Axis Bank Limited · NSE:AXISBANK
Axis Bank — Investor Day (November 2022)
32 slides from Axis Bank's investor day presentation, Nov 24, 2022
Slide 1: GPS Strategy execution - Analyst Day 2022
GPS Strategy execution Analyst Day 2022 November 24th, 2022
Slide 2: Surpassed aspirational ROE target and structurally improved NIMs
Surpassed our aspirational ROE target and have structurally improved NIMs to deliver stronger, consistent and sustainable earnings 18.9% 3.96% Consolidated ROE Net Interest Margin (Q2FY23 Annualized) (Q2FY23 Annualized) Analyst Day 2022 2
Slide 3: Led by strong performance over the last three and half years
…led by strong performance over the last three and half years… 15.14% 80% 0.51% Strengthened the CET 1 PCR^ Net Bank significantly NPA 11.27% 62% 2.06% 18.90% 3.96% Core Op 13% Improved profitability Cons. NIM Profit considerably ROE CAGR* 8.58% 3.44% 4% 5.7% 4.7% 12% Lifted the growth Advance Depos
Slide 4: Exceeding our strategic goals articulated in 2019
…and exceeding our strategic goals articulated in 2019 Growth Profitability Sustainability ✓ Continue momentum in Retail Bank ✓ Optimize business mix ✓ Strengthen the Core - technology, operations, credit risk and process excellence ✓ Step up growth in Wholesale Bank ✓ Sweat existing infrastructure
Slide 5: Robust new customer acquisition trends across segments
Growth Profitability Sustainability Robust new customer acquisition trends across segments… New savings account New term deposits opened New liability relationships opened (in mn) (in mn) added (in mn) 61% 22% 43% 9.53 4.73 4.13 8.61 4.34 3.67 3.39 3.44 6.68 6.68 2.95 2.84 FY20 FY21 FY22 H1FY23* FY2
Slide 6: Higher Retail disbursements aided by productivity and digital
Growth Profitability Sustainability …yielding higher Retail disbursements, aided by productivity improvement and digital… Overall Retail assets and Rural Mortgage disbursements SBB disbursements disbursements (indexed) (indexed) (indexed) 2x 1.9x 4.6x 187 186 462 205 185 379 119 126 125 125 100 100
Slide 7: Strong growth in Credit Card issuances
Growth Profitability Sustainability …and strong growth in Credit Card issuances In million 9.0 8.8 ~ 2x 31% share of KTB^ sourcing to total card issuances in H1FY23 7.0 7.1 Cards In Force (net basis) 6.0 2.5x 11.4% 4.5 3.9 period end market share for credit cards in force as of Sep’22 2.7 Pre-covid
Slide 8: CASA growth higher than industry led by granular deposits
Growth Profitability Sustainability CASA growth trajectory remains higher than industry led by focus on granular deposits… Continue to deliver higher CASA growth than that for industry 22% 6.50% 20% 20% Incremental market share in CASA deposits in last 1 yr 17% 17% 16% 16% 15% 18% 14% 14% 15% 15% 15
Slide 9: Gained market share at district level across liability products
Growth Profitability Sustainability …and gained market share at district level across liability products No of districts with total No of districts with SA No of districts with CA No of districts with term deposits market share deposits market share deposits market share deposits market share greate
Slide 10: Leading player in India's Wealth Management space
Growth Profitability Sustainability Became a leading player in India’s Wealth Management space in the (In ₹ Bn) last 3 years Overall Burgundy AUM^ has grown steadily 26% CAGR 30 2,688 of the 100 Richest Indians are 2,608 Burgundy Private clients 2,131 948 870 Burgundy 500 Private 25% YOY 1,470 Growt
Slide 11: Most comprehensive Wholesale Banking franchise
Growth Profitability Sustainability Amongst the best and most comprehensive Wholesale Banking franchise We have evolved our business model over the last 5 years Deal based lending focus Dominant player across capital structure (pre-2017) (2022) • Transaction-based revenue; credit as an anchor • Rela
Slide 12: Significant value creation in key group entities
Growth Profitability Sustainability Significant value creation happening in our key group entities All figures in ` Crores One of the fastest Leadership position in AAA rated NBFC with 3rd largest bank led Amongst the leading One of the major fintech Leading player on 4th largest private growing MF
Slide 13: Consistent improvement in shareholder return metrics
Growth Profitability Sustainability Delivered consistent improvement in shareholder return metrics Trend in Consolidated ROA and ROE 1.87% 1.54% 2.0 0% 1.8 0% 1.48% 1.29% Consolidated ROA 1.6 0% 1.4 0% 0.75% 1.2 0% 1.0 0% 0.8 0% 0.6 0% 0.21% 18.9% 0.4 0% 0.2 0% 0.0 0% 16.6% 15.6% 13.7% 8.2% Consolid
Slide 14: Significant improvement in NIMs while reducing RWA
Growth Profitability Sustainability Significant improvement in NIMs while reducing RWA steadily 7.75% NII to RWA 7.26% 4.08% Domestic NIM (Q2FY23) up by 7.07% 45 bps since Mar’19 6.78% NIM 6.21% 3.96% 600 bps Improvement in Avg QAB CASA as % of 5.79% period end CASA (since Mar’19) 3.60% 3.51% 3.53%
Slide 15: Granularity built across fee income
Growth Profitability Sustainability Granularity built across fee income 9% 7% 6% 2% 1% 21% 3% 1900 bps 26% Improvement in proportion of 5% 27% granular fees since FY16 27% 29% 93% 16% 74% 7yr CAGR in Retail Fees 64% 67% 61% 45% 10% 7yr CAGR in Total Fees FY16 FY19 FY22 H1FY23 Corp & SME Credit fees
Slide 16: Self sustaining capital structure, asset quality dealt with
Growth Profitability Sustainability Self sustaining capital structure, asset quality adequately dealt with Includes 11 bps for 80% CET-1 Waterfall regulation led changes 75% 72% 69% 1.09% 1.18% PCR 62% 15.24% 15.14% 5.26% 4.86% 3.70% 2.82% 2.50% 2.06% 1.56% 1.05% 0.73% 0.51% CET-1 Mar'22 Accretion f
Slide 17: Multiple awards and recognitions
Growth Profitability Sustainability Our winning mindset is reflected in multiple awards and recognitions #1 for Large Corporate Won “Retail Banker’s International Digital Transformation and Best CRM System ‘Financial Inclusion Initiative of banking and Middle Market Asia Trailblazer”, for use of AI
Slide 18: World's highest rated Mobile Banking App
Growth Profitability Sustainability World’s highest rated Mobile Banking App, doubling up as our largest branch Bank on-the-go with Axis Mobile App Store Rating Hyper personalized | Intuitive | Seamless 4.8 Highest rating of 4.8 on Google Play Store with 15 lakh+ reviews across 4.6 59 global banks,
Slide 19: Organization wide transformation projects delivering results
Growth Profitability Sustainability Organization wide transformation projects have started delivering results Triumph (Liabilities) Zenith (Credit Cards) Unnati ( Retail Assets) 220 bps 1 mn+ 2x YOY improvement in Cards issued every quarter Retail disbursements by value as premium retail SA mix over
Slide 20: Risk culture and framework strengthened significantly
Growth Profitability Sustainability Risk culture and framework has been strengthened significantly Stronger risk frameworks Systematic interventions • Robust ERM framework establishing • Enhanced credit risk frameworks – EWS risk governance and oversight models, policy intervention, onboard guardrai
Slide 21: Our ESG performance continues to get recognition
Growth Profitability Sustainability Our ESG performance continues to get recognition Among Top 10 FTSE4Good Index 1st 62% 23% Constituents of constituent for 6th Indian Bank to constitute an % of Independent, % of women MSCI India ESG consecutive year ESG Committee of the Board Non-Executive directo
Slide 22: Strategic bets for this decade and beyond
Strategic bets for this decade & beyond to make Axis Bank a distinctive winner Best in class Digital, Technology and Data Analytics capabilities Focus on higher RAROC ‘Bharat Banking’ and ‘MSME+MC’ segments Integrated Play leveraging on partnerships and ecosystems Delivering Distinctiveness - Custom
Slide 23: Best in class Digital, Technology and Data Analytics capabilities
‘Best in class’ Digital, Technology and Data Analytics capabilities Leader among peers to take the Cloud First approach 1500+ 430 people dedicated to digital member strong in-house 500+ deployments in CI/CD mode agenda product, engineering and design team Integration of Dev-Sec-Ops led to over 70% r
Slide 24: Dominant and growing player in Indian payments space
We are now a dominant and growing player in Indian payments space; which we believe gives us the ‘right to win’ 31.0% 18.0% 15.0% 16.0% 11.4% 7.4% 8.2% 4.7% 5.7% Deposits Advances NEFT RTGS Credit Cards Mobile Banking UPI BBPS IMPS 1st 1st 1st Among the first on UPI To go live on Account In terms of
Slide 25: Bharat Banking strategy to gain market share
‘Bharat Banking’ strategy to gain market share and drive higher growth Rural consumption is expected to grow 3x in …offering us huge opportunity to leverage our distinctive this decade*, reaching USD 2.1 tn by 2030… capabilities to drive higher profitability & tap PSL opportunity Huge Potential to i
Slide 26: MSME+MC segment a key growth area
MSME+MC segment a key growth area, delivering higher RaROC Increasing Supportive Favourable geo- Evolving digital formalisation of the regulatory and political shift & public infrastructure MSME segment government policies Govt’s Infra push ~30% ~ 12 mn China plus One Udyam registered Platforms (GST
Slide 27: Strong growth in MSME+MC book despite tighter risk standards
Strong growth in MSME+MC book despite tightening our risk standards 20% 18% 15% 14% 1,43,465 28% CAGR* 28% 1,30,321 CAGR in combined MSME, MC and 29,915 SBB segment since Mar’20 43% CAGR* 26,481 94,041 77,601 17,148 78,209 18% CAGR* 12,213 75,223 51,620 59,034 11.25% 46% CAGR* Axis Bank’s Incrementa
Slide 28: Integrated Play leveraging One Axis, partnerships and ecosystems
‘Integrated Play’ leveraging on One Axis, partnerships and ecosystems Rise of networked and integrated ecosystem plays… …to offer tremendous opportunity to leverage our strong partnerships across segments 85 + Networked Integrated Co-dependent Partnerships across digital ecosystem 350 + Partnerships
Slide 29: Empowering Employees, Delighting Customers
Deliver Distinctiveness - Empowering Employees, Delighting Customers ‘Siddhi’ - the Super App that empowers Axis colleagues ‘Sparsh’ - the Customer Obsession Program at Axis to engage seamlessly with customers CX as a competitive edge and primary differentiator 83.9% of Banks surveyed^ agreed that C
Slide 30: GPS
Creating multiplicative forces through unification of digital platforms, partnerships, transformational projects and best in class analytics to win across businesses Digital 2.0. Partnerships Retail Assets Wholesale Retail Bank Liabilities Bharat Citi Banking GPS franchise Cards & Subsidiaries Payme
Slide 31: Key takeaways
Key takeaways Our strong performance The several steps we have The Bank’s Digital in the last 3 years taken over the last few capabilities and its demonstrates our ability years further strengthen ‘Connect & Grow’ to translate ‘intent’ to our capability to deliver philosophy to deliver ‘action’ towa
Slide 32: Thank You
Thank You A's BANK