Axis Bank Limited · NSE:AXISBANK
Axis Bank — FY2009 Earnings Presentation
34 slides from Axis Bank's earnings presentation, 2009
Slide 1: FY 2008-09 Annual Results
FY 2008-09 Annual Results INVESTOR PRESENTATION 1
Slide 2: Performance Highlights
PERFORMANCE HIGHLIGHTS Q4 FY09 Net Profit 61 % yoy 69 % yoy Net Interest Income 25 % yoy 43 % yoy Fee Income 42 % yoy 64 % yoy Operating Revenue 36 % yoy 50 % yoy Operating Profit 58 % yoy 67 % yoy Net Interest Margin 3.37 % 3.33 % Cost of Funds 6.64 % 6.50 % 2
Slide 3: Interpretation of Q4 Performance
INTERPRETATION OF Q4 PERFORMANCE • Rapid Growth in the Bank’s core businesses – Total Net Advances grow 37% yoy to Rs. 81,557 crores – Total Investments grow 37% yoy to Rs. 46,330 crores – Total Assets register a 35% yoy growth, rising to Rs. 1,47,722 crores – Fees grow by 42% yoy, rising to Rs. 664
Slide 4: Profitability
PROFITABILITY Sustained Growth: Robust Core Revenues Q4 (FY09 vs FY08) FY09 vs FY08 6,583 1,878 6,209 1,712 1,385 1,340 4,381 4,127 3,351 972 678 581 1,815 1,972 361 1,071 Net Profit Core Operating Core Net Profit Core Operating Core Operating Revenue Operating Operating Revenue Operating Profit Rev
Slide 5: Consistent Net Profit Growth
CONSISTENT NET PROFIT GROWTH Over 30% yoy growth in Net Profit in 35 out of the last 37 quarters Over 60% yoy growth in Net Profit in each of the last 7 quarters Quarterly Net Profits (FY 1999-2000 to FY 2008-09) 581.5 500.9 402.9 361.4 330.1 306.8 227.8 211.9 174.9 184.6 141.9 151.7 131.7 120.6 109
Slide 6: Net Interest Margins & Cost of Funds
NET INTEREST MARGINS & COST OF FUNDS Net Interest Margins (%) Cost Of Funds (%) (Q4 FY08 to Q4 FY09) (Q4 FY08 to Q4 FY09) 6.91 6.23 5.82 6.64 3.93 3.37 6.11 3.35 3.51 3.12 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY09 NIMs in the last 5 years (%): FY 05: 2.90 FY 06: 2.85 FY 0
Slide 7: Growing Net Interest Income
GROWING NET INTEREST INCOME Net Interest Income (FY09 vs FY08) 3,686 NIIs in the last 5 years (Rs. crores) • FY 05 : 731 2,585 • FY 06 : 1,078 • FY 07 : 1,468 • FY 08 : 2,585 • FY 09 : 3,686 1,033 828 CAGR (5 years) : 45% Q4 FY ↑ 25 % YOY ↑ 43 % YOY FY 08 FY 09 Rs. crores 7
Slide 8: Growing Demand Deposits
GROWING DEMAND DEPOSITS YoY growth in daily average demand and term deposits (%) Deposits Q4 FY09 FY09 Savings 32 42 Current 7 24 Total Demand 21 34 Term Deposits 59 60 Profile of Deposits (31st March ‘09 vs 31st March ’08) 50,644 Demand deposits ↑ 27% YOY (43%) 40,027 (46%) 66,730 47,599 Term depos
Slide 9: Fees
FEES Q4 (FY09 vs FY08) FY09 vs FY08 2,447 Fees in the last 5 years (Rs crores): FY 05 : 366 1,495 FY 06 : 558 FY 07 : 890 FY 08 : 1,495 664 FY 09 : 2,447 468 CAGR (5 years) : 65% Note: Earnings from customer forex transactions have been shown as fees (instead of trading profit) from Q2 onwards ↑ 42
Slide 10: Fee Income Composition
FEE INCOME COMPOSITION Fees have grown very strongly in all businesses 771 553 446 FY08 FY 09 347 Rs. crores 368 251 304 211 211 209 129 141 Large & Mid Treasury Agri & SME Business Banking Capital Markets Retail Banking Corporate Credit Banking ↑ 78% YOY ↑ 65% YOY ↑ 64% YOY ↑ 46% YOY ↑ 160% YOY ↑ 3
Slide 11: Trading Profits
TRADING PROFITS Constitute 8.85% of Operating Revenue in Q4 Q4 (FY09 vs FY08) 8.85 166 3.22 45 % of Operating Revenue Trading Profit (Rs. crore) FY 08 FY 09 ↑ 272 % YOY Rs. crores 11
Slide 12: Stressed Assets and Net NPA (%)
STRESSED ASSETS AND NET NPA (%) Gross and Net NPAs (Q4 FY08 to Q4 FY09) 1000 0.8 898 788 800 710 0.6 638 600 Net NPAs % at year-end 495 0.47 0.39 (last 5 years): 0.43 0.35 0.4 0.36 400 FY 05: 1.07 326 337 342 327 248 FY 06: 0.75 0.2 200 FY 07: 0.61 FY 08: 0.36 0 0.0 Q4FY08 Q1FY09 Q2FY09 Q3FY09 Q4FY0
Slide 13: Business Overview
BUSINESS OVERVIEW 13 A
Slide 14: Network
NETWORK Increasing Reach 3,595 Branch Demographics: Branches Extn. Counters Metro 273 6 2,764 Urban 324 2 2,341 Semi-urban 186 0 Rural 44 0 1,891 Total 827 8 1,599 1,244 835 822 671 515 561 450 332 405 339 258 192 252 80 117 190 Centres covered Branches + Extn. Counters ATMs Mar'03 Mar'04 Mar'05 Mar
Slide 15: Large & Mid-Corporate Banking
LARGE & MID-CORPORATE BANKING • Focus on quality of credit assets with stress on corporates having – Global competitive advantage in their businesses – Good corporate governance and management practices • Business Segments – Large Corporates – Mid Corporates – Structured Products • Rigorous and regu
Slide 16: Distribution of Ratings: Large & Mid Corporate
DISTRIBUTION OF RATINGS: LARGE & MID CORPORATE 81% of corporate advances have rating of at least ‘A’ as at March’09 1 7 8 7 5 AAA 22 20 18 19 22 AA A 58 55 56 54 58 BBB 15 14 13 15 16 4 4 3 3 3 <B B B and U nr at ed M ar ' 0 8 Jun' 0 8 Sep t ' 0 8 D ec' 0 8 M ar ' 0 9 16
Slide 17: SME & Agri Business
SME & AGRI BUSINESS SME and Agricultural advances (March ’08 vs March ’09) 16,077 11,536 March ‘08 8,217 March ‘09 5,507 SME Advances Rs. crores Agricultural Advances ↑ 39 % YOY ↑ 49 % YOY SME centres 20 24 Agri clusters 36 46 • Specialised SME Centres for SME • Specialised Clusters for Agricultural
Slide 18: Distribution of Ratings: SME
DISTRIBUTION OF RATINGS: SME 77% of SME advances have rating of at least ‘SME3’ as at March’09 as against 72% as at end March’08 1 2 1 1 SM E 1 1 9 11 14 11 12 SM E 2 62 65 63 67 64 SM E 3 SM E 4 19 13 15 14 15 9 9 7 7 8 SM E 5- 8 Mar'08 J u n' 0 8 S e pt ' 0 8 Dec' 08 Mar'09 18
Slide 19: Top Sector Exposures
TOP SECTOR EXPOSURES Across Large & Mid Corporates, SME and Corporate Agri businesses Rank Sectors % Exposure (as on 31 March 2009) Total Fund Based Non-Fund Based 1 Infrastructure* 12.43 7.87 22.58 2 Financial Companies** 8.57 10.34 4.63 3 Metal & Metal Products 8.28 6.64 11.93 4 Shipping & Logisti
Slide 20: Business Banking: Cash Management Services
BUSINESS BANKING Cash Management Services Throughput and number of clients (FY09 vs FY08) 360,318 1,083,004 4,852 Mar‘08 Mar’09 746,286 3,193 212,394 FY08 FY09 Q4 ‘08 Q4 ‘09 Throughput (Rs. crores) Throughput (Rs. crores) CMS Clients ↑ 70 % YOY ↑ 45% YOY ↑ 52% YOY • Collection of Central Government
Slide 21: Business Banking: Current Accounts Growth
BUSINESS BANKING Current Accounts Growth Current account deposits (March ’09 vs March ’08) 24,822 Current Account deposits in the last 5 20,045 years (Rs crores) March ‘08 March ‘09 Mar’05 : 7,155 Rs. crores Mar’06 : 7,970 Mar’07 : 11,304 Mar’08 : 20,045 Mar’09 : 24,822 ↑ 24 % YOY CAGR (5 years) : 3
Slide 22: Treasury
TREASURY Q4 (FY09 vs FY08) FY09 vs FY08 113 225 295,776 19 17 85,736 159,165 86 55,368 9 8 6 33 39 30 (0.4) Forex Forex trading SLR & Derivatives Forex Forex SLR & Derivatives turnover Money trading turnover trading Money trading market market trading trading ↑ 55 % YOY ↑ 103 % YOY ↑ 504 % YOY ↓ 22
Slide 23: Capital Markets
CAPITAL MARKETS Q4 (FY09 vs FY08) FY09 vs FY08 27,206 69,062 57,327 FY 08 17,210 FY 09 Rs. crores Placements & Syndications Placement & Syndications ↑ 58% YOY ↑ 20% YOY • A dominant player in Placement and Syndication of debt issues • Ranked No.1 in the Bloomberg league table for ‘India Domestic Bon
Slide 24: Savings Bank Growth
SAVINGS BANK GROWTH Retail and SB Deposits (Mar ’09 vs Mar ’08) 42,501 Mar ‘08 Mar ‘09 SB deposits in the last 5 years Rs. crores 31,431 (Rs crores) 25,822 19,982 Mar’05 : 4,891 Mar’06 : 8,066 Mar’07 : 12,126 Mar’08 : 19,982 Mar’09 : 25,822 SB Deposits Retail Deposits ↑29 % YOY ↑ 35 % YOY CAGR (5 ye
Slide 25: Third Party Products Business
THIRD PARTY PRODUCTS BUSINESS Personal Investment Products - Fees • Focus on cross-selling to existing 255 customers to generate fee income • Third-party products sold include: 183 FY 08 Mutual Funds, Insurance, On-Line FY 09 Broking, Portfolio Management 87 Rs. crores 82 Services (Non-discretionary
Slide 26: Retail Assets
RETAIL ASSETS Retail Assets portfolio (March ’09 vs March ’08) 16,052 992,286 13,592 899,594 • Retail Assets grew by 18% yoy • Retail Assets constitute 20% of the Bank’s total advances, as compared to 23% as at end March’ 08 • Growth driven through Retail Asset Centres (RACs) Rs. Crores No. of Accou
Slide 27: Composition of Retail Assets
COMPOSITION OF RETAIL ASSETS Product-wise composition of Retail Assets portfolio (March ’09) Personal loans 12% Cards 4% Non-Schematic 5% Commercial vehicles Auto loans 3% 14% Passenger cars 11% 2-Wheelers 0.03% Housing loans 65% 27
Slide 28: Cards Business
CARDS BUSINESS Cards fee income (FY09 vs FY08) 178 140 47 50 Q4 FY FY 08 FY 09 ↑ 7% YOY ↑ 27% YOY Rs. crores • Issuance – Over 533,000 Credit Cards in force till end March ‘09 – 3rd largest Debit Card base in the country – 1st Indian Bank to launch Travel Currency Cards in 9 currencies -US$, Euro, G
Slide 29: ATM Channel Migration
ATM CHANNEL MIGRATION Over 95% of SB account cash withdrawals occur on ATMs 118 4,828 243 87 4,124 203 Cardbase (in lakhs) Monthly cash withdrawals No. of monthly (Rs. crore) transactions (in lakhs) ↑ 36% yoy ↑ 17% yoy ↑ 20% yoy Mar ‘08 Mar ‘09 • Pioneer in ATM sharing arrangements • Value added ser
Slide 30: International Presence
INTERNATIONAL PRESENCE • Branches at Singapore, Hong Kong and DIFC, Dubai • Representative offices at Shanghai and Dubai • Total assets overseas amounted to US$ 2.30 billion as compared to US$ 1.66 billion as at end March’08, a growth of 39% yoy • Corporate Banking, Trade Finance products, Debt Synd
Slide 31: Shareholder Returns
SHAREHOLDER RETURNS 284.50 245.14 • Annualised ROE of 24.38% in Q4 FY09, as compared to 21.24% in Q3 FY09 and 17.28% in Q4 FY08 • ROA of 1.68% in Q4 FY09, as compared to 1.48% in Q3 FY09 and 1.43% in Q4 FY08 120.50 103.06 87.95 25.85 21.84 18.44 19.93 16.09 1.21 1.18 1.10 1.24 1.44 Book Value per Sh
Slide 32: Shareholding
SHAREHOLDING Shareholding pattern (Mar ’09) • Share Capital - Rs. 359.01 crores UTI-I 27.08 • Net Worth - Rs. 9,757.45 crores Others 39.13 • Book Value per share - Rs. 284.50 • Market Price as on 17/04/09 - Rs. 503.25 LIC 10.36 • Market Cap as on 17/04/09 - Rs. 18,067 FIIs 23.43 crores (US $ 3.63 bi
Slide 33: Safe Harbor
SAFE HARBOR Except for the historical information contained herein, statements in this release which contain words or phrases such as “will”, “aim”, “will likely result”, “would”, “believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”, “contemplate”, “seek to”, “futu
Slide 34: Thank You
The strongest Indian Best Private Sector Best New Private FE best banks Business India Bank and 5th in Asia- Bank 2008 - NDTV sector bank in award ’07 – Best Awards 2007 – Pacific - Asian Banker Profit Business India (2007-08) Private Sector Best Bank in India 300 - A survey of Asia- Leadership Awar