Financial Products By Leveraging Robust Technology Money Rabbit® – an AI-powered proprietary credit health and financial Dhanvarsha Neo Bank will enable wellness platform that also enables
Slide 16: MoneyRabbit (1/3)
Products Distribution & Technology Capital Efficiency Risk Management Governance MoneyRabbit® (1/3) Dhanvarsha’s Omni Channel Digital Platform for MSME’s and Blue-Collar Work Force Credit Health Check Tool Virtual & Physical Card Retrieve latest Bureau Score Get your own Personalized Ru- and other c
Slide 17: Money Rabbit (2/3)
Products Distribution & Technology Capital Efficiency Risk Management Governance Money Rabbit® (2/3) Credit Health and Financial Wellness Tool Demystifying credit score for masses and in turn promoting financial literacy and inclusion ❖Financial Wellness and Credit Health platform for Dhanvarsha’s t
Slide 18: Money Rabbit (3/3)
Products Distribution & Technology Capital Efficiency Risk Management Governance Money Rabbit® (3/3) Proprietary AI Engine Powered Decision Making ❖Money Rabbit® uses its proprietary AI engine, AI-RITE™ which gathers real-time data & insights on the customers, thereby minimizing dependence on limite
Slide 19: Dhanvarsha Neo Bank
Products Distribution & Technology Capital Efficiency Risk Management Governance Dhanvarsha Neo Bank All your Banking needs ‘On the Go’ ❖ Unified Lending Platform − Personal Loans ❖ Savings Account − Business Loans − Zero Balance Savings − Gold Loans − Account opening − BNPL NEO Bank ❖ Investments ❖
Slide 20: Dhanvarsha Neo Bank (Cont'd)
Products Distribution & Technology Capital Efficiency Risk Management Governance Dhanvarsha Neo Bank (Cont’d) Neo Bank Architecture DFL NEO Bank Personal Loan Core System Lending Business Loan API Account opening Middle Ware API (LOMS) Dhanvarsha Current / Saving Ac Gold Loan Flow Based Lending Mode
Slide 21: DhanOne – Intelligent Lead Origination Platform
Products Distribution & Technology Capital Efficiency Risk Management Governance DhanOne – Intelligent Lead Origination Platform for Dhanvarsha and its Trusted Partners Loan for all segments: ■ Business Loans ■ Gold Loans ■ Personal Loans ■ Women Empowerment (Nari-Shakti) Loans Robust User Acquisiti
Slide 22: DhanSetu – Channel Partner App
Products Distribution & Technology Capital Efficiency Risk Management Governance DhanSetu – Channel Partner App Digital Platform for Dhanvarsha Partners to aid Seamless Customer Onboarding & Tracking Easy & Real Time Unlock Earnings: Tracking: Get a chance to unlock Track Total Loans additional earn
Slide 23: An Integrated LOS and LMS (LOMS)
Products Distribution & Technology Capital Efficiency Risk Management Governance An Integrated LOS and LMS (LOMS) Focusing on Automation A world class platform enabling seamless onboarding, underwriting, servicing, monitoring and on-time collections. CHANNELS Co-Lending Financial Digital Call Center
Slide 24: Products Are Distributed Across Key Markets In India
Products Distribution & Technology Capital Efficiency Risk Management Governance Products Are Distributed Across 8 Key Markets In India… ■ India’s overall gold financing penetration 9 NCR is ~10% with penetration in the western Haryana and northern states being even lower 1 1 Uttar Rajasthan Pradesh
Slide 25: Gold Loans: Experiential centres & Door-Step Disbursement
Products Distribution & Technology Capital Efficiency Risk Management Governance Gold Loans: Experiential centres & Door - Step Disbursement ■ The company through ‘experiential centers’ and digitally optimised ‘door-step disbursement’ offers a superior value proposition to customers in MSME gold fin
Slide 26: Financial Inclusion Stores – Distribution with Scale
Products Distribution & Technology Capital Efficiency Risk Management Governance Financial Inclusion Stores – Distribution with Scale Business and Personal Loans - Leveraging existing neighborhood stores and community centers to ease access to credit services Business Model: Key attractions of the f
Slide 27: Co-lending Partnerships – a Risk-Mitigating Strategy
Products Distribution & Technology Capital Efficiency Risk Management Governance Co-lending Partnerships – a Risk-Mitigating Strategy to Enhance Reach and Product Bouquet ■ Co-Lending partnerships with FLDG (first loss default guarantee) specifically in MSME, business and education loans. Personal ■
Slide 28: A Strong and Liquid Balance Sheet With Capital From Marquee Lenders
Products Distribution & Technology Capital Efficiency Risk Management Governance A Strong and Liquid Balance Sheet With Capital From Marquee Lenders Amounts in USD Mn Borrowings from Banks & FIs 17.6 NCD & other debentures 6.8 Total debt 24.4 Unused lines of Credit 14.8 Debt to Equity Ratio ~1.1x Dh
Slide 29: Superior Growth enabled by Lending-as-a-Service
Products Distribution & Technology Capital Efficiency Risk Management Governance Superior Growth enabled by Lending-as-a-Service enhances Capital Efficiency on Balance Sheet Business Model ■ Dhanvarsha contributes between 10% to 20% of loan ■ Currently tied up and in discussion with: amount while re
Slide 30: Conservative Underwriting Processes
Products Distribution & Technology Capital Efficiency Risk Management Governance Conservative Underwriting Processes Suitable for the Customer Segment and Products Standard ■ Case evaluation benchmarks are objective parameters and processes ■ Plug-and-play model which can be adapted to different pro
Slide 31: Risk & Governance
Products Distribution & Technology Capital Efficiency Risk Management Governance Risk & Governance …driven by a team with strong experience in Risk mitigated portfolio approach… risk and controls ■ ~35% of Loan Book is backed by Gold resulting in ■ Mr. Mahendra Servaiya is one of the most experience
Slide 32: Robust In-House Collection Function With Strong Controls
Products Distribution & Technology Capital Efficiency Risk Management Governance Robust In-House Collection Function With Strong Controls ■ In-house collection management team headed by Improvement in collection efficiency*… veteran with 15+ years experience & team comprising Including prepayments a
Slide 33: RAS Framework
Products Distribution & Technology Capital Efficiency Risk Management Governance RAS Framework Thresholds Type of Metric Name/Description Green Amber Red Q2FY22 Q1FY22 Solvency Overall Capital Adequacy Buffer (Min. of 15%+) >= 30% >=20% & <30% < 20% 56.5% 82.7% Tier-1 Capital Buffer (Regulation stat
Slide 34: Managed By An Illustrious Board Comprising Veterans From The Industry
Products Distribution & Technology Capital Efficiency Risk Management Governance Dhanvarsha Is Managed By An Illustrious Board Comprising Veterans From The Industry… Rakesh Sethi Non-Executive Chairman ■ 38+ years of experience ■ Ex-CMD of Allahabad Bank ■ Ex-ED of Punjab National Bank Rajiv Kapoor
Slide 35: And led by a professional management team
Products Distribution & Technology Capital Efficiency Risk Management Governance …And led by a professional management team Karan Desai Rohanjeet Juneja Joint Managing Director Joint Managing Director • Ex-investment banker with 15+ years of experience • 17+ years of experience, in India & US. • Pre
Slide 36: Management team (Cont'd)
Products Distribution & Technology Capital Efficiency Risk Management Governance …who bring substantial experience in the financial services space (Cont’d) Lalit Chendvankar Namita Pradhan Chief Compliance Officer Human Capital Management ■ 16+ years robust experience in handling Mergers & ■ 6+ year
Slide 37: Financials
DP ’& VS Financials
Slide 38: Financials – Balance Sheet
Financials – Balance Sheet Balance Sheet (USD Million) Mar20 Mar21 Jun20 Jun21 Sep20 Sep21 ■ Strong liquidity profile Financials Assets 5.6 23.0 7.5 35.3 10.2 44.1 coupled with an un-levered balance sheet will support Cash and Investments 1.2 9.4 2.5 18.2 2.6 12.7 higher disbursement trajectory Gros
Slide 39: Financials – Income Statement
Financials – Income Statement FY FY H1 H1 Q1 Q2 Q1 Q2 USD Million Mar20 Mar21 Sep20 Sep21 Jun20 Jun21 Sep20 Sep21 Interest Income 0.87 1.65 0.60 2.40 0.22 0.84 0.39 1.56 ■ Robust growth in profits Less: Finance Cost 0.23 0.57 0.23 1.17 0.09 0.47 0.15 0.70 driven by healthy Net Interest Income 0.64 1
Slide 40: Addendum
D0 V \ Addendum
Slide 41: India Is Enjoying Significant Tailwinds In MSME Lending
India Is Enjoying Significant Tailwinds By Way Of A Highly Underserved White-Space In MSME Lending 63 million MSMEs in India employ 110+ ~350 million Mn individuals i.e., more than 20% of Blue Collared Workers in India the employable population in India Potential Market Size Potential Market Size US
Slide 42: Gold Loans – A Very Large Market Opportunity In India
Gold Loans – A Very Large Market Opportunity In India While traditionally banks have had a larger share of gold loans The market for gold loans has grown at a healthy clip… in India… Amounts in USD Bn 57 25% 44 39 31 33 29 28 NBFCs Banks 75% FY15 FY16 FY17 FY18 FY19 FY20 FY21 The industry is expecte
Slide 43: Disclaimer
Disclaimer This presentation has been prepared for general information purposes in respect of Dhanvarsha Finvest Limited (“Company”) together with its subsidiary (together, with the Company, the “Dhanvarsha Group”) only, without regard to any specific objectives, suitability, financial situations an
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