Aavas Financiers Ltd. · NSE:AAVAS
Aavas Financiers — Q1 FY2022 Earnings Presentation
34 slides from Aavas Financiers's earnings presentation, Jul 29, 2021
Slide 1: Cover letter to stock exchanges
A gvqs FINANCIERS LTD SAPNE AAPKE, SAATH HAMAARA Ref. No. AAVAS/SEC/2021-22/385 Date: July 29, 2021 To, To, The National Stock Exchange of India Limited BSE Limited The Listing Department Dept, of Corporate Services Exchange Plaza, Phiroze Jeejeebhoy Towers, Bandra Kurla Complex, Dalai Street, Fort,
Slide 2: Investor Presentation - 3M FY22
AAVAS FINANCIERS LIMITED Investor Presentation - 3M FY22
Slide 3: Safe Harbor
Safe Harbor This presentation and the accompanying slides (the "Presentation"), which have been prepared by Aavas Financiers Ltd. (the "Company"), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase or subscribe for any securit
Slide 4: Our Background
Our Background Commenced operations in 2011 Regulated by Reserve Bank of India ("RBI") from Jaipur, Rajasthan Supervised by National Housing Bank ("NHB") Currently being run by professional management team backed by Recognized by NHB for refinance marquee private equity players facility Kedaara Capi
Slide 5: Our Pillars of Strength
Our Pillars of Strength y Experienced Board of Directors y Professional Management Team y In-house Execution Model y Technology and Data Analytics y Improving Credit Ratings y Diversified Shareholding Base
Slide 6: Experienced Board of Directors
Experienced Board of Directors Sandeep Tandon Soumya Rajan Kalpana Iyer Chairman & Independent Director Independent Director Independent Director Qualifications: Bachelor's in Electrical Qualifications: Bachelor's in Mathematics & Qualifications: Chartered Accountant Engineering from University of S
Slide 7: Professional Management Team
Professional Management Team Sushil Kumar Agarwal - Managing Director & CEO Ghanshyam Rawat - Chief Financial Officer • 20+ years of experience in retail financial services • Experience in financial services & allied sectors • Prior associated with Kotak Mahindra Prime, ICICI Bank & Au Small • Prior
Slide 8: In-house Execution Model
In-house Execution Model 1. Reduction in average TAT (days) In-house execution model - Replicated across the states Turn around time is a key metric for employee incentives Lead generation and 21.1 Risk management Collections sourcing <U 13.1 E ■ Focused approach to directly ■ In-house underwriting
Slide 9: Technology and Data Analytics
Technology and Data Analytics Lead Generation Underwriting Operations Collections ■ Majority of the leads ■ Platform integration ■ E-disbursement & E- ■ Route optimization for are logged in through with credit bureaus repayment facility at all collection personnel the sourcing app ■ Quarterly scrub
Slide 10: Improving Credit Ratings
Improving Credit Ratings Long-Term Credit Rating Short-Term Credit Rating Reaffirmed f \ CARE ICRA ICRA Jun-21 A1+ A A -/ A A -/ Jun-21 Jun-21 Stable Stable CARE Jun-21 A1+ A/ INDIA RATINGS Mar-17 A+ / Mar-16 h Stable Stable Jun-21 A1+ V_________________ > ^________________________ > 9
Slide 11: Diversified Shareholding Base
Diversified Shareholding Base Shareholding Pattern as on Top Institutional Shareholders as on 30th June 2021 30th June 2021 Investor Details % Holding Others, 3.52% Capital GroupA 8.17 Wasatch Global AdvisorsA 5.01 Nomura Asset Management 3.49 Kotak Mahindra Asset M anagement^ 2.70 FII, 32.13% UTI A
Slide 12: Size of Opportunity
Size of Opportunity Indian Housing Finance Housing Market (^ Trn) Market Size ^ 22.1 Trn (as on Dec-20) 21.1 22.1 YTD Growth +5% (as on Dec-20 vs. Mar-20) Banks - 6%, HFCs & NBFCs - 3% Market Share Banks - 67% HFCs & NBFCs -33% (as on Dec-20) Mortgage Penetration (%) Affordable HFCs Affordable segme
Slide 13: Measures from Government and Regulator
Measures from Government and Regulator Continued Pause in Policy Rate RBI's MPC voted unanimously to maintain status-quo (repo rate @ 4%) even in the June meeting and continued with its accommodative stance for as long as necessary to revive growth on a durable & sustainable basis. Resolution Framew
Slide 14: Financial Performance
Financial Performance y/ Key Business Parameters Y Geographical Distribution Y Spreads and Margins ^ Asset Quality y Liability Franchise */ Key Ratios
Slide 15: Performance Highlights
Performance Highlights AUM (K Mn) Disbursement (K Mn) Gross Stage 3 (%) 96,156 79,353 Average AmountAper Active Loan Account as on Jun-21 ^ 0.84 Mn Jun-20 Jun-21 3MFY21 3MFY22 Jun-20 Jun-21 PAT* (K Mn) NIM (%) ROA (%) Average AmountAper Disbursed <+78bg Loan Account in 3MFY22 ^ 0.84 Mn 501 3MFY21 3M
Slide 16: Healthy Business Growth
Healthy Business Growth AUM (^ Mn) Disbursements (^ Mn) PAT* (^ Mn) Data as per Ind-AS * PAT includes Other Comprehensive Income 15
Slide 17: AUM Break-up
AUM Break-up Agvqs Product Category Occupation Category Customer Category ATS : ^ 0.83 Mn ATS : ^ 0.66 Mn ATS : ^ 0.86 Mn 0.3% ATS : ^ 7.49 Mn 30-Jun-20 ATS : ^ 0.91 Mn ATS : ^ 0.81 Mn ATS : ^ 0.67 Mn ATS : ^ 0.87 Mn ATS : ^ 0.84 Mn 0.2% ATS : ^ 7.24 Mn 30-Jun-21 ATS : ^ 0.93 Mn ATS : ^ 0.83 Mn Reta
Slide 18: Disbursement Break-up - Product Category
Disbursement Break-up - Product Category 3M FY21 3M FY22 ATS : ^ 0.64 Mn ATS : ^ 0.41 Mn ATS : ^ 0.98 Mn ATS : ^ 1.05 Mn Disbursement include 7.3% of MSME Loans classified under Other Mortgage Loans Disbursement include 15.0% of MSME Loans classified under Other Mortgage Loans Home Loan Other Mortga
Slide 19: Geographical Distribution
Geographical Distribution State Branches Operations Commenced in Rajasthan 96 2012 Maharashtra 44 2012 Gujarat 40 2012 Madhya Pradesh 40 2013 Delhi 6A 2013 Haryana & Punjab 16 2017 Chhattisgarh 7 2017 Uttar Pradesh 21 2018 Uttarakhand 9 2018 Himachal Pradesh 4 2020 Orissa 1 2021 Total 284 Data as on
Slide 20: Yields, COB and Spreads
Yields (%) • COB (%) Spreads (%) Yields (%) • COB (%) Spreads (%) 18.13% 13.78% 13.74% 13.63% 13.62% 13.52% 13.42% 13.16% 12.99% 8.75% 8.68% 8.44% 8.10% 7.90% 7.68% Consistent Spreads nn n n n n n i 5.52% 5.62% 5.74% 5.76% 5.74% 5.85% 5.76% 5.03% 5.06% 5.19% nn 5.08% 5.22% 5.36% 5.010% 5.01% 5.19% 5
Slide 21: Margin and Cost Efficiency
Margin and Cost Efficiency OpEx (%) NIM (%) ROA (%) 4.03% 4.05% 3.75% 8 . 10% 8.69% 8.66% 8.16% 3.17% 3.38% 3.28% 3 42% 3.38% 3MFY20 H1FY20 9MFY20 FY20 3MFY20 H1FY20 9MFY20 FY20 3MFY20 H1FY20 9MFY20 FY20 7.42% 7.71% 3.22% 3.49% 6.15% 6.82% 2.55% 2.89% 2.62% 2.80% 2.82% 3 .01% 3MFY21 H1FY21 9MFY21 FY
Slide 22: Asset Quality
Asset Quality Gross Stage 3 (%) Net Stage 3 (%) 0.86% 0.72% Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Mar-21 Jun-21 1+DPD (%) Segment-wise Gross Stage 3 (%) Jun-20 Jun-21 12.67% Dec-19 Mar-20 Jun-20 Sep-20 Dec-20 Mar-21 Jun-21 Home Loan Other Mortgage Loan Stage 3 Classification as per Ind-AS
Slide 23: Robust Liability Franchise
Robust Liability Franchise Diversified Funding Mix Loan Assets & Borrowings (K Mn) As on Jun-21 As on Jun-21 29 Lenders ■ Terms Loans Floating Fixed Equity Diversified Mix ■ Assignment No exposure 96,156 96,156 to Commercial Papers ■ NHB Refinancing Incremental Q1 FY22 borrowings ■ NCDs ^ 6,920 Mn f
Slide 24: ALM Surplus
ALM Surplus Surplus Management* Mn) Average tenor of outstanding borrowing (months) As on Jun-21 143 123 Mar-17 Assets Liabilities Surplus * Data as per Ind-AS 23
Slide 25: Comfortable Liquidity Position
Comfortable Liquidity Position Particulars (^ Mn) As on Jun-21 Cash & Cash Equivalents 11,080 High Quality Un-availed CC Limits 1,320 Liquidity of Documented & Un-availed Sanctions from NHB 4,550 ^ 16,950 Mn Documented & Un-availed Sanctions from other Banks 6,600 Total Liquidity Position 23,550 Par
Slide 26: Net Securitization Volume
Net Securitization Volume ^ 5,496 Mn Nil ^ 6,802 Mn ^ 6,647 Mn 2,992 25
Slide 27: Key Financial Ratios
Key Financial Ratios ROE (%) Book Value Per Share (^) 9.74% 9.43% 9.84% 241.1 Jun-19 Jun-20 Jun-21 3MFY20 3MFY21 3MFY22 Capital Adequacy Ratio (%) Earning Per Share* (^) Tier I Tier II 61.00% 53.73% 52.70% Jun-19 Jun-20 Jun-21 3MFY20 3MFY21 3MFY22 Data of Capital Adequacy Ratio is as per IGAAP for J
Slide 28: Annexures
Annexures Quarterly Profit & Loss Statement Balance Sheet PAT Reconciliation ECL Provisioning Networth Reconciliation 27
Slide 29: Quarterly Profit & Loss Statement
Quarterly Profit & Loss Statement Particulars (^ Mn ) Q1FY22 Q1FY21 Interest Income on Loans (incl. Processing Fee) 2,668.1 2,250.9 18.5% Interest Income on Fixed Deposits 142.1 190.1 Reversal Income on Earlier Assigned Loans (179.8) (154.5) Upfronting Income on Fresh Assigned Loans Non-Interest Inc
Slide 30: Balance Sheet
Balance Sheet Particulars Mn ) 30-Jun-21 31-Mar-21 Sources of Funds Share Capital 785.1 785.0 Reserves & Surplus 23,895.9 23,229.0 Borrowings 64,859.4 63,454.2 Deferred Tax Liability (Net) 198.3 285.2 Other Liabilities & Provisions 2,085.0 1,847.0 Total 91,823.8 89,600.5 Application of Funds Loan As
Slide 31: PAT Reconciliation
PAT Reconciliation Particulars (^ Mn ) Q1 FY22 Q1FY21 Y-o-Y Net Profit as per IGAAP 713.0 601.2 18.6% Add / (Less): Adjustments as per IndAS on account of: Adoption of effective interest rate (EIR) for amortisation of Income and expenses - financial assets at amortised cost / net interest on credit
Slide 32: ECL Provisions
ECL Provisions Particulars (^ M n) 30-Jun-21 31-Mar-21 30-Jun-20 During Q1 FY22, resolution plan has been implemented Gross Stage 3 894.2 739.1 294.8 for certain borrower accounts as per RBI's Resolution % portfolio in Stage 3 1.14% 0.98% 0.46% Framework 2.0 dated 05-May-21. As a matter of ECL Provi
Slide 33: Networth Reconciliation
Networth Reconciliation Particulars Mn ) 30-Jun-21 Net worth as per previous GAAP 23,235.0 Adjustments increasing/(decreasing) net worth as reported under previous GAAP: Adoption of EIR for amortisation of Income and expenses - financial assets at amortised cost / net interest on credit impaired loa
Slide 34: Contact Us
Contact Us Aavas Financiers Limited (Formerly known as Au HOUSING FINANCE LIMITED) CIN:L65922RJ2011PLC034297 Mr. Himanshu Agrawal investorrelations@aavas.in www.aavas.in 33