Axis Bank Limited · NSE:AXISBANK
Axis Bank — Investor Day (November 2023)
30 slides from Axis Bank's investor day presentation, Nov 23, 2023
Slide 1: GPS Strategy Execution
GPS Strategy Execution ANALYST DAY 2023 November 23, 2023
Slide 2: Consistent execution on our GPS strategy, resulting in us becoming an all-weather franchise
Consistent execution on our GPS strategy, resulting in us becoming an all-weather franchise 1. Strengthened balance sheet, one of the best asset quality metrics in the sector 2. Risk framework and culture, ensure resilience through cycles 3. Deposit quality delivered; Deposit composition witnessing
Slide 3: Delivered or exceeded GPS commitments made...
Foundation & Strength Distinctiveness Differentiation Delivered or exceeded GPS commitments made... FY19 FY23 H1FY24 Advances mkt share 4.9% 6.0% 6.0% Lifted the growth Deposits mkt share 4.3% 5.1% 4.8% momentum (1) (2) Operating 8% 16% 30% Revenue growth (3) Cons ROE 8.58% 18.84% 19.04% Improved pr
Slide 4: …and surpassed our aspirational targets to deliver stronger, consistent and sustainable returns
Foundation & Strength Distinctiveness Differentiation …and surpassed our aspirational targets to deliver stronger, consistent and sustainable returns Trend in Consolidated ROA and ROE 2.00% 1.8%* 1.8% 1.80% 1.60% 1.3% 1.40% 0.7% 1.20% 1.00% 0.80% Consolidated ROA 0.60% 0.2% * 0.40% 0.20% 18.8% 19.0%
Slide 5: Strengthened balance sheet significantly with one of the best asset quality metrics in the industry
Foundation & Strength Distinctiveness Differentiation Strengthened balance sheet significantly with one of the best asset quality metrics in the industry Net NPA ratio for large banks PCR (as of Sep’23) 79% 75% 0.43% 0.35% 0.36% 69% 52% 6.77% Peer 1 Axis Bank Peer 2 4.86% Gross Retail NPA ratio for
Slide 6: Augmented risk frameworks and culture change, gives us confidence that franchise will remain resilient through cycles
Foundation & Strength Distinctiveness Differentiation Augmented risk frameworks and culture change, gives us confidence that franchise will remain resilient through cycles Stronger risk governance Systematic interventions • Robust ERM framework establishing • Credit risk – EWS models, policy interve
Slide 7: Delivering better than industry deposit growth, complimented with significant improvement in the quality of our deposit franchise
Foundation & Strength Distinctiveness Differentiation Delivering better than industry deposit growth, complimented with significant improvement in the quality of our deposit franchise (2) Growing faster than industry consistently… …with improvement in the quality of LCR deposits… …and higher CASA ra
Slide 8: Lifted growth momentum across our risk adjusted, higher yielding segments
Foundation & Strength Distinctiveness Differentiation Lifted growth momentum across our risk adjusted, higher yielding segments…. 55% Retail Segment 50% SBB, 45% 45% 40% Business Segment wise 35% 24% 25% Credit Cards, 28% CAGR (since FY20) in Focus 30% business segments SME, 19% 25% LAP, 21% Rural l
Slide 9: …contributing to the structural improvement in quality of earnings with better RWA profile…
Foundation & Strength Distinctiveness Differentiation …contributing to the structural improvement in quality of earnings with better RWA profile….. (1) Trend in Trailing 4 Quarters Standalone ROA and RoRWA (2) RWA growth for large banks Credit RWA* (FY20 to FY23) 60% 60% 60% 60% 59% 59% 58% 57% 57%
Slide 10: … and improving NIMs…
Foundation & Strength Distinctiveness Differentiation … and improving NIMs… (1) Structurally improved NIM trajectory 4.11% 4.02% 3.67% 25 bps 3.51% 3.53% Improvement in NIMs NIMs 3.44% 3.43% through cycle * 3.47% FY17 FY18 FY19 FY20 FY21 FY22 FY23 H1FY24 Retail & SME as % of loan book Non INR book a
Slide 11: .. and granular fees which is among the best in industry
Foundation & Strength Distinctiveness Differentiation .. and granular fees which is among the best in industry Total fee to average assets Improved the fee profile significantly in last few years (as of Q2FY24) 1.49% 1.25% 0.94% Granular* Fee to Avg Assets 1.33% 1.18% 1.20% 1.17% 1.20% 1.13% 1.10% P
Slide 12: Continue to build scale and create significant value in key subsidiaries
Foundation & Strength Distinctiveness Differentiation Continue to build scale and create significant value in key subsidiaries Invst Banking Consumer Retail Fintech Asset Management Trustee TReDS platform Insurance & Inst Equities focused NBFC Brokerage platform One of the fastest Leadership positio
Slide 13: We have crafted a winning strategy in partnerships, led by our cutting-edge tech stack and API prowess
Foundation & Strength Distinctiveness Differentiation We have crafted a winning strategy in partnerships, led by our cutting-edge tech stack and API prowess 100+ Partnerships across Platforms and Ecosystems – Highest among the peers (1) Aggregators (1) (1) (1) Mobility E-commerce Telecom (1) (1) Ena
Slide 14: Created multiplicative forces through unification of One Axis, partnerships and new age tech platforms to win across businesses
Foundation & Strength Distinctiveness Differentiation Created multiplicative forces through unification of One Axis, partnerships and new age tech platforms to win across businesses Digital 2.0. Partnerships ~63,500 Bharat Banking Retail Common Service Centre Village level entrepreneurs Assets 13 mn
Slide 15: Self-sustaining capital structure, resulting in value accretion for all stakeholders
Foundation & Strength Distinctiveness Differentiation Self-sustaining capital structure, resulting in value accretion for all stakeholders Historically equity raise was supporting capital consumption… … profit accretion is adequate to fund organic growth Includes 44 bps 0 towards assets acquired 6.0
Slide 16: Considerable progress on our key 'strategic bets for this decade & beyond'
Foundation & Strength Distinctiveness Differentiation Considerable progress on our key ‘strategic bets for this decade & beyond’ Best in class Digital and Analytics capabilities, puts us on path to 1 become India’s Best Tech Bank Inherent strengths in Bharat Banking, gives us the right to win in RuS
Slide 17: open by Axis Bank continues to deliver strong growth, as we remain ahead of the curve on new innovations
Foundation & Strength Distinctiveness Differentiation open by Axis Bank continues to deliver strong growth, as we remain ahead of the curve on new innovations 154 1st 100 To go live on Account Aggregator framework Deposits H1FY23 H1FY24 1st 177 Bank to launch (1) CBDC merchant app 100 Loans 1st H1FY
Slide 18: Our cutting-edge data analytics capabilities and leadership in technology continue to accelerate our distinctiveness journey
Foundation & Strength Distinctiveness Differentiation Our cutting-edge data analytics capabilities and leadership in technology continue to accelerate our distinctiveness journey 1st 1st 800 Resilient and scalable Indian Bank to roll-out Best-in-class Indian Bank to be ISO systems infrastructure cer
Slide 19: Bharat Banking strategy continues to play out well with strong growth momentum in RuSu markets
Foundation & Strength Distinctiveness Differentiation Bharat Banking strategy continues to play out well with strong growth momentum in RuSu markets 2,373 ~63,500 75+ Large and deep distribution Bharat Banking branches Common Service Centre Village Live Partners as of Sept 2023 level entrepreneurs D
Slide 20: Sparsh (Customer Obsession) and Siddhi (Empowering Employees) to set us apart in the next decade
Foundation & Strength Distinctiveness Differentiation Sparsh (Customer Obsession) and Siddhi (Empowering Employees) to set us apart in the next decade Sparsh – our Customer Obsession Program has Siddhi - the Super App that empowers Axis colleagues aided improvement in our NPS ranking… to engage seam
Slide 21: India's Wealth Management space
Foundation & Strength Distinctiveness Differentiation 1 in 3 richest Indians is our customer, making us a leading player in India’s Wealth Management space (In ₹ Bn) Overall Burgundy AUM^ has grown steadily 31% CAGR (since Mar’16) 32 4,531 of the 100 Richest Indians are Burgundy Private clients 3,57
Slide 22: Strong growth in Credit Card issuances and spends
Foundation & Strength Distinctiveness Differentiation Strong growth in Credit Card issuances and spends In million Among the largest credit card issuer in country with over 1mn 4th largest Credit Card player, closed the gap significantly with cards issued in each of last 7 quarters 3rd ranked player
Slide 23: Amongst the best and most comprehensive Wholesale Banking franchise
Foundation & Strength Distinctiveness Differentiation Amongst the best and most comprehensive Wholesale Banking franchise Differentiated ‘One Axis’ approach Strong market share position across payments.. With higher share of higher rated corporates (A-& above) as compared to peers 1st 1st 8% 11% ECM
Slide 24: Focus on granular, risk adjusted, higher yielding segments has made the bank more profitable
Foundation & Strength Distinctiveness Differentiation Focus on granular, risk adjusted, higher yielding segments has made the bank more profitable 21% 20% 18% 14% 15% 28% CAGR*# 28% CAGR# in combined MSME, MC and 42,328 SBB segment since Mar’20 38,078 40% CAGR# 26,481 95,954 19% CAGR# 17,148 89,398
Slide 25: Integration of acquired Citi Consumer Franchise remains on track
Foundation & Strength Distinctiveness Differentiation Integration of acquired Citi Consumer Franchise remains on track Apr ‘22 Jul ‘22 1st Mar '23 H1 FY25 We are here Announcement of LD1 LD2 CCI approval merger Legal merger System integration The ex-Citi colleagues have welcomed the opportunity to t
Slide 26: Citi acquisition: The portfolio metrics trending in-line with deal projections
Foundation & Strength Distinctiveness Differentiation Citi acquisition : The portfolio metrics trending in-line with deal projections Key focus on Synergy benefits by Adopting global best Controlled attrition in the customer retention harmonizing product practices in client servicing acquired talent
Slide 27: We have a distinctive people proposition
Foundation & Strength Distinctiveness Differentiation We have a distinctive people proposition Strengthening the talent pipeline AbLE ABYB School of Fintech thrive ARISE ASPIRE School of AVC An industry first focus on internal careers + more campus and skill factories Increased intake 2.3X to build
Slide 28: Committed to Positive Climate Action and Achieving the SDGs
Foundation & Strength Distinctiveness Differentiation Committed to Positive Climate Action and Achieving the SDGs • Axis Bank is the first Indian Bank to constitute a standalone ESG Committee of the Board • In September 2021, the Bank announced commitments aimed at supporting India’s low-carbon and
Slide 29: One Axis positions us well to play all mega trends of the next decade
Foundation & Strength Distinctiveness Differentiation One Axis positions us well to play all mega trends of the next decade SME & Atmanirbhar businesses Credit gap in MSME Rs. 25 tn (2022) Rising financial inclusion Consumption boom Financial inclusion index at 60.1 in Mar’23 vs 56.4 in Mar’22 Consu
Slide 30: Thank You
Thank You A's BANK