Bajaj Finserv Limited · NSE:BAJAJFINSV
Bajaj Finserv — Q3 FY21 Earnings Presentation
45 slides from Bajaj Finserv's earnings presentation, Jan 20, 2021
Slide 1: Regulation 30 cover letter to BSE and NSE
20 January 2021 To To Corporate Relations Department. Corporate Listing Department. BSE Limited National Stock Exchange of India Ltd 1st Floor, New Trading Ring, Exchange Plaza, 5th Floor Rotunda Building, P J Tower, Plot.No.C-1, GBlock, Dalal Street, Mumbai 400 001 Bandra-Kurla Complex, Sandra (Eas
Slide 2: Bajaj Finserv Limited Investor Presentation – Q3 FY21
BAJAJ FINSERV LIMITED Investor Presentation – Q3 FY21* * Financial year 2020-21
Slide 3: Bajaj Group Structure
Bajaj Group Structure Bajaj Holdings & Investment Limited (BHIL) 51% 33.43%@ 39.16%@ Maharashtra Scooters Bajaj Auto Limited Bajaj Finserv Limited Limited 52.74%@ 74% 74% Bajaj Finance Limited Bajaj Allianz General Insurance Bajaj Allianz Life Insurance • Set up in 1987: BFL is a 33 year old Company
Slide 4: Bajaj Finserv's Vision – A diversified financial services group
Bajaj Finserv’s Vision – A diversified financial services group with a pan-India presence Life cycle needs of Investment/ Asset Asset Family Income Individual & Wealth acquisition protection Protection protection SME management customers Lending General Insurance Health Insurance Life Insurance Life
Slide 5: A resilient diversified financial services business
Bajaj Finserv – A resilient diversified financial services business BFL’s robust liquidity management framework has ensured that it has liquidity to meet its debt service obligations, Bajaj Finance despite it having to offer repayment moratoriums to its Limited customers. BFL’s excellent risk manage
Slide 6: Bajaj Finserv performance highlights – Q3 FY21
Bajaj Finserv performance highlights – Q3 FY21 All Figures in Rs Million Performance Highlights of Q3 FY21 over Q3 FY20 (Ind AS) 159,607 12,900 353,269 36,120 CY 10% 15% 13% 8% PY 145,607 11,256 312,453 33,354 Total Revenue PAT* Net Worth Net Worth (Consolidated) (Consolidated) (Consolidated) (Stand
Slide 7: Consolidated profit components – Q3 FY21
Consolidated profit components – Q3 FY21 All Figures in Rs Million Consolidated profit components for Q3 FY21 (Ind AS) #Net Positive impact on PAT on account of MTM Gains on BAGIC & BALIC Investments - Intercompany Rs. 3,840 Mn (post-tax) adjustments Bajaj Finserv- Standalone (64) Others 84 Life 12,
Slide 8: 9M FY21 Highlights
9M FY21 Highlights All Figures in Rs Million Highlights of Group Companies BAJAJ FINSERV# 9M FY21 9M FY20 Growth BAJAJ FINANCE # 9M FY21 9M FY20 Growth Total Revenue 452,043 410,572 10% AUM 1,435,502 1,450,917 -1% Net worth 353,269 312,453 13% Total Income 198,281 191,548 4% PAT 34,914 31,747 10% PA
Slide 9: Bajaj Finance Limited
BAJAJ FINSERV Bajaj Finance Limited
Slide 10: BFL – Key Strategic Differentiators
BFL – KEY STRATEGIC DIFFERENTIATORS STRATEGY • Diversified financial services strategy seeking to optimise risk and profit, to deliver a sustainable business model and deliver a superior ROE and ROA • Focused on continuous innovation to transform customer experience to create growth opportunities. D
Slide 11: BFL: Business Segments
BFL : Business Segments BAJAJ FINANCE Consumer SME Commercial Rural • Largest consumer • Focused on affluent • Wholesale Lending • Unique hub-and-spoke electronics, digital SMEs with an average products covering short, model in 1,604 locations products & furniture annual sales of around medium and l
Slide 12: BFL's Summary on COVID-19
BFL’s – Summary on COVID-19 Q3 was marked by granular business recovery, significant improvement in risk metrics and tracking implementation on business transformation plan. AUM growth is back across all the businesses except auto-finance. With incremental growth being seen every month, most bus
Slide 13: BFL – Key Highlights
BFL – Key Highlights Q3 2020-21 AUM experienced a de-growth by 1% YoY and stands at Rs. 143,550 crore. Core AUM growth in Q3 FY21 was approx. Rs. 8,000 crore (adjusted for IPO receivable of Rs. 987 crore and higher ECL of Rs. 520 crore) as compared to Rs. 9,559 crore in Q3 FY20 New loans booked
Slide 14: BFL – Key Highlights (Subsidiaries)
BFL – Key Highlights Q3 2020-21 Subsidiaries (included in BFL Consolidated Performance) Bajaj Housing Finance Ltd (BHFL) AUM grew by 18% to Rs. 35,492 crore as of 31 December 2020 from Rs. 30,035 crore as of 31 December 2019. BHFL’s Net Interest Income for Q3 FY21 grew by 15% to Rs. 329 crore fr
Slide 15: BFL – Q3 FY21 highlights
BFL – Q3 FY21 highlights All Figures in Rs Million Performance Highlights of Q3 FY21 over Q3 FY20 (Ind AS) CY 1,379,199 66,585 11,460 -1% -5% -29% PY 1,395,609 70,239 16,141 Book Size Total Income Profit After Tax CY 0.9% 3.3% Borrowing mix is not excessively dependent on banks. (Mix of 35:42:19:4 b
Slide 16: BFL: Book Size and Revenue
BFL : Book Size and Revenue All Figures in Rs Million FY20 Book Size Q3 FY21 FY20 Total Income Increase of 26% de-growth of 1% Increase of 43% 263,857 1,413,760 1,395,609 1,379,199 1,125,128 185,002 Q3 FY21 de-growth of 5% 70,239 66,585 FY19 FY20 Q3 FY20 Q3 FY21 FY19 FY20 Q3 FY20 Q3 FY21 Net Interes
Slide 17: BFL: Loan Loss Provision and Operating Expenses
BFL : Loan Loss Provision and Operating Expenses All Figures in Rs Million Loss Provision and Net NPA% Loan losses and provisions (expected credit loss) for 39,295 Q3 FY21 was Rs. 1,352 Cr as against Rs. 831 Cr in Q3 40,000 2.00% FY20. 30,000 Based on Hon’ble Supreme Court’s interim order of not
Slide 18: Bajaj Allianz General Insurance
Bajaj Allianz General Insurance 17
Slide 19: BAGIC – Key Strategic Differentiators
BAGIC – KEY STRATEGIC DIFFERENTIATORS STRATEGY Strive for market share growth in chosen segments through a well-diversified product portfolio and multi-channel distribution supported by prudent underwriting DIFFERENTIATORS Industry leading combined ratios consistently over Strong selection of Risk
Slide 20: BAGIC's Summary on COVID-19
BAGIC’s – Summary on COVID-19 Overall BAGIC growth has been slightly lower than industry but is back on track as seen from sequential recovery from 20% de-growth in Q1 FY20 (attributable to lockdowns) to 11% growth in Q3 FY21; 9M FY21 numbers still at a small de-growth in line with the industry
Slide 21: BAGIC – Key Highlights
BAGIC – Key Highlights Q3 2020-21 BAGIC’s GWP grew by 11 % in Q3 FY21 vs Industry growth of 2% (Private players growth of 8.6%) & 3% de-growth in 9M FY21 vs flat industry growth (Private players growth of 1.7%) Q3 has seen a turnaround in 4W and 2W segments which grew by 9.6% & 13.1% respectivel
Slide 22: BAGIC: Q3 FY21 highlights
BAGIC : Q3 FY21 highlights All Figures in Rs Million Performance Highlights of Q3 FY21 over Q3 FY20 CY 33,923 19,941 18,381 3,300 11% -9% -15% 73% PY 30,550 21,898 21,563 1,906 Gross Written Net Written Premium Net Earned Premium Profit After Tax Premium 4.8% Ex Crop GWP was Rs. 27,376 Mn in Q3 FY
Slide 23: BAGIC: Combined Ratio
BAGIC : Combined Ratio Combined Ratios (Including Motor TP Pool Losses) 103.6% 100.8% 96.7% 96.1% 92.3% FY18 FY19 FY20 Q3 FY20 Q3 FY21 1. Combined Ratios are in accordance with the Master Circular on ‘Preparation of Financial statements of General Insurance Business’ issued by IRDA effective from 1s
Slide 24: BAGIC: Profit after tax and capital efficiency
BAGIC : Profit after tax and capital efficiency All Figures in Rs Million PAT Q3 FY21 PAT growth of 73% 9,988 9,212 7,799 Rs. Million 3,300 1,906 FY18 FY19 FY20 Q3 FY20 Q3 FY21 Total Capital infused is Rs.2,768 Mn BAGIC - Capital Invested - Networth Accumulated profit* 96% of Net worth as on 31 Dec
Slide 25: BAGIC: Consistently amongst top private insurers in Gross Premium
BAGIC : Consistently amongst top 2 private insurers in terms of Gross Premium Industry GDPI Trend (Rs. Bn.) Q3 FY21 GDPI growth of 4% 1,787 1,617 1,415 930 1,056 737 451 467 678 687 730 266 294 185 173 FY18 FY19 FY20 Q3 FY20 Q3 FY21 PSU Private Insurers* Industry BAGIC Premium Trend 128,331 Q3 FY21
Slide 26: BAGIC: Balanced product mix
BAGIC : Balanced product mix Business Mix 7% 9% 11% 9% 5% 13% 13% 19% 20% 19% 15% 14% 15% 16% 13% 10% 14% 10% 9% 11% 7% 6% 5% 7% 5% 44% 44% 47% 42% 41% FY18 FY19 FY20 Q3 FY20 Q3 FY21 Motor (Retail) Health (Retail) Group Health Prop, Liability, Engg Agri (Crop Insurance) Others BAGIC’s ex-crop GWP
Slide 27: BAGIC: Diversified Channel Mix
BAGIC: Diversified Channel Mix Channel Mix 23% 19% 31% 27% 30% 37% 42% 32% 37% 41% 7% 4% 9% 4% 12% 12% 13% 3% 8% 9% 20% 21% 20% 22% 17% FY18 FY19 FY20 Q3 FY20 Q3 FY21 Individual Agents Corporate Agents - Banks Corporate Agents - Others Brokers Direct Business BAGIC has the largest network of banca
Slide 28: BAGIC: Assets Under Management
BAGIC : Assets Under Management AUM (cash and investments) Q3 FY21 Increase of 18% 218,731 BAGIC continues to 187,458 186,039 grow its AUM 172,367 strongly 148,229 Rs. Million Investments are largely in fixed income securities Investment Leverage of 2.97 as on 31 FY18 FY19 FY20 Q3 FY20 Q3 FY21 Dec 2
Slide 29: BAGIC's Digital Penetration
BAGIC’s Digital Penetration Digital Platforms Insta Pay Services Campaigns In addition to agent’s app New express bitly and platform, mediums Apart from Google Pay and links with used Phone – Pe, 48 other prepopulated details Purchase & Renewals services providers being (1.6 Cr+ policies issued,
Slide 30: Bajaj Allianz Life Insurance
Bajaj Allianz Life Insurance 29
Slide 31: BALIC – Key Strategic Differentiators
BALIC - KEY STRATEGIC DIFFERENTIATORS STRATEGY • Continued focus on sustainable and profitable growth by maintaining balanced product mix and investment in retail growth engines • Business construct is to maximize customer benefits while gaining market share in retail space, maintaining shareholder
Slide 32: BALIC's Summary on COVID-19
BALIC’s – Summary on COVID-19 Despite the challenges posed by COVID-19 and the lockdowns, BALIC consistently reported industry beating individual rated new premium growth Consolidation in demand for protection but preference for guarantees continue: With increased term rates and huge uptake in 1
Slide 33: BALIC – Key Highlights
BALIC – Key Highlights Q3 2020-21 Despite COVID-19, BALIC had a market beating Individual Rated New premium (IRNB) growth of 14% in Q3 FY21 vs Industry reporting a de-growth of 9% (Private sector grew by 3%) Individual Rated New premium growth of 12% in 9M FY21 vs Industry degrowth of 8% (Privat
Slide 34: BALIC – Q3 FY21 highlights
BALIC – Q3 FY21 highlights All Figures in Rs. Million Performance Highlights of Q3 FY21 over Q3 FY20 CY 6,132 10,842 14,406 31,467 14% 27% 26% 23% PY 5,387 8,514 11,412 25,519 Individual Rated NB Group NB Renewal Premium Gross Written Premium CY 1,186 708% Solvency Ratio -17% as on 31 Dec 2020 PY 1,
Slide 35: BALIC: Ticket Size
BALIC : Ticket Size All Figures in Rs. Regular Premium Ticket Size Regular Premium Ticket Size (Agency) FY20 Q3 FY21 FY20 Increase of Q3 FY21 decrease of increase of 10% decrease of 7% 14% 5% 88,689 65,352 85,211 84,494 61,716 61,033 74,714 56,128 FY19 FY20 Q3 FY20 Q3 FY21 FY19 FY20 Q3 FY20 Q3 FY21
Slide 36: BALIC: Persistency
BALIC : Persistency Persistency 13th Month Persistency 25th Month 80% 71% 80% 71% 70% 79% 78% 68% Persistency - 13th Month Persistency - 25th Month FY19 FY20 9M FY20 9M FY21 FY19 FY20 9M FY20 9M FY21 Persistency 37th Month Persistency 49th Month Persistency 61st Month 61% 53% 41% 40% 40% 58% 51% 58%
Slide 37: BALIC: Individual Rated New Business
BALIC : Individual Rated New Business All Figures in Rs Million Individual Rated NB Individual Rated NB Agency FY20 Increase of 11% FY20 decrease of 10% 19,271 12,039 17,420 Q3 FY21 growth is 10,826 Q3 FY21 decrease 14% of 12% 5,387 6,132 3,253 2,848 FY19 FY20 Q3 FY20 Q3 FY21 FY19 FY20 Q3 FY20 Q3 FY
Slide 38: BALIC: Diversified Distribution Mix
BALIC : Diversified Distribution Mix Individual Rated New Business Mix BALIC embarked on diversifying its distribution mix, scaling up alternate channels and enabling wider 10% 11% 12% 11% presence by exploring alternate partnerships 20% 28% Reduced over reliance on Agency channel with 33% 43% a
Slide 39: BALIC: Balanced product mix
BALIC : Balanced product mix Individual Rated Mix Share of Non-ULIP business in individual business increasing 51% 51% 42% Individual - Unit Linked 60% Individual - Non Par Protection 1% 4% 0% 1% Individual - Non Par Savings 20% 17% 28% 9% Individual - Par 30% 28% 32% 26% FY19 FY20 Q3 FY20 Q3 FY21 G
Slide 40: BALIC: Assets Under Management
BALIC : Assets Under Management AUM (Mix) • AUM as on 31 Dec 2020 grew by 16%; Growth in UL AUM stands at 16%; Traditional AUM grew 566 561 608 703 by 15% 427 336 365 370 • Of the UL Funds of Rs.276 Bn., 276 65% is equity as on 31 Dec 230 238 196 2020 (59% as on 31 Dec 2019 out of the UL Funds of Rs
Slide 41: Digital Initiatives to offer next in class customer experience
Digital Initiatives to offer next in class customer experience Smart Assist WhatsApp Co-Browsing capabilities : First Real Time servicing Platform time in India • Face-2-Face meetings NOW Screen-2- • 6,50,000+ Transactions Done in 9M FY21 Screen (device agnostic platform for customers) • New Busines
Slide 42: Additional Information – Claims
Additional Information – Claims
Slide 43: BAGIC: LOB wise Net Claim ratio (Major LOBs)
BAGIC : LOB wise Net Claim ratio (Major LOBs) Net Claim Ratio Line of Business Q3 FY21 Q3 FY20 9M FY21 9M FY20 Fire 46.4% 13.4% 66.1% 74.5% Marine Cargo 34.5% 42.1% 69.3% 70.2% Motor OD 59.1% 72.9% 49.9% 68.2% Motor TP 74.0% 67.1% 77.7% 66.3% Motor Total 67.7% 69.5% 66.2% 67.1% Engineering 35.7% 7.9
Slide 44: Disclaimer
Disclaimer This presentation has been prepared by Bajaj Finserv Limited (the “Company”) solely for your information and for your use. This presentation is for information purposes only and should not be deemed to constitute or form part of any offer or invitation or inducement to sell or issue any s
Slide 45: Thank You
BAJAJ FINSERV Thank You