Home First Finance Company India Ltd. · NSE:HOMEFIRST
Home First Finance Company India — Q3 FY2021 Earnings Presentation
34 slides from Home First Finance Company India's earnings presentation, Feb 12, 2021
Slide 1: Stock exchange filing cover letter
HFFCIL/BSE/NSE/EQ/07/2020-21 Date: 12-02-2021 To, To, BSE Limited, The National Stock Exchange of India Limited, Department of Corporate Services, The Listing Department, Phiroze Jeejeebhoy Towers, Bandra Kurla Complex, Dalal Street, Mumbai- 400 051. Mumbai- 400001. Scrip Code- 543259 Scrip Symbol-
Slide 2: Investor Presentation - Q3FY21
homeftirst We'll take you home Investor Presentation - Q3FY21
Slide 3: Disclaimer
This presentation and the accompanying slides (the "Presentation"), which have been prepared by Home First Finance Company India 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 sec
Slide 4: Homefirst listed on NSE and BSE on February 3rd, 2021
• Homefirst listed on NSE and BSE on February 3rd, 2021 – which coincides with the company’s date of Incorporation • Total Issue Size: Rs 11,537.19 million • Primary issue of Rs 2,650.00 million • Offer price: Rs 518 per share • 26.21 times subscription No of times of Sr No. Category Shares Offered
Slide 5: Q3FY21 key metrics
AUM Disbursement PAT Spread* Rs 39,406 Mn Rs 6,448 Mn Rs 689 Mn 4.7% +16.1% y-o-y -49.3% y-o-y +2.7% y-o-y +60 bps y-o-y Gross Stage3/POS ROA Opex to Assets Cost to Income 1.6% 2.5% 2.7% 39.5% +60 bps y-o-y -60 bps y-o-y -100 bps y-o-y -540 bps y-o-y Collection Efficiency strong at 97.6% for the mon
Slide 6: Technology driven Affordable Housing Finance Company with pan India presence
Branches / States / Districts Technology driven Affordable Housing Finance Company with pan India presence 72/11/60 Active customer accounts Home Loans to first time home buyers with predominant focus on salaried 47,115 individuals having income <Rs. 50k p.m Occupation Mix of AUM (9MFY21) 92% of boo
Slide 7: Scalable operating model and journey since 2010
invested in the Scalable operating CARE Rating CARE/ICRA Rating company (2) model AuM crosses 60,000+ BBB- BBB+ A- A+ Rs. 35bn. sanctions Rs 39,406 Mn AuM AuM 30,000+ customers 36,183 39,406 Series C Net Worth Series B crosses Rs. 5,000 True North acquires Mn. Alpha TC 24,436 10,000 majority stake H
Slide 8: Shareholding pattern
PROMOTER & PROMOTER GROUP % Holding TRUE NORTH FUND V LLP 20.3 AETHER (MAURITIUS) LIMITED 13.4 TRUE NORTH FUND V LLP KEY INVESTORS % Holding AETHER (MAURITIUS) LIMITED ORANGE CLOVE INVESTMENTS B.V (WARBURG PINCUS) 28.8 16.7% 20.3% BESSEMER INDIA CAPITAL HOLDINGS II LTD 7.8 ORANGE CLOVE INVESTMENTS B
Slide 9: Experienced Management team and Distinguished Board
Experienced Management team Distinguished Board Deepak Satwalekar Independent Manoj Viswanathan Ajay Khetan 24+ 19+ Ex MD, CEO of HDFC Life Director Managing Director & CEO Chief Business Officer 23+ years in Consumer Lending. 11 years with CITI. 18+years in Consumer Lending & Technology at Macq
Slide 10: Customer profiles and experience
Formal Salaried Informal Salaried Self employed Salaried Customer 1 Customer 2 Customer 3 Self-Emp Age:44 / Location: KR Puram (suburbs of Bangalore) 75% Age: 32 / Location: Sayan (suburbs of Surat) Age: 36 / Location: Avadi (suburbs of Chennai) 25% Who are they? Photo Photo Photo Teacher with sever
Slide 11: Our customers and value proposition
Who are our customers… What do our customers need What challenges do they face Salaried and self-employed individuals Home loan requirement Inability to meet NPS primarily in the Rs 0.5 -1.5 mn documentation requirements 75%+ Customers with annual range (1) of traditional lenders household i
Slide 12: Pan India Distribution driven by strategic market selection
Pan India Distribution driven by strategic market selection & contiguous expansion 72 60 11 Geographic Expansion Branches Districts States & 1 UT Percentage of Gross Loan Number of Number of States / Territories Assets as on Industry disbursement in FY19 (Rs. Branches Districts million.)(1) December
Slide 13: Risk Management Design and Tech-Led Centralised underwriting
Risk Management Design Tech-Led Centralised Salaried customers 100+ data points & digitally Consistency in underwriting captured data for all customers Loans approved Build detailed understanding of Integrated CRM and Loan within 48 hrs customer via field visits by RM API integration with third
Slide 14: End-to-end digital process for housing loans
Home First App for all API Integration with third stakeholders party databases Customers Customers registered on App App Proprietary property price 360o view of customer for predictor employees Machine learning 64% models to assist Electronic payments End-to-end underwriting As of 31 Dec‘20 digital
Slide 15: Business Updates
Business Updates 14
Slide 16: Disbursement and AUM
Dec’20 disbursals surpasses Dec’19 Rs Mn Disbursement YoY: - 9.6% YoY: -49.3% 15,728 16,183 12,717 7,455 6,448 2,432 3,488 528 FY18 FY19 FY20 Q1FY21 Q2FY21 Q3FY21 9MFY20 9MFY21 AUM YoY: +16.1% 37,300 39,406 39,406 36,184 36,225 33,939 24,436 13,559 FY18 FY19 FY20 Q1FY21 Q2FY21 Q3FY21 9MFY20 9MFY21 1
Slide 17: Sharp focus on Housing Loans, salaried customers
Sharp focus on Housing Loans Higher proportion of salaried customers AUM by Product Category AUM by Occupation 5% 2% Housing Loan 1% 1% Salaried 25% Loans for purchase of 9MFY21 commercial property 9MFY21 Self employed Loans against property 74% 92% Corporate Developer Finance Optimal balance of cre
Slide 18: Reduction in cost of borrowing in Q3FY21
12.9% 13.1% 13.1% 13.0% 12.6% 12.3% 8.8% 8.8% 8.5% 8.4% 8.3% 8.0% FY18 FY19 FY20 Q1FY21 Q2FY21 Q3FY21 Portfolio Yield COB Spread 4.6% 4.8% 5.0% 3.8% 3.9% 4.1% Reduction in cost of borrowing in Q3FY21 on account of rate reset in existing term loans and competitive marginal cost of fresh borrowing 17
Slide 19: Bounce rate
Bounce rate Bounce rate on the day of EMI presentation 36.4% Bounce rate 28.3% Bounce rate impacted due to Covid-19 20.1% 11.7% 10.8% 10.2% 10.9% 10.5% 9.5% 10.0% 9.2% Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 18
Slide 20: Collection Efficiency
Collection Efficiency 99.8% 97.6% 94.3% 96.3% 96.6% 95.5% 96.1% 93.8% 95.3% 84.6% 83.5% 78.4% 79.8% 72.9% 72.5% 74.7% 64.4% 63.7% Apr-20 May-20 Jun-20 Jul-20 Aug-20 Sep-20 Oct-20 Nov-20 Dec-20 (1) (2) Collection efficiency Unique customers Note: 19 (1) Collection Efficiency = Total # of EMIs receive
Slide 21: Gross Stage 3/POS of 1.6% with Zero restructuring
Gross Stage3/POS of 1.6% with Zero restructuring Gross Stage 3/POS % Net Stage 3/Net POS % 1.6% 1.1% 1.0% 1.0% 0.9% 0.8% 0.8% 0.7% 0.6% 0.6% 0.6% 0.5% FY18 FY19 FY20 Q1FY21 Q2FY21 Q3FY21 FY18 FY19 FY20 Q1FY21 Q2FY21 Q3FY21 DPD 1+/POS DPD 30+/POS 4.1% 7.5% 6.7% 4.4% 2.0% 3.1% 3.2% 1.7% 1.4% 1.5% 1.3%
Slide 22: Borrowings Mix and Cost of Borrowing trend
Long Term Rating: A+ Stable Short Term Rating: A1+ Borrowings Mix and Cost of Borrowing trend 100% 9.00% 15% 17% 21% 19% 21% 19% 90% 22% 8.80% 80% 8.9% 8.9% 8.8% 5% 7% 7% 70% 20% 21% 8.60% 23% 18% 21% 60% 2% 1% 1% 8.6% 2% 21% 26% 8.40% 8.5% 50% 2% 2%8.3% 1% 32% 32% 40% 39% 33% 28% 8.20% 29% 27% 30%
Slide 23: Robust ALM profile ensuring sufficient liquidity buffers
Rs Mn 7,509 8,569 8,990 7,527 13,520 10,470 Surplus 69,423 56,292 58,953 40,864 42,772 33,338 22,638 16,025 13,648 11,895 4,386 7,456 0-3months 3-6 months 6-12 months 1-3 years 3-5 years 5+ years Inflows (Rs Mn) Outflows (Rs Mn) Robust ALM profile ensuring Cumulative Positive flows sufficient liquid
Slide 24: Liquidity Buffer as on Dec'20
Liquidity Buffer as on Dec’20 (in Rs mn) Particulars (in Rs mn) Q4FY21 Q1FY22 Q2FY22 Q3FY22 Unencumbered Cash and Cash equivalent 6,632 Opening Liquidity 15,427 15,634 15,550 15,386 Un-availed Sanction from NHB 2,500 Add: Principal Collections & 2,390 2,398 2,311 2,267 Surplus from Operations Un-ava
Slide 25: Financial Updates
Financial Updates 24
Slide 26: PAT, Networth, Return on Average Assets and Equity
PAT (Rs Mn) Networth (Rs Mn) Equity raised YoY: +2.7% (INR Mn.) - 1508 3281 3281 881 10,921 796 9,334 9,200 671 689 457 5,227 160 3,242 FY18 FY19 FY20 9MFY20 9MFY21 FY18 FY19 FY20 9MFY20 9MFY21 Return on Average Assets (1) Return on Average Equity (1) A/E 3.7x 4.5x 4.1x 3.9x 3.7x 12.4% 10.8% 10.9% 9
Slide 27: Loan principal and ECL provisions by stage
Loan Particulars (in Rs million) Stage 1 Stage 2 Stage 3 Total Provision Coverage Ratio Commitment For period ended 31st December 2020 31st December 2020 Loans – Principal Outstanding 31,187.6 821.3 510.7 32,519.6 ECL Provision 194.3 111.9 146.0 9.6 461.8 Net Loans – Principal Outstanding 30,993.3 7
Slide 28: Annexures
Annexures 27
Slide 29: Profit and loss statement
Particulars Q3FY21 Q2FY21 Q3FY20 QoQ YoY 9MFY21 9MFY20 YoY (in Rs million) Interest Income on 1,013.7 969.4 927.7 4.6% 9.3% 2,995.5 2,476.1 21.0% term loans Interest expense 531.5 561.8 505.2 -5.4% 5.2% 1,631.3 1,409.3 15.8% Net Interest Income 482.2 407.6 422.5 18.3% 14.1% 1,364.2 1,066.8 27.9% Net
Slide 30: Key ratios as percentage of average total assets
Particulars Q3FY21 Q2FY21 Q3FY20 9MFY21 9MFY20 Interest Income on term loans/ Average total assets 10.5% 10.4% 11.5% 10.7% 11.6% Interest on borrowings and debt securities / Average total assets 5.5% 6.1% 6.3% 5.8% 6.6% Net Interest Margin 5.0% 4.4% 5.2% 4.9% 5.0% Net Gain on DA/ Average total Asset
Slide 31: Return and capital adequacy ratios
Particulars 9MFY21 9MFY20 Profit after tax on average total assets (ROA) 2.5% 3.1% Leverage (Average total assets/average Equity or average Net-worth) 3.7 3.9 Profit after tax on average equity or average Net-worth (ROE) 9.1% 12.4% Cost to Income Ratio (Operating Expenses / Net Total Income) 39.5% 4
Slide 32: Balance sheet
Particulars (in Rs million) 9MFY21 FY20 9MFY20 ASSETS Cash & cash equivalents and Other bank balance 4,635.4 2220.6 2,385.3 Loans 32,067.3 30,139.1 27,758.7 Investments 2,439.3 1,455.6 950.4 Other financial assets 711.8 663.3 701.8 Property, plant and Equipment 160.2 204.8 211.1 Non-financial assets
Slide 33: Quarterly trend chart
Rs Mn Rs 2,756 Mn Rs 3,574 Mn Rs 1,844 Mn 2383 1,844 1,491 1,472 611 373 - - - - - Q1FY19 Q2FY19 Q3FY19 Q4FY19 Q1FY20 Q2FY20 Q3FY20 Q4FY20 Q1FY21 Q2FY21 Q3FY21 32
Slide 34: Thank You
Thank You For further information, please contact Company : Investor Relations Advisors : CIN: U65990MH2010PLC240703 Ms. Neha Shroff - +91 7738073466 neha.shroff@linkintime.co.in Investor Relations - HomeFirst investor.relations@homefirstindia.com 33
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