Bajaj Finserv Limited · NSE:BAJAJFINSV
Bajaj Finserv — Bajaj Finance — Q4 FY21 Earnings Presentation
54 slides from Bajaj Finserv's earnings presentation, Apr 27, 2021
Slide 1: Q4 FY21 Investor Presentation 27 April 2021
Q4 FY21 Investor Presentation 27 April 2021
Slide 2: Presentation Path
Presentation Path Section 01 Section 03 Section 05 Section 07 Executive summary Financial performance Customer franchise and Update on Q4 FY21 Q4 FY21 distribution reach credit quality 9 27 38 50 Section 02 Section 04 Section 06 Bajaj Finance Limited Asset liability Business segment wise overview ma
Slide 3: Section 01 Executive summary Q4 FY21
1.1 Quarter gone by 1.2 Lead financial indicators Section 01 Executive summary Q4 FY21 Preliminary assessment of 1.3 second wave 1.4 Executive summary - Q4 FY21 3
Slide 4: Quarter gone by
Quarter gone by A good quarter for the Company with most lead financial indicators normalizing to pre-COVID levels. Business transformation plan of the Company is on track. We expect to launch 3-in-1 financial services in a phased manner by August and September. AUM Opex to NII PAT ROE* Net NPA ₹ 1,
Slide 5: Lead financial indicators
Lead financial indicators 1. AUM as of 31 March 2021 was at ₹1,52,947 crore as against ₹1,47,153 crore as of 31 March 2020, YoY growth of 4%. Core AUM growth in Q4 FY21 was ₹ 9,397 crore as compared to ₹ 2,061 crore in Q4 FY20. Average AUM growth for 3 quarters of FY20 was ₹ 9,734 crore. Our diversi
Slide 6: Lead financial indicators
Lead financial indicators 8. Operating expenses in Q4 FY21 were higher by ₹ 153 crore vs Q4 FY20. Recovery commission was higher by ₹ 140 crore and employee related costs were higher by ₹ 151 crore. Opex increase was partly mitigated by prudent management of other expenses. 9. Opex to NIM came in at
Slide 7: Lead financial indicators
Lead financial indicators 14. The bounce rates of new origination across businesses are in line or better than pre-COVID origination. The current bucket bounce rates across portfolios is close to pre-COVID levels. The current bucket collection efficiencies across all portfolios are better than pre-C
Slide 8: Preliminary assessment of second wave
Preliminary assessment of second wave 1. Barring a national lockdown, 3-4 large GDP contributing states going into simultaneous lockdown for 3-5 weeks and another moratorium on loan repayment, the Company is confident of delivering its long term guidance metrics in FY22. 2. Having experienced the fi
Slide 9: Executive summary Q4 FY21
Executive summary Q4 FY21 Business update by segments: 1. Most businesses have started disbursing 90- 2. In Q4 FY21, urban consumption businesses (B2B) were at 105%, rural consumption business (B2B) at 119%, credit card origination at 95%, ecommerce at 84% and auto finance business was at 80% of Q4
Slide 10: Executive summary Q4 FY21
Executive summary Q4 FY21 Update on Business transformation: 9. The Company is on course to deliver its 3-in-1 financial services for its 48.57 MM customers in a seamless manner by creating an omnichannel framework. The omnichannel model will enable the customer to move between online to offline and
Slide 11: Executive summary Q4 FY21
Executive summary Q4 FY21 Customer Experience: 1 and it continues to add 1.8-2.5 MM new customers every quarter. It is imperative for the Company to design its product, processes, technology stack and practices that reduce friction for purchase and post purchase experience of customers. The updates
Slide 12: Executive summary Q4 FY21 - Subsidiaries
Executive summary Q4 FY21 Subsidiaries 23. Bajaj Housing Finance Ltd (BHFL) profit after tax increased by 97% to ₹ 179 crore in Q4 FY21 against ₹ 91 crore in Q4 FY20. 24. AUM increased by 19% to ₹ 38,871 crore as of 31 March 2021 from ₹ 32,705 crore as of 31 March 2020. 25. ₹ 369 crore from ₹ 283 cr
Slide 13: Section 02 Bajaj Finance Limited overview
2.1 Bajaj group structure 2.2 What do we stand for 2.3 Our general long-term guidance on Financial metrics shareholder profile Section 02 2.4 Key strategic differentiators Bajaj Finance Limited overview 2.5 Our shareholder profile 2.6 10-year financial snapshot 2.7 Product suite 2.8 Executive summar
Slide 14: Bajaj group structure
Bajaj group structure Bajaj Holdings & Investment Limited (BHIL) (Listed) 39.16% 1 33.43% 2 Bajaj Finserv Limited Bajaj Auto Limited (Listed) (Listed) Financial services arm Auto business arm 74% 74% 52.74% 3 Bajaj Finance Limited Bajaj Allianz Life Bajaj Allianz General (Listed) Insurance Company L
Slide 15: What do we stand for
What do we stand for - a sustainable ROA of 3.3-3.5% and ROE of 19-21% in the long term 15
Slide 16: Our general long-term guidance on financial metrics
Our general long-term guidance on financial metrics AUM growth Profit growth GNPA in corridor of in corridor of in corridor of 25%-27% 23%-24% 1.4%-1.7% NNPA Return on assets Return on equity in corridor of in corridor of in corridor of 0.4%-0.7% 3.3%-3.5% 19%-21% 16
Slide 17: Key strategic differentiators
Key strategic differentiators Part of the Bajaj group one of the oldest & most A trusted brand with strong brand equity respected business houses Focus on mass affluent and above clients Total customer franchise of 48.57 MM Strong focus on cross selling assets, payments, Centre of Excellence for eac
Slide 18: Our shareholder profile
Our shareholder profile Top 20 investors & their holdings As on 31 As on 31 As on 31 MF S.No Name of Shareholder March 21 Dec 20 March 20 6.39% 1 BAJAJ FINSERV LTD 52.74% 52.74% 52.82% 2 GOVERNMENT OF SINGAPORE 4.20% 4.28% 4.46% Others 3 MAHARASHTRA SCOOTERS LIMITED 3.15% 3.15% 3.15% AXIS MUTUAL FUN
Slide 19: 10-year financial snapshot
10-year financial snapshot ₹ in crore FY18@ FY19 @ FY20 @ FY21 @ YoY CAGR Financials snapshot @ FY12 FY13 FY14 FY15 FY16 FY17 (Consol.) (Consol.) (Consol.) (Consol.) (FY20 FY21) (10 yrs) Assets under management 13,107 17,517 24,061 32,410 44,229 60,196 82,422 1,15,888 1,47,153 152,947 4% 31% Income
Slide 20: Product suite
Product suite BAJAJ FINANCE LIMITED Consumer SME Commercial Rural Deposits Partnerships & Services 1. Consumer Durable Loans 1. Unsecured Working 1. Loan against securities 1. Consumer Durable 1. Retail Term 1. Life Insurance 2. Digital Product Loans (E) Capital Loans (E) 2. IPO financing Loans Depo
Slide 21: Executive summary Consolidated
Executive summary Consolidated Overview • 34-year-old non-bank with a demonstrated track record of profitable growth • Diversified financial services company focused on Consumer, Rural, SME, Commercial, Mortgages and Payments • Focused on mass affluent client with a strategy to cross sell • Strong f
Slide 22: Executive summary Bajaj Finance Limited
Executive summary Bajaj Finance Limited Overview • Focused on Consumer, Rural, SME, Commercial and Payments lines of businesses • Strategic business unit organization design supported by horizontal common utility functions to drive domain expertise, scalability and operating leverage • Focused on cr
Slide 23: Executive summary Bajaj Finance Limited
Executive summary Bajaj Finance Limited SME Business • Offers unsecured working capital loans to SME and self-employed professionals • Secured offerings include enterprise loans against property and financing against used car • Focused on affluent SMEs (average sales of ₹ 15 to 17 crore) with establ
Slide 24: Executive summary Bajaj Housing Finance Limited
Executive summary Bajaj Housing Finance Limited Bajaj Housing • A 100% subsidiary of Bajaj Finance Limited, registered with National Housing Bank as a Housing Finance Company Finance Limited • Strategic business unit organization design supported by horizontal common utility functions to drive domai
Slide 25: Executive summary Bajaj Housing Finance Limited
Executive summary Bajaj Housing Finance Limited Lease Rental • Offers loan against lease rentals to high-net-worth individuals and developers on commercial property leased mainly to Discounting corporate tenants • All lease rental discounting transactions are backed by rentals through escrow mechani
Slide 26: Executive summary Bajaj Financial Securities Limited
Executive summary Bajaj Financial Securities Limited • A 100% subsidiary of Bajaj Finance Limited, registered with Securities and Exchange Board of India (SEBI) • Having membership of Stock Exchanges (NSE and BSE), Depositaries (NSDL & CDSL) and AMFI for distribution of Mutual Funds • Offers Capital
Slide 27: Section 03 Financial performance Q4 FY21
Financial statement summary 3.1 Consolidated Section 03 Financial statement summary Financial performance 3.2 Bajaj Finance Limited 3.3 Financial statement summary Bajaj Housing Finance Limited 27
Slide 28: Financial statement summary Consolidated
Financial statement summary Consolidated ₹ in Crore Financials snapshot Q4 FY21 Q4 FY20 Q-o-Q FY21 FY20 Y-o-Y Assets under management 1,52,947 1,47,153 4% 1,52,947 1,47,153 4% Assets under finance 1,46,687 1,41,376 4% 1,46,687 1,41,376 4% Interest income 6,034 6,302 (4%) 23,304 22,970 1% Fee and oth
Slide 29: Financial statement summary Bajaj Finance Ltd.
Financial statement summary Bajaj Finance Ltd. ₹ in Crore Financials snapshot Q4 FY21 Q4 FY20 QoQ FY21 FY20 YoY Assets under management 115,418 116,102 (1%) 115,418 116,102 (1%) Assets under finance 113,090 113,417 0% 113,090 113,417 0% Interest income 5,288 5,616 (6%) 20,419 20,668 (1%) Fee and oth
Slide 30: Financial statement summary Bajaj Housing Finance Ltd.
Financial statement summary Bajaj Housing Finance Ltd. ₹ in Crore Financials snapshot Q4 FY21 Q4 FY20 YoY FY21 FY20 YoY Assets under management 38,871 32,705 19% 38,871 32,705 19% Assets under finance 33,419 27,975 19% 33,419 27,975 19% Interest income 743 687 8% 2,877 2,303 25% Fee and other income
Slide 31: Section 04 Asset liability management
4.1 Conservative leverage standards Bajaj Finance Limited 4.2 Resilient business model Consolidated Section 04 4.3 Behaviouralized ALM as of 31 March Bajaj Finance Limited Asset liability management 4.4 Behaviouralized ALM as of 31 March Bajaj Housing Finance Limited 4.5 Disciplined ALM Management B
Slide 32: Conservative leverage standards
Conservative leverage standards 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 7.0 28.2% 28.34% 26.4% 26.6% 6.8 25.0% 6.6 24.7% 6.4 6.3 6.3 6.2 22.0% 24.7% 25.10% 5.3 20.3% 5.4 22.6% 23.0% 19.1% 19.5% 5.1 4.7* 18.0% 20.7% 17.5% 4.7 4.7 4.6 19.7% 21.3% 18.7% 16.2% 16.1% 16.3% 15.0% 14.6% 14.2% 5.7% 5.0%
Slide 33: Resilient business model Consolidated
Resilient business model Consolidated 47.0% 46.0% 44.6% 45.0% 43.69% 44.00% 43.80% 43.1% 42.24% 41.4% 41.8% 38.4% 36.0% 35.3% 35.39% 34.45% 32.9% 33.3% 32.30% 29.9% 33.50% 28.4% 27.2% 27.90% 27.80% 26.4% 9.16% 9.74% 9.85% 9.87% 9.47% 9.00% 8.24% 8.27% 8.39% 8.17% 8.02% 7.78% 7.39% 4.2% 4.1% 3.6% 3.5
Slide 34: Behaviouralized ALM as of 31 March 2021 BFL
Behaviouralized ALM as of 31 March 2021 BFL ₹ in Crore Particulars 1-7D 8 - 14 D 15 - 30 D >1-2M >2-3M > 3 - 6 M > 6M - 1Y > 1 - 3Y >3- 5Y >5Y Total Cash & Investments 11,658 197 0 509 0 978 103 2,439 0 5,668 21,553 Advances 3,552 1,147 2,849 5,213 5,426 13,464 19,654 38,941 17,280 5,928 1,13,455 Ot
Slide 35: Behaviouralized ALM as of 31 March 2021 BHFL
Behaviouralized ALM as of 31 March 2021 BHFL ₹ in Crore Particulars 1D - 7D 7D - 14D 15D - 30D >1 - 2M >2 - 3M >3 - 6M >6M - 1Y >1Y - 3Y >3Y - 5Y >5Y - 7Y >7Y - 10Y >10 Y Total Cash & Investments 2,969 255 - 759 - - - 0 - - - - 3,983 Advances 397 173 404 763 738 2,092 3,717 10,466 6,082 3,688 2,925
Slide 36: Disciplined ALM Management
Disciplined ALM Management Cumulative gap upto 1 month Cumulative gap upto 12 month Permissible limit 300% 220% 216% 182% 141% 119% 120% 75% 61% 96% 80% 51% 88% 48% 73% 36% 36% 71% 70% 50% 57% 54% 38% 44% 16% 4% -15% -15% -15% -15% -15% -15% -15% -15% -20% -20% -20% -20% -20% -15% ALM mismatch for u
Slide 37: Liability mix over the last 9 years
Liability mix over the last 9 years 5% 5% 4% 5% 5% 6% 5% 8% 10% 8% 8% 3% 13% 4% 3% 4% 6% 6% 4% 4% 5% 6% 5% 4% 3% 7% 4% 4% 4% 33% 38% 35% 25% 38% 38% 35% 35% 35% 37% 40% 43% 30% 31% 28% 26% 22% 54% 34% 58% 48% 53% 31% 35% 24% 26% 21% 21% 22% 12% 15% 0% 1% 6% 8% 4% Mar'13 Mar'14 Mar'15 Mar'16 Mar'17 M
Slide 38: Section 05 Customer franchise and distribution reach
5.1 Customer franchise Section 05 Customer franchise and 5.2 Geographic presence distribution reach 5.3 Strong distribution reach 38
Slide 39: Customer franchise
Customer franchise Q4 FY20 Q4 FY21 Q3 FY21 42.60 MM Total Franchise 48.57 MM 46.31 MM 33.47 MM Credit segment filter 38.50 MM 36.60 MM 32.32 MM Overall Cross sell franchise 37.10 MM 35.32 MM Non delinquent 28.48 MM customers 32.63 MM 30.80 MM Cross sell franchise 24.13 MM 26.89 MM 25.25 MM (56.6%) *
Slide 40: Geographic presence
Geographic presence 31 Mar 31 Mar 31 Mar 31 Mar 31 Dec 31 Mar Geographic Presence 2017 2018 2019 2020 2020 2021 Urban 377 730 927 1,035 1,210 1,298 Of which urban lending branches 377 730 927 1,035 1,137 1,148 Of which urban lending franchisee 73 150 Rural 538 602 903 1,357 1,604 1,690 Of which rura
Slide 41: Strong distribution reach
Strong distribution reach Active distribution 31 Mar 2018 31 Mar 2019 31 Mar 2020 30 Sept 2020 31 Dec 2020 31 Mar 2021 Consumer durable stores Urban 15,500+ 20,400+ 24,200+ 24,200+ 24,700+ 26,400+ Consumer durable stores Rural 8,200+ 14,500+ 19,600+ 19,600+ 22,500+ 24,000+ Digital product stores 15,
Slide 42: Section 06 Business segment wise AUM
Section 06 6.1 Business segment wise AUM as of 31 March - Consolidated Business segment wise AUM 6.2 Business segment wise AUM as of 31 March Mortgages 42
Slide 43: Business segment wise AUM - Consolidated
Business segment wise AUM - Consolidated BFL as of BHFL as of Consolidated as Consolidated as Composition as of Assets Under Management Growth 31 March 2021 31 March 2021 of 31 March 2021 of 31 March 2020 31 March 2021 Auto Finance Business 12,112 - 12,112 13,085 (7%) 8% Sales Finance Business 11,52
Slide 44: Break-up of AUM as of 31 March 2021 - Mortgages
Break-up of AUM as of 31 March 2021 - Mortgages ₹ in crore Bajaj Housing Finance Limited Mortgage All Composition as of Assets Under Management 31 March 2021 31 March 2020 Growth 31 March 2021 31 March 2020 Growth 31 March 2021 Home Loans 23,943 21,435 12% 27,525 26,724 3% 56% Loan against property
Slide 45: Section 07 Update on credit quality
7.1 Provisioning Coverage - Consolidated 7.2 ECL summary Consolidated Section 07 ECL summary Bajaj Housing Finance Limited Update on credit quality 7.3 7.4 Portfolio stagewise provisioning 7.5 Portfolio credit quality - Consolidated 45
Slide 46: Provisioning Coverage - Consolidated
Provisioning Coverage - Consolidated ₹ in Crore Consol AUM PCR GNPA % NNPA % Assets Under Management GNPA NNPA 31 Mar 2021 (%) 31 Mar 20 31 Dec 20* 31 Mar 21 31 Mar 20 31 Dec 20* 31 Mar 21 Auto Finance Business 12,112 1,227 609 50% 6.47% 11.54% 9.31% 3.08% 6.09% 4.84% Sales Finance Business 11,526 1
Slide 47: ECL summary Consolidated
ECL summary Consolidated Assets categorization Stage 1 & 2 (represents standard assets) 98.39% 98.60% 98.66% 97.14% 98.21% Stage 3 (classified as NPA) 1.61% 1.40% 1.03% 0.55% 1.79% Stage 3 (not classified as NPA) - - 0.31% 2.32% - Summary of stage wise assets and provision for impairment allowance A
Slide 48: ECL summary Bajaj Housing Finance Limited
ECL summary Bajaj Housing Finance Limited ECL categorization Stage 1 & 2 (represents standard assets) 99.92% 99.92% 99.91% 99.65% 99.65% Stage 3 (represents GNPA) 0.08% 0.08% 0.08% 0.06% 0.35% Stage 3 (not classified as NPA) 0.01% 0.29% Summary of stage wise assets and ECL provisioning Financial Ass
Slide 49: Portfolio stagewise provisioning as of 31 March 2021
Portfolio stagewise provisioning as of 31 March 2021 ₹ in crore Gross Assets Receivable Stagewise Provision PCR % Stage 2 Stage 2 Stage 2 Stage 1 Stage 3 Stage 1 Stage 3 Stage 1 Stage 3 OTR* Normal OTR* Normal OTR* Normal Auto Finance Business 9,557 145 2,254 1,227 103 10 340 619 1.1% 6.8% 15.1% 50.
Slide 50: Portfolio credit quality Consolidated
Portfolio credit quality Consolidated Consumer Durable & Lifestyle Two & three-wheeler Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 5+ Bucket 1 98.96% 98.73% 98.60% 98.47% 98.55% 98.65% 92.10% 98.92% 99.52% 1 89.68% 90.15%
Slide 51: Portfolio credit quality Consolidated
Portfolio credit quality Consolidated Business & professional loans Rural Lending B2B Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 1 98.82% 98.75% 98.59% 98.42% 98.35% 98.27% 93.43% 97.19% 98.50% 1 99.54% 99.26% 98.93% 98.8
Slide 52: Portfolio credit quality Consolidated
Portfolio credit quality Consolidated Home loans Stage 1st Bucket 2nd Bucket 3rd Bucket 4th Bucket 5th Bucket 5+ Bucket 1 99.54% 99.52% 99.42% 99.61% 99.63% 99.60% 98.31% 98.67% 99.56% 2 0.20% 0.22% 0.27% 0.13% 0.15% 0.11% 1.40% 1.03% 0.24% 1.8% 1.6% 1.4% 1.2% 1.0% 0.8% 0.6% 0.4% 0.2% 0.0% -0.2% Dec
Slide 53: Thank You
BAJAJ FINANCE LIMITED Q4 FY21 Investor Presentation Thank You
Slide 54: Disclaimer
Disclaimer This presentation has been prepared by and is the sole responsibility of Bajaj Finance Limited (together with its subsidiaries, referred to as the Company or . By accessing this presentation, you are agreeing to be bound by the trailing restrictions. This presentation does not constitute