Home First Finance Company India Ltd. · NSE:HOMEFIRST
Home First Finance Company India — Q3 FY24 Earnings Presentation
48 slides from Home First Finance Company India's earnings presentation, January 2024
Slide 1: Home First Finance Company India Limited
Home First Finance Company India Limited
Slide 2: Safe Harbour
Safe Harbour Safe Harbour This presentation and the accompanying slides (the "Presentation"), which have been prepared by Home First Finance Company India Ltd. (the "Company"), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase
Slide 3: Q3FY24 Highlights
Q3FY24 Highlights Executive Summary | Q3FY24 y-o-y q-o-q Assets Under Management (AUM) Disbursement Gross Stage 3 / POS (GNPA) ₹ 90,137 Mn ₹10,072 Mn 1.7%(1) In line with RBI circular dated 12 Nov 2021 1.1% prior to such classification +33.5% +7.7% +29.1% +5.0% -10 bps 0 bps Spread(2) Opex to Assets
Slide 4: MD & CEO Commentary on Q3 FY24 Performance
MD Commentary MD & CEO Commentary on Q3 FY24 Performance “We are happy to continue the growth momentum in Q3FY24. HomeFirst’s performance has been strong across all operating and financial parameters. We delivered PAT growth of 34.2% on y-o-y & 6.1% on q-o-q basis leading to ROE of 15.8% in an high
Slide 5: HomeFirst – Who are We?
HomeFirst – Who We Corporate Information Are? HomeFirst – Who are We? MorningStar Sustainalytics Technology driven affordable housing ESG Risk Rating finance company with pan India presence ‘Amongst Leading Ratings in BFSI Sector’ Home loans to first time home buyers with predominant focus on salaried
Slide 6: Our Journey
Corporate Information Our Journey India ICRA / CARE CARE Rating CARE / ICRA Rating Ratings Rating BBB- BBB+ A- A+ AA- AA- AUM crosses ₹75 bn. 100+ Physical 90,137 Scalable operating model Branches ₹ 90,137 Mn 1,00,000+ Customers Assets Under Management We got listed 71,980 W arburg Pincus invested i
Slide 7: Shareholding as on Jan'24
Corporate Information Shareholding as on 12 Jan’24 PROMOTER & PROMOTER GROUP % Holding TRUE NORTH FUND V LLP 14.2 AETHER (MAURITIUS) LIMITED (GIC)^ 9.4 KEY INVESTORS % Holding ORANGE CLOVE INVESTMENTS B.V (WARBURG PINCUS) 23.1 MFS & AIFS % Holding* INVESCO INDIA MF 3.0 Public & Others 16.7% 14.2% TR
Slide 8: Distinguished Board of Directors
Leadership Distinguished Board of Directors 08 Home First Finance Company India Ltd. Investor Presentation – Q3 FY24
Slide 9: Experienced Management Team
Leadership Experienced Management Team Ajay Khetan Vilasini Subramaniam Chief Business Officer Head – Strategic Alliances Gaurav Mohta Nutan Gaba Patwari Ashishkumar Darji Chief Marketing Officer Chief Risk Officer Chief Financial Officer Abhijeet Jamkhindikar Ramakrishna Vyamajala Arunchandra Jupalli Busin
Slide 10: Meet Our Customers
Corporate Information Meet Our Customers Formal Salaried Informal Salaried Self Employed Salaried Self Employed Customer 3 Customer 1 Customer 2 Age:38 / Location: Indore 68% Age: 46 / Location: Hyderabad 32% Age: 46 / Location: Haridwar Who are they? Govt. employee - working at Nagar Nigam, has a t
Slide 11: Our Unique Value Proposition to Our Customers
Corporate Information Our Unique Value Proposition to Our Customers Who are our customers What do our customers need What challenges do they face Salaried and self-employed NPS Home loan requirement primarily Inability to meet documentation individuals in the ₹0.5 -1.5 mn range (1) requirements of t
Slide 12: Distribution Strategy
Corporate Information Distribution Strategy 0 -4 4-7 7 - 15 Contribution to India's GDP FY’23 ( %) Pan India Distribution driven by strategic market selection & contiguous expansion Physical branches - 123 305 Proposed branches - 65 Touchpoints Digital branches - 117 123 126 13 305 Branches District
Slide 13: Omni Channel Lead Generation Strategy
Corporate Information Omni Channel Lead Generation Strategy Diversified lead generation channels | Q3 FY24 77.1% Diversified channels for generating leads such as connectors, builder ecosystem, digital, etc. 100% in-house conversion 8.2% by HomeFirst RMs. 1.2% 2.8% 2.4% 3.7% 3.4% 0.3% 0.9% Constructio
Slide 14: Data Science Backed Centralised Underwriting
Corporate Information Data Science Backed Centralised Underwriting Risk Management Design Tech-Led Centralised Salaried customers 100+ data points & digitally captured Consistency in underwriting Loans Approved within 48hrs data for all customers Build detailed understanding of customer Integrated C
Slide 15: Scalable Operating Model built on Holistic Technology Usage
Corporate Information Scalable Operating Model built on Holistic Technology Usage Recent Tech Interventions • Account Aggregator API Integration with third Data on Cloud Home First App for all Digital marketing on major party databases • KRA module integration with LOS stakeholders online media Inte
Slide 16: Digital Adoption
Corporate Information Digital Adoption Customer Rating on Google Unique user logins as % of active Playstore % Customers registered on App customers 91% 93% 93% 94% 94% 4.1 55% 57% 55% 54% Average payment per user on 54% As of 17 Jan’24 app ₹30,498 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q3FY23 Q4FY23 Q1
Slide 17: Building the Brand HomeFirst
Corporate Information Building the Brand HomeFirst 17 Home First Finance Company India Ltd. Investor Presentation – Q3 FY24
Slide 18: ESG at HomeFirst
ESG at HomeFirst Putting sustainability at core of operations
Slide 19: Commitment to ESG
ESG Commitment to ESG ESG Framework An ESG Execution Team with The Company understands the Comprehensive management team participation has growing importance of ESG and Policy & Robust been created to ensure has adopted a Board approved Governance Implementation implementation of the ESG Policy ESG
Slide 20: Digital Processes from start to finish to reduce Carbon Footprint
ESG Digital Processes from start to finish to reduce Carbon Footprint Customer App Connector App RM Pro App Green Operations Operational Eco-efficiency & Climate Resilience HomeFirst has a deeply ingrained Ideology of all processes being paperless across the product cycle. Implemented Electronic pro
Slide 21: Progress on Social Development
ESG Progress on Social Development Responsibility towards community Responsibility towards employees Project “Sashakt”, an initiative by HomeFirst to bring an all- Employee Training and Development around improvement in the social, health and economic status of migrant factory workers living in Naro
Slide 22: Progress on Social Development
ESG Progress on Social Development Responsibility towards customers ESG Initiatives Sustainable Finance Customer Satisfaction • Funds raised from IFC to finance affordable housing and green housing. HomeFirst raised Rs 280 crores from International Finance Corp (IFC) through up to 7-year debt. Link
Slide 23: Strong Governance Structure
ESG Strong Governance Structure Separate Chairman & Managing Work Sustainably & Ethically Governance at core Director position Sustainable Finance Corporate Governance We promote Financial Inclusion. • Core competencies of Independent Directors directly relevant to company’s operations. Experienced
Slide 24: Strong Governance Practice
ESG Strong Governance Practice Corporate Governance Structure Top-tier Corporate Governance • High Independent Directors representation in all Board Committees • Highly experience Board & Management Team on Risk Management committee. • Company's risk management framework is driven by its Board and i
Slide 25: Business Updates
Business Updates
Slide 26: Healthy Growth in Loan Book and Disbursements
Business Updates Healthy Growth in Loan Book and Disbursements Disbursement ( ₹Mn ) Last 5 Years Last 5 Quarters 9,591 10,072 8,691 8,952 Crossed Rs 1000 Cr Disbursement 30,129 7,804 Milestone for first time. 20,305 15,728 16,183 Q-o-q growth of 5.0% and y-o-y growth of 10,966 29.1% FY19 FY20 FY21 F
Slide 27: Consistent Portfolio Matrix | Dec'23
Business Updates Consistent Portfolio Matrix | Dec’23 13% 32% 1% AUM by Product AUM by Occupation Salaried Housing Loan Shop Loans Self Employed LAP Sharp focus on High ratio of 86% housing loans 68% salaried customers 82% 2% 12% 18% AUM by Credit history AUM by Ticket Size 10% Upto 0.5mn AVG: 744 H
Slide 28: Competitive Spreads
Business Updates Competitive Spreads Portfolio Yield COB Net Interest Spread Movement Spread Repricing schedule 25bps w.e.f 1st Jul’22 Last 5 Years Last 5 Quarters 50bps w.e.f 1st Dec’22 50bps w.e.f 1st Apr’23 13.4% 13.7% 13.6% 13.5% 12.9% 13.0% 13.1% 13.1% 12.8% 12.3% Competitive Cost of Borrowing
Slide 29: Healthy Leading Indicators
Business Updates Healthy Leading Indicators Bounce rate : On the day of EMI presentation Bounce rate Bounce rates are range-bound COVID COVID WAVE -1 WAVE -2 36.4% 28.3% 20.1% 17.3% 18.3% 16.5% 15.7% 15.6% 14.5% 14.9% 15.0% 14.2% 15.1% 15.3% 14.0% 13.6% 10.0% 10.9% 10.5% 9.5% Q1FY20 Q2FY20 Q3FY20 Q4
Slide 30: Healthy Leading Indicators
Business Updates Healthy Leading Indicators Collection Efficiency Collection Efficiency (1) Collection efficiency at normal levels Unique Customers (2) 98.5% 98.3% 98.5% 98.3% 98.3% 98.7% 98.7% 98.5% 99.3% 98.0% 97.3% 98.8% 98.5% 98.0% 98.8% 97.3% 98.9% 97.3% 97.8% 97.7% 97.5% 97.5% 97.4% 97.4% 97.3% 97.2
Slide 31: Sound Credit Indicators
Business Updates Sound Credit Indicators DPD 1+ / POS DPD 30+ / POS % Stage 3 / POS Stage 2 / POS 6.2% Asset quality at 5.3% 4.1% 4.4% 4.4% 4.5% 4.5% 3.7% 4.0% 4.0% 4.3% healthy levels 1.8% 3.0% 2.7% 2.9% 2.9% 3.0% 3.2% 2.7% 2.0% 2.3% 1.7% 1.6% 1.8% 1.6% 1.6% 1.7% 1.7% 0.8% 1.0% 2.3% 0.9% 1.4% 1.1%
Slide 32: Diversified funding profile at competitive Cost of Borrowing
Business Updates Diversified funding profile at competitive Cost of Borrowing DA Borrowings Mix and Cost of Borrowing trend Co-Lending NCD Total Borrowings NHB Refinance 40,150 44,919 48,387 52,281 58,009 59,556 68,215 72,792 82,514 (₹Mn) (1) NBFC Dec'21 Mar'22 Jun'22 Sep'22 Dec'22 Mar'23 Jun'23 Sep'
Slide 33: ALM Position as of Dec'23 - Cumulative
Business Updates ALM Position as of Dec’23 - Cumulative Inflow Outflow Surplus 16,710 18,780 20,427 23,675 36,178 21,444 (₹Mn) 1,44,724 Robust ALM profile ensuring 1,26,896 sufficient liquidity 1,23,280 buffers 90,088 90,718 Cumulative 66,413 Positive flows across all the 46,350 time buckets 33,958 26,211
Slide 34: Assignment and Co-lending Transactions
Business Updates Assignment and Co-lending Transactions Direct Assignment Transactions Co-Lending Transaction ₹3,003 Mn ₹4,646 Mn ₹3,784 Mn ₹4,570 Mn Consistent demand for assignment 1,956 1,844 of the company’s portfolio 1,471 609 1,273 1,159 1,183 1,140 1,154 1,143 1,050 502 879 857 894 Generated
Slide 35: Strong Liquidity Position
Business Updates Strong Liquidity Position Liquidity Buffer as on Dec’23 (in ₹Mn) Unencumbered Cash and Cash equivalent 12,231 Un-availed Sanction from NHB 2,500 Un-availed Sanction from Banks 9,949 Total 24,680 ₹ 6,020 million Liquidity raised during Q3FY24 Particulars (in ₹Mn) Q4FY24 Q1FY25 Q2FY25
Slide 36: Financial Updates
Financial Updates
Slide 37: Financial Highlights
Financial Updates Financial Highlights Profit After Tax ( ₹Mn ) Net worth ( ₹Mn ) Equity Raised 1508 3281 3450 32 53 29 53 15 21 36 ( ₹Mn ) 2,283 (1) 1,741 20,318 Robust NW to Strong profit growth 18,173 18,680 19,467 17,483 18,173 support growth 15,737 1,001 13,805 796 743 788 691 9,334 457 640 587 5
Slide 38: ECL Provisions Summary
Financial Updates ECL Provisions Summary Loan Particulars (in ₹Mn) Stage 1 Stage 2 Stage 3 Commitment Total For period ended Dec’23 Loans – Principal Outstanding 73,863.5 983.6 1,295.3 76,142.4 ECL Provision 200.2 76.3 387.5 14.9 678.9 Net Loans – Principal Outstanding 73,663.3 907.3 907.8 75,463.5
Slide 39: Annexures
Annexures
Slide 40: Quarterly and Annual Profit and Loss Statement
Financial Updates Quarterly and Annual Profit and Loss Statement Particulars (in ₹Mn) Q3FY24 Q2FY24 Q3FY23 QoQ YoY FY23 FY22 YoY Interest Income on term loans 2,508.9 2,347.8 1,800.7 6.9% 39.3% 6,825.0 4,770.5 43.1% Net gain on DA 206.3 151.4 76.0 380.4 678.4 Income other than interest income on ter
Slide 41: RoE Tree
Financial Updates RoE Tree Particulars Q3FY24 Q2FY24 Q3FY23 FY23 FY22 Interest Income on term loans / Average total assets 11.8% 12.0% 11.5% 11.5% 9.9% Net Gain on DA / Average total Assets 1.0% 0.8% 0.5% 0.6% 1.4% Income other than interest income on term loans/ Average total assets 1.3% 1.4% 1.1%
Slide 42: Key Financial Ratios
Financial Updates Key Financial Ratios Particulars Q3FY24 Q2FY24 Q3FY23 FY23 FY22 Profit after tax on average total assets (ROA) 3.7% 3.8% 3.8% 3.9% 3.6%(1) Leverage (Average total assets / average Equity 4.3 4.1 3.6 3.5 3.3 or average Net worth) Profit after tax on average equity or average Net 15.
Slide 43: Balance Sheet
Financial Updates Balance Sheet Particulars (in ₹Mn) Dec’23 FY23 FY22 ASSETS Cash & cash equivalents and Other bank 5,528.7 2,984.1 6,678.5 balance Loans 75,478.5 59,957.0 43,048.7 Investments 7,140.9 2,808.0 0.0 Other financial assets 1,445.1 1,241.0 1,164.8 Property, plant and Equipment* 264.5 253
Slide 44: Consistent Financial Performance over the years
Financial Updates Consistent Financial Performance over the years Particulars (in ₹Mn) FY17 FY18 FY19 FY20 FY21 FY22 FY23 CAGR % Operational Information Number of Branches 36 42 60 68 72 80 111 Loan disbursals 4,244 7,455 15,728 16,183 10,966 20,305 30,129 AUM 8,473 13,559 24,436 36,184 41,411 53,80
Slide 45: Experienced and Diverse Board
Leadership Experienced and Diverse Board Mr. Deepak Satwalekar Ms. Geeta Dutta Goel Mr. Anuj Srivastava Chairman/ Independent/ Non-Executive Director Independent/ Non-Executive Director Independent/ Non-Executive Director Mr. Deepak Satwalekar was associated with HDFC Limited as a Ms. Geeta Dutta Go
Slide 46: Thank You
Thank You For further information, please contact Company CIN: L65990MH2010PLC240703 Mr. Manish Kayal, Head - Investor Relations manish.kayal@homefirstindia.com Investor Relations - HomeFirst investor.relations@homefirstindia.com
Slide 47: Glossary
Glossary Glossary Terms Explanation Assets Under Management/Gross Loan Assets represents the aggregate of current principal AUM - Assets Under Management outstanding and overdue principal outstanding, if any, for all loan assets under management which includes loan assets held by the Company as of t
Slide 48: by homefirst
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Home First Finance Company India — Q3 FY24 Earnings Presentation on 6ix