Bajaj Finance Limited · NSE:BAJFINANCE
Bajaj Finance — Q3 FY14 Earnings Presentation
26 slides from Bajaj Finance's earnings presentation, Jan 15, 2014
Slide 1: Bajaj Finance Limited Q3 FY14 Presentation
Bajaj Finance Limited Q3 FY14 Presentation 15th January 2014 1
Slide 2: Presentation Path
Presentation Path • Bajaj Finance product suite 3 • Business/Product launch journey 4 • Bajaj group structure 5 • Bajaj Finserv group - Executive summary 6 • Lending industry opportunity 7 • Executive summary 8 • Products & key characteristics 10 • Strong distribution reach 11 • Management discussio
Slide 3: Bajaj Finance product suite
Bajaj Finance product suite Bajaj Finance Limited Consumer Small Business Commercial Wealth Distribution Lending Lending Lending Management Services Consumer durables Business Loans Infrastructure Loans Term Deposits CRISIL Rating Two Wheeler Loan Against Auto Component Life Insurance Co-Branded Pro
Slide 4: Business/Product launch journey
Business/Product launch journey Retail SME +24 Commercial Fee Products +5 +6 Extended Warranty Emi Card Cross Sell Vendor Co-branded +3 Financing +3 Credit Card +3 Construction General Life Insurance Loans Against Infrastructure Equipment Insurance +2 Distribution Property Finance Financing Distribu
Slide 5: Bajaj group structure
Bajaj group structure Bajaj Holdings and Investment Limited (Listed) 1 2 31.49% 39.16% Bajaj Finserv Bajaj Auto Limited Limited (Listed) (Listed) Auto Business Arm Financial Services Arm 3 61.99% 74% 74% 100% Bajaj Finance Limited Bajaj Allianz life Bajaj Allianz General Bajaj Financial Insurance Co
Slide 6: Bajaj Finserv group - Executive summary
Bajaj Finserv group - Executive summary A 26 year old non bank finance company AUM of ` 38K Crore in FY13 Diversified consumer, SME & commercial lender One of the most profitable private life insurers in in India India. Credit rating of AA+ with (+) outlook by CRISIL & 4th largest private sector lif
Slide 7: Lending industry opportunity
Lending industry opportunity India vs. Advanced Economies Banking Assets ($ Bn) India vs. Advanced Economies - Consumer Debt/GDP (%) United States 15304 United States 91% Japan 13560 Japan 78% China 9289 China 12% United Kingdom United Kingdom Germany Germany France France Spain Spain Italy Italy Ca
Slide 8: Executive summary: Bajaj Finance
Bajaj • 26 year old non bank with a demonstrated track record of profitability. Finance • Focused on Consumer, SME and Commercial lines of businesses spread across eleven product lines. • Strategic business unit organization design supported by horizontal common utility support functions to drive do
Slide 9: SME and Commercial businesses
SME • Focused on high net worth SMEs with an average annual Small Business Loans Against businesses sales of ` 25 crores with established financials & Loans * Property * FY13 : FY13 : demonstrated borrowing track records. • Offer a range of working capital & growth capital products. BFL : BFL : 81%
Slide 10: Products & key characteristics
Products & key characteristics Consumer SME Commercial High Consumer Durable 36-180M Financing Mortgage Construction LAP & HL Equipment Finance Lifestyle Financing SME Business 2 Wheeler & 3 Loan Against Infrastructure Commercial Medium Wheeler Finance Securities Finance 12-36M Personal Loan Cross s
Slide 11: Strong distribution reach
Strong distribution reach Geographic Presence Business Line FY10 FY11 FY12 FY13 FY14* Sales Finance 79 79 82 91 112 2W - Hubs 54 54 54 54 54 2W - Spokes 150 150 150 150 150 SME Businesses 15 23 31 43 46 SME Spokes - - - 14 34 Rural Branches - - - - 14 Rural Spokes - - - - 53 Distribution Business Li
Slide 12: Management discussion
Management discussion Q3 FY14 for the company demonstrated a strong volume momentum, strong credit performance across Consumer and SME product lines and robust profitability. The company maintained a healthy growth momentum. The company continued to maintain a cautious view on its Commercial busines
Slide 13: Management discussion (continued)
Interest cost for the company continues to remain significantly lower amongst NBFC peers. Borrowing mix of BFL between banks & money markets has shifted from 55:45 to 60:40 due to weak money markets. In order to tide over situations similar to the July liquidity crisis, company has created Liquidity
Slide 14: EMI Card franchise
EMI Card franchise What is EMI Card Progress till date 8000 17.5 7000 16.5 • EMI Card refers to Existing Member Identification 15.5 6000 Card. 14.5 5000 13.5 • The EMI card can be used to purchase consumer 4000 12.5 durables & lifestyle products, by availing a loan from 3000 11.5 2000 BFL without an
Slide 15: Product Per Customer
Product Per Customer Product per Customer (PPC) is a measure of cumulative products bought by a customer over his/her lifetime. Retail SME Products PPC PPC PPC PPC Products PPC PPC PPC PPC offered Benchmark (12 MOB) (18 MOB) (24 MOB) offered Benchmark (12 MOB) (18 MOB) (24 MOB) 11 3 1.84* 1.98* 2.16
Slide 16: Product Per Customer
Product Per Customer Retail Disbursed Value (` Crore) Fresh v/s Repeat Mix Product Per Customer Repeat Sourcing Fresh Sourcing Loan Product Fee Product 1382 1904 1906 1464 1542 2551 2614 1819 1903 2601 2708 2.16 1.98 1.84 0.74 52% 51% 53% 50% 51% 0.65 56% 0.60 1.33 1.42 50% 1.24 48% 44% 49% 47% 49%
Slide 17: Key performance highlights for the Quarter
Key performance highlights for the Quarter • Profit after tax for Q3 FY14 21% to `194 Crores from `160 Crores in Q3 FY13. Without the accelerated provisioning of `21 Crores made to strengthen our provisioning framework, the profit after tax would have been at `208 Crores, a growth of 30%. • Assets
Slide 18: Summary financial statement
Summary financial statement ` in Crores Financials snapshot YoY 9M'14 9M'13 9M on 9M FY'13 FY12 Deployments 7,532 5,200 45% 18,981 14,261 33% 19,367 15,797 Assets under finance (AUF) 21,526 16,283 32% 21,526 16,283 32% 16,744 12,283 Assets under management (AUM) 22,461 16,844 33% 22,461 16,844 33% 1
Slide 19: Financial performance trends Q3 FY14
Financial performance trends Q3 FY14 15% YoY Disbursement (` Crore) 45% YoY 2 Wheelers Others 969 962 833 622 690 775 7,532 614 803 442 535 5,200 6,250 5,106 5,199 219 180 167 155 187 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 AUM (` Crore) 33% YoY Revenue ( ` Crore) 31% YoY 22,
Slide 20: Financial performance trends Q3 FY14
Financial performance trends Q3 FY14 Net Interest Income (NII) (` Crore) 33% YoY Operating expenses % of NII 48% 601 672 582 507 517 45% 45% 44% 43% Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Loan loss provision (` Crore) Net NPA & Provisioning coverage Net NPA (%) Coverage (%) 83%
Slide 21: Financial performance trends Q3 FY14
Financial performance trends Q3 FY14 Pre tax profit (` Crore) 24% YoY Capital adequacy ratio Tier-I Tier-II 22.0% 21.5% 20.9% 19.5% 17.5% 3.3% 3.4% 3.2% 3.0% 2.9% 295 267 253 18.7% 18.1% 237 238 17.7% 14.5% 16.5% Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Q3'13 Q4'13 Q1'14 Q2'14 Q3'14 Earnings per share - Basic
Slide 22: Credit Quality of Bajaj Finance customers across products
Credit Quality of Bajaj Finance customers across products Portfolio composition Consumer durable loan portfolio * Two & Three wheeler loan portfolio 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 2.50% 14.00% 86.92% 97.91% 97.85% 88.37%
Slide 23: Credit Quality of Bajaj Finance customers across products
Credit Quality of Bajaj Finance customers across products Portfolio composition Loan against property portfolio Home loan portfolio 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 0.45% 99.58% 0.40% 99.63% 0.40% 99.63% 0.35% 0.35% 0.30% 9
Slide 24: NPA Provisioning Standards
NPA Provisioning Standards Bajaj Finance provides requirement of 0.25%. Consumer Finance provision SME Finance Commercial Lending coverage provision coverage provision coverage Consumer Durables : Home Loan / Loan against Construction Equipment 3-5 Bucket - 75% Property : Finance : Above 5 - 100% 4-
Slide 25: Disclaimer
Disclaimer This presentation has been prepared by Bajaj Finance Limited (the solely for your information and for your use. This presentation is for information purposes only without specific regards to specific objectives, financial situations or needs of any particular person and does not constitut
Slide 26: Thank you
Bajaj Finance Limited Q3 FY14 Presentation Thank you 15th January 2014 26