Poonawalla Fincorp Limited · NSE:POONAWALLA
Poonawalla Fincorp — Q2 FY2023 Earnings Presentation
50 slides from Poonawalla Fincorp's earnings presentation, Oct 21, 2022
Slide 1: Cover letter to stock exchanges: Investors/Analysts' Presentation
21 October 2022 BSE Limited National Stock Exchange of India Limited Corporate Relationship Department The Listing Department, 25th Floor, Phiroze Jeejeebhoy Towers, Exchange Plaza, Dalal Street, Fort, Bandra- Kurla Complex, Bandra (East), Mumbai - 400 001. Mumbai - 400 051. BSE Scrip Code: 524000 N
Slide 2: Poonawalla Fincorp Limited Investor Presentation Q2FY23
Poonawalla Fincorp Limited (Formerly known as Magma Fincorp Limited) Investor Presentation Q2FY23 Scalable Business Model | Pure Retail Play | Digital-First Tech-Led | Customer Centric
Slide 3: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 4: Q2FY23 Performance - Excellent Quarter on All Fronts
Q2FY23 Performance- Excellent Quarter on All Fronts Differentiated strategy and execution excellence led to all round performance across business growth, credit quality & profitability Amounts in ₹ cr Highest ever quarterly disbursement AUM Disbursement 18,560 3,721 Highest ever PAT & RoA +22% YoY |
Slide 5: Executive Summary - Consolidated
Executive Summary - Consolidated Setting the momentum for expanding growth horizon Strong Business Momentum Continues in Q2FY23 ▪ Highest ever quarterly disbursement of ₹ 3,721 cr with new products scaling up well ▪ Consistent increase in organic disbursement: Up 180% YoY & 32.4% QoQ QoQ organic dis
Slide 6: Executive Summary - Consolidated
Executive Summary - Consolidated Setting the momentum for expanding growth horizon Robust Asset Quality ▪ Lowest GNPA & NNPA in last 38 quarters ▪ Post the alignment with revised NPA definition as per RBI circular, GNPA & NNPA reduced to 1.52% & 0.83% respectively compared to GS3 & NS3 of 2.19% & 0.
Slide 7: Executive Summary - PFL Standalone
Executive Summary - PFL Standalone Setting the momentum for expanding growth horizon Key Highlights Q2FY23 100% disbursement through organic route at ₹ 3,110 cr AUM stood at ₹ 13,161 cr ↑ 16.8% YoY & ↑ 4.4% QoQ ↑ 243.7% YoY & ↑ 30.8% QoQ Focused AUM ↑ 68.5% YoY and ↑ 12.5% QoQ Monthly disbursement r
Slide 8: Executive Summary - PHFL
Executive Summary - PHFL Key Highlights Q2FY23 AUM stood at ₹ 5,612 cr ↑ 30.9% YoY & ↑ 6.2% QoQ Disbursement of ₹ 611 cr; ↑ 56.8% YoY & 14.3% QoQ North : West : South : East AUM mix % Operating in 128 branches as on Sep 22 Sep 22:- 33 : 35 : 26 : 6 GNPA* of 0.84% ↓ 108 bps YoY & ↓ 3 bps QoQ Average
Slide 9: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 10: Scalable Business Model to Drive Profitable Growth
Scalable Business Model to Drive Profitable Growth Uniquely positioned Inherent Strengths… Brand Strength & Strong Management Digital First and Technology Led Target Market Aligned Distribution & Products Flagship financing arm of Cyrus Poonawalla Digitalized end to end processes Unique sourcing mod
Slide 11: Successfully Executing our Strategic Plan
Successfully Executing our Strategic Plan 1 Differentiating by Offering Superior Customer Value 2 Aligning Distribution & Products that Suit Target Market 3 Digital-First, Technology-Led to the Core 4 Upholding Robust Credit Quality 5 Continuously Optimizing Cost of Borrowing & Liquidity 6 Future Re
Slide 12: Differentiating by Offering Superior Customer Value
1 Differentiating by Offering Superior Customer Value To ensure sustainable growth & leadership in chosen segments Accelerating organic disbursement growth Focused AUM has grown 56% YoY ₹ cr 2.8x 3,625 ₹ cr 1.6x 17,015 2,738 15,379 2,164 13,605 1,543 11,602 1,295 10,900 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q
Slide 13: Distribution: In Sync with Emerging Business Models
2a Distribution: In Sync with Emerging Business Models Direct Digital Program (DDP) led distribution model Direct Channel Digital Channel Digital ecosystem In-house sourcing of In-house sourcing of Multiple tie-ups, alliances & DDP Distribution customers through own customers through web, social par
Slide 14: Product Suite: Tailored for the Target Segment
2b Product Suite: Tailored for the Target Segment Focus on Consumer & MSME segment with diversified offerings Existing products Upcoming products Pre-owned Cars Digital Business Loans Machinery Loan Consumer Finance Affordable Home Loan Digital Personal Loan Digital Consumption Loan Merchant Cash Ad
Slide 15: Digital-First, Technology-Led to the Core
3a Digital-First, Technology-Led to the Core Leading to competitive moat, efficient operations & sustained growth Deep Investments in Technology Building a Tech led Play Customers Partners Self service online web application Extended API Infrastructure Core Contact center led digital onboarding CRM
Slide 16: Digital Transformation Yielding Results
3b Digital Transformation Yielding Results End to End Digitalized Lending – Lower TATs, Minimal Paperwork, Reduced human intervention ▪ End to end digital journey capability for customers across all products via Digital KYC, Digital Onboarding (E-sign, E-agreement & E-NACH), Automated BRE for quick
Slide 17: Upholding Robust Credit Quality
4 Upholding Robust Credit Quality Consistent outperformance on Asset Quality GS3 / GNPA* (%) NS3 / NNPA* (%) 4.11 2.01 3.50 1.78 2.66 2.19 1.11 1.52 0.95 0.83 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Chosen market segment, Prudent underwriting & Collection capabilities:
Slide 18: Optimizing Cost of Borrowing & Liquidity Position
5 Optimizing Cost of Borrowing & Liquidity Position Average Cost of Borrowing (PFL consolidated) Two notch increase in credit rating to AA+/Stable by CARE 9.56% Assigned AA+/Stable credit 9.05% rating by CRISIL Credit rating upgraded to AAA/Stable by CARE 8.03% 7.41% 7.12% 6.92% Repo rate hike → Q1F
Slide 19: Future Ready Human Capital with Strong Leadership
6 Future Ready Human Capital with Strong Leadership Building the Right Culture Productivity & Operational Employee Development Efficiency Engagement Rewards • New HRMS system & • Employee satisfaction survey • OKR framework launched • Well defined development analytics launched with GPTW initiated p
Slide 20: Management Vision 2025
Management Vision 2025 Performance well ahead of long-term guidance Vision 2025 On the right track (Q2FY23 status) To be amongst the Top 3 NBFCs in consumer and Leadership board position in 3 products:- BL, POC MSMEs and LTP on monthly disbursement basis Risk-calibrated accelerated growth, ~3x of FY
Slide 21: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 22: Performance Parameters - Consolidated
Performance Parameters - Consolidated Robust growth continues | Significant reduction in GNPA & NNPA Amounts in ₹ cr Disbursement AUM Networth Focussed Discontinued 3,721 3,336 3,436 17,660 18,560 6,410 16,579 1,545 6,235 15,275 15,228 2,281 2,580 6,058 2,974 5,925 1,845 4,375 3,626 5,841 15,379 17,
Slide 23: Asset Quality
Asset Quality Significant improvement on sustained basis PFL PHFL Consolidated Sep-21 Jun-22 Sep-22 Sep-21 Jun-22 Sep-22 Sep-21 Jun-22 Sep-22 Stage 1 Assets 80.9% 90.8% 93.6% 86.0% 92.2% 96.1% 82.1% 91.1% 94.3% Stage 2 Assets 14.3% 6.6% 4.7% 12.1% 7.0% 3.0% 13.8% 6.7% 4.2% Stage 1 PCR 1.5% 2.5% 0.9%
Slide 24: Profit & Loss Statement - Consolidated
Profit & Loss Statement - Consolidated Particulars Q2FY23 Q2FY22 Q1FY23 YoY QoQ FY22 NII 446 336 398 32.7% 11.9% 1,325 Opex 269 177 235 51.8% 14.2% 742 PPOP 177 159 163 11.3% 8.7% 583 Credit cost (41) 35 (12) - - 93 Share of profit in JV 0 3 0 - - 2 Profit Before Tax 218 126 183 72.2% 19.3% 492 Prof
Slide 25: Balance Sheet - Consolidated
Balance Sheet - Consolidated Particulars 30-Sep-22 30-Sep-21 31-Mar-22 Cash & Bank balances 506 790 597 Receivables 24 15 15 Loans (Net of provision) 17,012 13,153 14,851 Investments 659 192 0 Other Financial Assets 442 226 235 Non Financial Assets 649 609 746 Total Assets 19,293 14,984 16,443 Borro
Slide 26: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 27: Performance Parameters - Standalone
Performance Parameters - Standalone Robust growth continues | Significant reduction in CoB, GNPA & NNPA Amounts in ₹ cr Disbursement AUM Networth Focussed Discontinued 3,110 13,161 2,901 12,606 6,018 2,539 11,269 11,765 5,878 2,190 10,914 1,545 2,281 5,715 2,974 5,616 1,310 4,375 3,626 5,531 10,325
Slide 28: ALM statement and Liquidity - PFL Standalone
ALM statement and Liquidity - PFL Standalone Structural Liquidity Statement as on 30th Sep 22 18,106 18,106 Cumulative inflows (₹ in Cr) Cumulative outflows(₹ in Cr) 16,593 15,527 11,144 11,694 10,171 7,817 5,873 6,443 4,456 3,056 791 1,491 829 1,217 1,575 39 75 211 1-7d 8 - 14d 0-1m 1-2m 2-3m 3-6m
Slide 29: Profit & Loss Statement - PFL Standalone
Profit & Loss Statement - PFL Standalone Particulars Q2FY23 Q2FY22 Q1FY23 YoY QoQ FY22 NII 336 269 310 25.1% 8.4% 1,058 Opex 210 145 190 44.6% 10.3% 595 PPOP 127 124 120 2.2% 5.4% 463 Credit cost (47) 25 (14) - - 78 Profit Before Tax 174 98 155 76.9% 12.3% 385 Profit After Tax 130 74 124 75.8% 5.3%
Slide 30: Balance Sheet - PFL Standalone
Balance Sheet - PFL Standalone Particulars 30-Sep-22 30-Sep-21 31-Mar-22 Cash & Bank balances 335 730 537 Receivables 22 15 14 Loans (Net of provision) 12,290 9,909 10,678 Investments 1,479 929 820 Other Financial Assets 317 119 144 Non Financial Assets 534 570 616 Total Assets 14,978 12,272 12,810
Slide 31: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 32: Poonawalla Housing Finance - At a glance
Poonawalla Housing Finance At a glance Amounts in ₹ cr AUM Q2FY23 ➢ Poonawalla Housing Finance Limited (PHFL), subsidiary Disbursement of PFL, is a PAN India affordable segment HFC with 5,612 611 +31% YoY | +6% QoQ 128 branches across India. +57% YoY | +14% QoQ ➢ Direct relationship model with the c
Slide 33: Historical Performance - PHFL
Historical Performance - PHFL Poised for sustainable growth – Directly sourced, Granular, Home loan focus book Amounts in ₹ cr Disbursement AUM Live Customers (in 000s) Direct Ratio (Units) 1,970 46 5,060 78% 80% 77% 75% 1,315 1,251 3,978 33 1,085 3,283 27 44% 2,429 18 562 12 1,808 FY18 FY19 FY20 FY
Slide 34: Performance Parameters - PHFL
Performance Parameters - PHFL Robust AUM growth with Significant reduction in GNPA and NNPA Amounts in ₹ cr Disbursement AUM Networth 797 5,612 1,151 5,282 1,114 611 5,060 1,082 1,038 1,048 535 535 4,574 4,287 390 Q2FY22 Q3FY22 Q4FY22 Q1FY23 Q2FY23 Sep-21 Dec-21 Mar-22 Jun-22 Sep-22 Sep-21 Dec-21 Ma
Slide 35: ALM statement and Liquidity - PHFL
ALM statement and Liquidity - PHFL Well matched ALM profile | Adequate liquidity Structural Liquidity Statement as on 30th Sep 22 7,740 Cumulative Inflow Cumulative Outflow 6,320 5,527 4,066 4,303 3,016 1,7701,429 666 464 1,007 683 325 187 0 - 1 Month 1 - 3 Month 3 - 6 Month 6 Month - 1 Year 1 Year
Slide 36: Profit & Loss Statement - PHFL
Profit & Loss Statement - PHFL Particulars Q2FY23 Q2FY22 Q1FY23 YoY QoQ FY22 NII 109 67 88 62.6% 24.5% 263 Opex 59 32 45 84.7% 30.6% 147 PPOP 50 35 43 42.6% 18.0% 116 Credit cost 7 10 2 (31.7%) 186.7% 14 Profit Before Tax 43 25 40 72.0% 8.0% 101 Profit After Tax 33 19 30 75.1% 8.3% 77 Amounts in ₹ c
Slide 37: Balance Sheet - PHFL
Balance Sheet - PHFL Particulars 30-Sep-22 30-Sep-21 31-Mar-22 Cash & Bank balances 173 62 62 Loans (Net of provision) 4,727 3,252 4,177 Other Financial Assets 133 111 86 Non Financial Assets 63 37 62 Total Assets 5,095 3,462 4,387 Borrowings 3,838 2,337 3,198 Other Liabilities 106 87 107 Share Capi
Slide 38: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 39: Way Forward
Way Forward Lead indicators point at strong performance in H2FY23 & beyond ► Strong growth expected in H2FY23 & beyond Achieved monthly organic disbursement rate of ~ ₹ 1,300 cr in Sep 22 providing momentum for future growth Strong digital distribution model and product diversification ► Direct Digi
Slide 40: Digital Transformation Journey So Far & Way Forward
Digital Transformation Journey So Far & Way Forward It’s been 5 quarters since Magma acquisition; we have successfully completed Phase 1 of technology transformation and launched multiple new products as per our stated strategy. It has helped put in place a stable and scalable digital platform. With
Slide 41: Strong Roots of Digital, Technology & Analytics
Strong Roots of Digital, Technology & Analytics Successfully implemented in Phase 1 over the last 5 quarters Customer Relationship Loan Origination Rule Engine Loan Management Collection Management Core Platform Management Platform Platform Platform Platform Lead generation Onboarding Real time Anal
Slide 42: Phase 2: Deepening Technology, Digital & Analytics
Phase 2: Deepening Technology, Digital & Analytics More Innovative, Digitized, Personalized, Engaging & Convenient - For superior customer experience Highly customised orchestration layer integrating across channels to create unique experience Consumer Data Apps Eco-System Personalization Engagement
Slide 43: Phase 2: Journey Started..
Phase 2 :Journey Started.. Ground-work on various initiatives underway Straight Through Customer Mobile Super App Based Lending Digital Collections Customer Portal Enhanced Disbursal Platform App & Referrals Platform Digital Partner On-boarding & Self Automated & Fully Fully Integrated Cloud ERP Mer
Slide 44: Phase 2: Enhanced Customer Service - 360 View
Phase 2: Enhanced Customer Service - 3600 View* Self Service, Personalized, Insight Driven – “Making Service delivery a Sales Channel” Promote & Manage Cross Sell Self Service & FTR Resolutions • Segmented campaign management in CRM • Agent assist & Customer 360 • STP fulfilment journey for Pre-Appr
Slide 45: Agenda
Agenda 1 Overview & Executive Summary 2-7 2 Strategy Execution 8-19 3 Business & Financial Highlights: Consolidated 20-24 4 Business & Financial Highlights: PFL Standalone 25-29 5 Business & Financial Highlights: Subsidiary (PHFL) 30-36 6 Digital Transformation Journey So Far & Way Forward 37-42 7 B
Slide 46: Board of Directors - Poonawalla Fincorp
Board of Directors - Poonawalla Fincorp Experienced & Diversified Board Mr. Adar Poonawalla Mr. Abhay Bhutada Mr. Amar Deshpande Mr. Sajid Fazalbhoy Mr. Atul Kumar Gupta Chairman & Managing Director Non-Executive Director Non-Executive Director Non-Executive Director Non-Executive Director Ms. Vijay
Slide 47: Awards and Accolades
Awards and Accolades Recognition from Industry circles HR Practices Customer Centricity Digital NBFC One of the most ‘Best Digital NBFC of Recognized as the Customer centric the Year’ award at the most preferred Brands at Economic 4th Annual India NBFC workplace 2022-23 Times CX Summit Summit 2022 2
Slide 48: Disclaimer
Disclaimer This presentation has been prepared by Poonawalla Fincorp Limited (the “Company”), for general information purposes only, without regard to any specific objectives, suitability, financial situations and needs of any particular person and does not constitute any recommendation or form part
Slide 49: Disclaimer (Continued)
Disclaimer (Continued) The information contained in these materials has not been independently verified. Neither the Company, its directors, promoter affiliates, nor any of its or their respective employees, advisers or representatives or any other person accepts any responsibility or liability what
Slide 50: Thank You
THANK YOU Team – Investor Relations Investor.relations@poonawallafincorp.com