Hinduja Global Solutions Limited · NSE:HGS
Hinduja Global Solutions — Investor Presentation (September 2019)
40 slides from Hinduja Global Solutions's investor presentation, Sep 20, 2019
Slide 1: Regulation 30 intimation of investor meeting
OHGS HINDUIAOLOIAI. $0LUTIONS September 20, 2019 BSE Limited National Stock Exchange of India Ltd. Corporate Relation Dept. "Exchange Plaza", P. J. Towers, Dalal Street Bandra Kurla Complex, Sandra (East) Mumbai 400 001. Mumbai - 400 051. Scrip Code : 532859 Symbol: HGS Dear Sirs, Sub : Intimation u
Slide 2: Investor Presentation Sept, 2019
Investor Presentation Sept, 2019
Slide 3: Disclaimer
Disclaimer Certain statements in this presentation concerning our future growth prospects are forward-looking statements, which involve a number of risks, and uncertainties that could cause actual results to differ materially from those in such forward-looking statements. The risks and uncertainties
Slide 4: Quick Overview
CHGS Quick Overview
Slide 5: About the Company
About the Company HISTORY ▪ Part of the Hinduja Group, in the BPM business since 2000 ▪ Erstwhile HTMT, IT & BPM business demerged October 1, 2006 ▪ Rebranded as HGS in 2008 FINANCIAL DETAILS (FY’19 & Q1 FY’20) SNAPSHOTS FY’19 Q1 FY’20 (Post IndAS 116) ▪ CAGR of 14.0 % in Revenue (In INR) over FY 14
Slide 6: HGS Overview
CHGS HGS Overview
Slide 7: HGS Core Capabilities to Enable the Unified Customer Experience
HGS Core Capabilities to Enable the Unified Customer Experience Analytics Customer Experience Customer Marketing Digital Enablement Assessment Experience and Digital Customer Experience Strategy Enablement Social Media Strategy Services Services Engagement Digital Experience Digital Marketing Strate
Slide 8: Offerings
Offerings Largest investment in E-Care Digi, Social, RPA, innovation, largest CAGR Bots, machine M learning a r Target existing users in Classic Care g champion-challenger sales Traditional voice, chat, email i n s Shortest sales cycle (retain or more of Brilliant at Basics NPS, KPIs, guarantees, wo
Slide 9: Solutions and Industry Focus
Solutions and Industry Focus Engage Buy Care Bill Warrant Retain E-Care ▪ Emerging digital buyer ▪ B-C, B-B-C Classic Care ▪ Select deals based on “land & expand” ▪ Travel, hospitality, logistics, ▪ Late adopters, Smaller enterprises retail, selective tech prospects, insurance & large ▪ Traditional
Slide 10: Building Capability CoEs
Building Capability CoEs ANALYTICS DIGITAL AUTOMATION CoE CoE CoE ▪ Interaction Analytics services ▪ Launch of DigiCX services suite ▪ BOTs deployed across clients institutionalized ▪ Partnerships with platforms such ▪ Capability built on multiple ▪ Bringing Right Skill-set for as Liveperson, Sprink
Slide 11: Realigning Organization to Partner through Innovation to impact Outcomes
Realigning Organization to Partner through Innovation to impact Outcomes Verticalized business Global Innovation Hub Acquire/Partner for Capabilities Global Operations Digital Innovation Population Health Management Social Media Marketing One HGS- seamless delivery RPA Customer Journey Analytics Hea
Slide 12: Healthcare Practice Overview
Healthcare Practice Overview | 11
Slide 13: HGS Healthcare Journey
HGS Healthcare Journey 2016-2018 Acquisition of Colibrium – Sales and Enrollment Platform 2008-2011 2003 Acquisition of APH - Population Health Solutions Product Build Workers Comp Acquisition of Element - Customer Experience Enrolment Payment Integrity Management Solutions Geo expansion (Philippine
Slide 14: How HGS Healthcare business has grown
How HGS Healthcare business has grown HGS Healthcare Vertical Trend Total Healthcare Revenue (USD Mn) % of total Revenue 52.2% 49.2% 45.8% 41.7% 360 34.9% 26.2% 25.9% 27.8% 23.8% 22.4% 24.7% 21.3% 294 254 211 160 115 90 Acquired 73 61 41 49 Acquired 34 Colibrium Acquired EBOS FY 08 FY 09 FY 10 FY 11
Slide 15: Healthcare Revenue by Segment
Healthcare Revenue by Segment Healthcare Segmentations 4.0 46.4 5.2 48.4 32.6 12.6 14.7 25.8 17.1 9.5 10.6 255.8 261.0 5.8 215.8 179.7 150.2 103.9 84.0 FY 13 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19 Healthcare Payer Healthcare Provider Healthcare Clinical Services Healthcare Platform
Slide 16: Healthcare Practice reorganized to focus on solutions that matter to our clients
Healthcare Practice reorganized to focus on solutions that matter to our clients Payer Provider Services Services Provider Data Claim Management Payment Integrity Quality, Risk A/R Services Clinical Coding Healthcare Engagement Solutions
Slide 17: Payer Practices
Payer Practices Payer Services ▪ Expertise in both US and international claims handling Claims ▪ Point solutions for inventory control, quality and rework reduction ▪ Industry benchmarks established ▪ Proprietary technology led solutions for keeping provider data accurate and current Provider Data ▪
Slide 18: Practices Across Payer and Provider
Practices Across Payer and Provider Payer ▪ Offshore and nearshore locations, meet and exceed client onshore NPS Services Healthcare ▪ Digital channel engagement mix increased by 10-15% (chat, automated Engagement Solution messaging) ▪ Interaction analytics capability ▪ Deliver 2x ROI through case,
Slide 19: Digital and Automation/RPA
Digital and Automation/RPA | 18
Slide 20: HGS is developing industry leading Digital Customer Experience solutions
HGS is developing industry leading Digital Customer Experience solutions, creating value for our clients, and their customers ▪ Enabling the Optimized Consumer Journey… with clear objectives in mind Revenue generation and Kiosk Voice optimization Customer Experience – with In-person IVR NPS/RTF meas
Slide 21: The Automated Enterprise
The Automated Enterprise ▪ Automation everywhere enables each touchpoint through the digital end-to-end journey Virtual Agent Insights (chat, text, social) (Reporting, dashboards, analytics) Live Agent (Navigation, Customer ID, Policy Accurate IntelliFORM Compliance) Record (email) Updating (Real-ti
Slide 22: What does it mean for our Business - Opportunities
What does it mean for our Business - Opportunities AI will help BPaaS penetrate into the core, “heart of the business” processes Current scope of BPM/ AI to expand the scope of BPaaS BPM/ BPaaS 2-3x Core Back Core Back Mid-Office Mid-Office Processes Office Processes Office 1 As a multiple of curren
Slide 23: Key Highlights of HGS Process Automation Solution
Key Highlights of HGS Process Automation Solution Easy to set-up + Easy to use & change = High returns No need to Replace - uses Easy to Train - can work 24/7 15-50% Cost reduction existing enterprise applications and does not quit 50-75% TAT reduction No need to Integrate - Non- Easy to Run - keeps
Slide 24: Financial Overview
CHGS Financial Overview
Slide 25: Q1 FY20: Revenue Growth of 17.2%
Q1 FY 20 : Revenue Growth of 17.2% : • Constant currency growth of 18.6% over Q1 FY 19 (Excluding India Domestic) • Overall Revenue growth of 17.2% Revenue Bridge between QE June 18 and QE June 19 (in Rs Mn) 12,905 17.2% • Organic growth 17.2% , • Forex impact of 1.9% • Offset by drop 2,046 of 1.8%
Slide 26: Q1 FY20: EBITDA growth
Q1 FY 20: EBITDA growth • 52.5% improvement in EBITDA over Q1 FY 19 • 104.6% improvement in EBITDA over Q1 FY 19 with impact of IndAS 116 EBITDA Bridge between QE June 18 and QE June 19 (in Rs Mn) 1,496 104.6% 381 52.1% 384 1,496 52.5% 1,115 731 QE June 18 Improvement QE June 19 IndAS Impact QE June
Slide 27: Q1 FY20 Actuals vs Q4 FY19 vs Q1 FY19
Q1 FY 20 Actuals vs Q4 FY 19 vs Q1 FY 19 Quarterly Performance - Consolidated Figures in Rs Mn unless otherwise indicated Actual Actual QoQ Actual YoY QE June'19 QE Mar'19 Growth % QE June'18 Growth % Revenue 12,905 12,846 0.5% 11,008 17.2% Operating Costs (excl Dep) 11,408 11,358 10,277 EBITDA 1,49
Slide 28: FY19 Revenue Growth of 25.1%
FY 19 Revenue Growth of 25.1% • 13.5% constant current growth over FY 18 • Overall growth of 25.1% for FY 19 over FY 18 Revenue Bridge between FY 18 and FY 19 (in Rs Mn) 48,167 25.1% • Organic growth 3,242 11.3%, 8.4% • Forex growth 5.4%, 5,204 • Inorganic 13.5% 48,167 growth 8.4% 44,925 ( 860 ) 2,0
Slide 29: FY19: EBITDA Improvement
FY 19 : EBITDA Improvement • Organic growth in EBITDA of 22.7% • Overall EBITDA growth of 8.6% EBITDA Bridge between FY 18 and FY 19 (in Rs Mn) 4,411 8.6% 923 ( 573 ) 22.7% (14.1%) 4,411 4,061 3,488 3,488 FY 18 Acquisitions Improvement FY 19 (with Acquisitions)
Slide 30: Free Cash Flow to EBITDA Conversion
Free Cash Flow to EBITDA Conversion FREE CASH FLOW to EBITDA Ratio EBITDA FCF/EBITDA (%) 111% Figures in (INR Mn) 28% 19% 13% 1,386 1,488 1,115 744 792 -37% Q1 FY 19 Q2 FY 19 Q3 FY 19 Q4 FY 19 Q1 FY 20 Due to payment delays from few of the clients, the FCF EBITDA for Q4 FY 19 and Q1 FY 20 are distor
Slide 31: 6 Year Summary Cash Flow Statement
6 Year Summary Cash Flow Statement (Rs. Million) FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 Cash flow from Operations and after working capital 2,352 1,924 1,589 4,031 3,517 2,047 changes Cash Flow due to Capex (net) (1,137) (1,621) (2,472) (1,779) (1,261) (1,894) Total Cash Flow from Operation
Slide 32: Summary Financial Profile – As at 30th June 2019
Summary Financial Profile – As at 30th June 2019 HGSL Particulars Rs. USD Net Worth (in millions) 16,224 235.3 ➢ Book Value taken is as reported on QE June 2019 Book value per share 778 11.3 ➢ Stock prices and USD/INR exchange rate latest available Price per share 608.0 8.5 prices Dividend per share
Slide 33: HGS Revenue Profile: FY14 to YTD June 19
HGS Revenue Profile: FY 14 to YTD June 19 | 32
Slide 34: How have we grown
How have we grown Acquired Business Revenue Revenue Trend (In INR Mn.) Core Business Revenue 48,167 38,494 37,110 33,282 28,076 16,409 25,048 10,762 10,587 9,645 8,544 8,713 27,907 31,758 23,637 26,348 16,335 19,532 FY 14 FY 15 FY 16 FY 17 FY 18 FY 19
Slide 35: Revenue Composition
Revenue Composition Revenue by Verticals Offshore/Near-shore to Onshore Onshore Offshore/Nearshore Telecom & Technology Consumer Products Healthcare BFS Others 15.3% 11.7% 9.9% 10.0% 9.5% 14.7% 6.9% 7.3% 8.0% 8.0% 7.8% 8.3% 39.7% 42.3% 43.1% 46.5% 47.0% 44.3% 34.9% 41.8% 45.9% 49.2% 52.2% 50.3% 13.7
Slide 36: Revenue Composition
Revenue Composition Revenue by Delivery Revenue by Originations INR USD GBP CAD India Philippines USA UK Canada Jamaica 3.3% 4.7% 4.3% 4.6% 17.7% 12.2% 10.3% 9.9% 11.7% 10.0% 12.7% 10.6% 10.2% 11.7% 10.0% 17.7% 5.3% 8.6% 6.9% 5.9% 5.3% 10.5% 8.6% 6.9% 5.9% 10.5% 10.6% 10.6% 25.2% 25.1% 26.8% 32.8% 3
Slide 37: Revenue Composition
Revenue Composition Voice to Non-Voice Mix OPEX seats & Owned Seats Voice CRM Transaction processing Digital CRM Owned Seats Seat for Opex 22.4% 22.1% 22.3% 21.2% 3% 3% 4% 4% 19.8% 7% 8% 21% 8,817 9,507 10,260 23% 24% 24% 9,345 9,443 25% 24% 35,690 35,372 35,557 32,951 32,968 77% 74% 73% 73% 68% 67%
Slide 38: Revenue Composition: Client Concentration
Revenue Composition Client Concentration Top Client Top 5 Clients Top 20 Clients 77% 75% 73% 72% 71% 72% 50% 50% 51% 48% 48% 46% 16% 18% 18% 17% 17% 15% FY 15 FY 16 FY 17 FY 18 FY 19 Q1 FY 20
Slide 39: Highly Tenured Clients
Highly Tenured Clients Focus on building partnerships 14% 4% Client Tenure – Client Tenure – Below 5 years Over 20 years Quarterly Revenues Contributions Q1 FY 19 Q4 FY 19 Q1 FY 20 97 89 90 Revenue by Tenure 42 41 37 19 20 23 11 9 12 11 14 14 14% Client Tenure – 68% 5-10 years Client Tenure – Revenu
Slide 40: Thank You
CHGS Thank You
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