Care Ratings Ltd · NSE:CARERATING
Care Ratings — Q4 FY23 Earnings Presentation
39 slides from Care Ratings's earnings presentation, May 12, 2023
Slide 1: Exchange filing cover letter
Date: May 11, 2023 SE/2023-24/17 To, The General Manager The National Stock Exchange India Ltd. Corporate Relation Department Listing Department BSE Limited Exchange Plaza Phiroze Jeejeebhoy Towers Bandra Kurla Complex 14th Floor, Dalal Street Bandra (East) Mumbai 400 001 Mumbai 400 051 Scrip Code:
Slide 2: Investor Release: Standalone Financial Highlights
CARE Ratings Limited Care=dge Investor Release: 11't May 2023, Mumbai CARE Ratings Limited (NSE: CARE, BSE: 534804) The Board of Directors of CARE Ratings Limited have declared its audited financial results for quarter & full year ended 31% March 2023. Standalone Financial Highlights Rs. In Crs. Tot
Slide 3: Management commentary on Q4 & FY23 results
CARE Ratings Limited fare=a ee ———— EEE Commenting on the results and performance for Q4 & FY23, Mr. Mehul Pandya, Managing Director & CEO of CARE Ratings Ltd said: Over the past decade, India has made remarkable strides in economic development, rising from the tenth to the fifth largest economy in
Slide 4: About CARE Ratings Limited and Safe Harbor Statement
CARE Ratings Limited Care=dge ee ee —_— EEE About CARE Ratings Limited CARE Ratings Ltd. is one of India's leading credit rating companies with a track record of servicing diverse sectors for over 3 decades. It also provides credible and high quality research and analytics. The company's ratings cov
Slide 5: CARE Ratings Limited Q4 & FY23
CARE Ratings Limited Investor Presentation Q4 & FY23
Slide 6: About Us
% % ~ ss . . ° _ > yn - . ° > -* SS “ al ‘ Z : 7 — ~ _* “4 ™ > ~ _ — ~~e * -« “ . : ~ ~ ~ ~ . — > ~ . wor Anatutical Excellence About Usy
Slide 7: About Us: Who Are We
ABOUT US Who Are We Incorporated in 1993, CARE Ratings Limited is one of the leading credit rating agencies in India Rs 285.9 Crores 500 + 91,059 FY23 Total Income Employees Ratings Professionally managed company assignments Leader in large corporate ratings Dominant position in PSU ratings What we
Slide 8: CareEdge Turns 30
CareEdge TURNS 30 1993-1996 1997-2000 2001-2004 Commenced Rating Operations Launched ‘CARE Loan Ratings’ for rating term loans Founding member of Association of Credit Rating Expansion of ratings operations to rating of toll Ventured into Advisory business and bagged 13 Agency in Asia (ACRAA) roads,
Slide 9: CareEdge Group structure
CareEdge GROUP: FORESIGHT BACKED BY EXPERT INSIGHTS CareEdge Group CARE Ratings Limited (Parent Company) Subsidiaries 100% 100% 51% 78% CARE Risk Solutions CARE Advisory Research CARE Ratings CARE Ratings (Africa) Private Limited & Training Limited (Nepal) Limited Private Limited (CRSPL) (CART) (CRN
Slide 10: Ratings Business
RATINGS BUSINESS CareEdge Ratings CareEdge Rating – Africa One Of India’s Leading Credit Rating Agencies with a track record of servicing diverse sectors for over (Subsidiary of CARE Ratings Ltd. with 78% stake) three decades Offers a range of high-quality analytical services to the stakeholders Car
Slide 11: Rating Stability: In Sync with Industry Average
RATING STABILITY: IN SYNC WITH INDUSTRY AVERAGE Average One-Year Stability rates for the last 5 Financial Years' Period 100 97.29 97.72 100 92.43 93.61 91.30 91.64 90.93 91.17 88.67 89.06 80 78.11 79.20 80 60 60 40 40 20 20 0 0 AAA AA A BBB BB B 2018-2022 2019-2023 Average (FY19-23) 7
Slide 12: CART - Advisory Research and Training
CART - ADVISORY RESEARCH AND TRAINING CARE Advisory Research and Training Ltd (CART) offers services in the area of Corporate Advisory, Risk Advisory & Monitoring, Financial due diligence and Valuations, Industry Research and Customized Research, Gradings, ESG Assessment and ESG Advisory Corporate A
Slide 13: CART - ESG Solutions by CareEdge
CART - ESG SOLUTIONS BY CareEdge ESG Offerings Clientele ESG Data, Grading & Analysis and performance tracking for pre-determined KPIs along E, S & G Funds, FIs and Corporates Benchmarking parameters, along with a comparison against industry leaders and industry peers seeking ESG data ESG GAP Identi
Slide 14: CRSPL: Risk & Analytics
CRSPL: RISK & ANALYTICS Analytical Driven Risk Solutions 15+ years global experience in providing cutting edge Risk & Compliance solutions to Banks and Financial Institutions Sustained presence in more than 10 countries 80+ implementations across the globe 200+ experienced professionals assists acro
Slide 15: Macro Economic Indicators
Macro Economic Indicators 11
Slide 16: Lead Indicators: Fund Raising Activity in the Economy
LEAD INDICATORS: FUND RAISING ACTIVITY IN THE ECONOMY Corporate Bond Issuances CP Issuances Corporate Bond Issuances Up by 32% in FY23 CP Issuances Lower by 32% in FY23 (Rs. Lakh Crore) (Rs. Lakh Crore) 8.5 20.2 6.5 13.7 FY22 FY23 FY22 FY23 Source: Prime database Source: CEIC Corporate Bond Issuance
Slide 17: Lead Indicators: Bank Credit Offtake
LEAD INDICATORS: BANK CREDIT OFFTAKE Gross Bank Credit Growth Accelerates in FY23 Industrial Credit Growth Subdued, Credit to Services Picks Up (Y-o-Y ) (Y-o-Y ) 15.0% 19.8% 9.6% 8.7% 7.5% 5.7% FY22 FY23 Industry Services FY22 FY23 Source: RBI Source: RBI Gross bank credit growth gathered pace in FY
Slide 18: Lead Indicators: IIP, GST Revenue & PMI
LEAD INDICATORS: IIP, GST REVENUE & PMI IIP Growth Stays on Track GST Revenue & E-Way Bills Stay Buoyant PMI's in the Expansionary Zone (Y-o-Y %) 25 62.0 19.7 2.0 1.9 10 62 20 1.7 9 60 1.6 1.5 1.6 15 12.6 1.4 1.5 1.4 1.5 1.5 1.5 1.5 8 1.5 1.4 58 57.2 7 10 7.6 56 6.7 6 4.7 5.5 5.6 Rs. Lakh Crore 1.0
Slide 19: Lead Indicators: Inflation
LEAD INDICATORS: INFLATION Retail & Wholesale Inflation Trends Lower Average CPI Inflation across Categories (Y-o-Y % ) (Y-o-Y ) 18 16 11.3% 10.4% 14 9.5% 12 10 7.2% 6.7% 6.7% 6.7% 8 6.3% 5.7% 5.5% 6 4.2% 4.3% 4 3.7% 2 1.3% 0 Aug-22 Dec-22 Nov-22 Jun-22 Jul-22 Jan-23 Apr-22 Oct-22 Mar-23 May-22 Sep-
Slide 20: Lead Indicators: G-Sec and Currency
LEAD INDICATORS: G-SEC AND CURRENCY 10-Year G-Sec Yield Eases Rupee Stays Range-Bound (%) (USD-INR) 85.0 7.9 7.7 83.0 7.5 81.0 7.3 79.0 7.1 77.0 6.9 6.7 75.0 6.5 73.0 Jun-22 Oct-22 Apr-22 Sep-22 Feb-23 Mar-23 Apr-23 Jul-22 Aug-22 Nov-22 Jan-23 Dec-22 May-22 Jun-22 Oct-22 Apr-22 Sep-22 Feb-23 Mar-23
Slide 21: Financials
Financials 17
Slide 22: Standalone: FY23 Key Highlights
STANDALONE: FY23 KEY HIGHLIGHTS EBITDA PAT Rev. from ops 248.8 Cr 115.5 Cr 103.8 Cr (13% YoY) (34% YoY) (23% YoY) PBT Margin PAT Margin Operating Margin 46.4% 48.3% 36.3% 18
Slide 23: Standalone Financial Performance
STANDALONE FINANCIAL PERFORMANCE (Rs in Crore) Total Income EBITDA PAT 115.5 103.8 285.0 285.9 265.0 85.8 251.8 88.3 84.5 245.0 80.5 250.4 247.6 86.0 225.0 76.6 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 FY20 FY21 FY22 FY23 Total Income EBITDA PAT* 74.8 78.2 28.8 29.5 28.9 25.9 25.3 22.1 64.9 66.9 12.9
Slide 24: Financial Performance – FY23
FINANCIAL PERFORMANCE – FY23 (Rs in Crore) Standalone Consolidated Profit and Loss (Rs. Crs) FY23 FY22 YoY FY23 FY22 YoY Total Income 285.9 247.6 15.5% 316.9 274.8 15.3% Total Expenses 147.8 140.7 5.0% 191.2 176.2 8.5% Profit Before Tax 138.1 107.0 29.1% 125.7 98.6 27.5% Profit Before Tax (%) 48.3%
Slide 25: Financial Performance – Q4 FY23
FINANCIAL PERFORMANCE – Q4 FY23 (Rs in Crore) Standalone Consolidated Profit and Loss (Rs. Crs) Q4 FY23 Q4 FY22 QoQ Q4 FY23 Q4 FY22 QoQ Total Income 78.2 66.9 16.8% 87.9 73.1 20.3% Total Expenses 43.0 32.8 31.4% 53.8 45.7 17.8% Profit Before Tax 35.2 34.2 2.8% 34.1 27.4 24.5% Profit Before Tax (%) 4
Slide 26: Annual Dividend Payout
ANNUAL DIVIDEND PAYOUT Dividend 58% 59% 71% Payout 35.00 29.13 28.62 25 17 17 FY21 FY22 FY23 EPS DPS The above dividend is based on Face Value of Rs. 10 per share 22
Slide 27: Strategy
Strategy 23
Slide 28: Vision, Mission & Values
VISION MISSION & VALUES Strategy Vision A global research and analytics company that enables risk mitigation and superior decision making Re- branding Talent Mission To provide best-in-class tools, analyses and insights, enabling customers to make informed decisions Technology Values Group Approach
Slide 29: Building the Pillars of Success: Group Approach
BUILDING THE PILLARS OF SUCCESS: GROUP APPROACH The whole is more than the sum of its parts P4 Re- With almost three decades of experience in the analytics business and a deep branding understanding of the operations of various industries and sectors, CareEdge is in a sound position to offer itself
Slide 30: Building the Pillars of Success: Technology
BUILDING THE PILLARS OF SUCCESS: TECHNOLOGY Turbocharging with technology P4 Re- Deployment of more sophisticated data science capabilities across the CARE branding Group to build a data analytics organization P3 Talent Automated ratings workflow using cutting edge technology and continuous automati
Slide 31: Building the Pillars of Success: Talent
BUILDING THE PILLARS OF SUCCESS: TALENT People power to the fore P4 Re- Key focus areas: Identifying performers and putting them on a high-trajectory branding growth path, and employee centricity P3 Talent Evaluated present workforce strategy and built accountability across all levels by strengtheni
Slide 32: Building the Pillars of Success: Rebranding
BUILDING THE PILLARS OF SUCCESS: REBRANDING A power brand worthy of a financial powerhouse P4 Re- In sync with our legacy of being one of the leading rating agencies to now presenting ourselves as a technology-backed knowledge hub, the Company has branding rebranded itself and revamped the website t
Slide 33: Growth Drivers
GROWTH DRIVERS Credit demand accelerating; Bond Revival in capex; issuances picking up investment shows Corporate Bond Issuances green shoots Up by 32% in FY23 Corporate balance The share of the private Related to growth sector in new investment sheet stronger Deepening of bond market projects annou
Slide 34: Strong Governance: Board of Directors
STRONG GOVERNANCE: BOARD OF DIRECTORS AND… Mr. Najib Shah Mr. V. Chandrasekaran Mr. Adesh Kumar Gupta Ms. Sonal Gunvant Desai Chairman, Non-Executive Independent Director Non-Executive Independent Director Non-Executive Independent Director Non-Executive Independent Director Mr. Gurumoorthy Mahaling
Slide 35: Equally Strong Ratings Governance
…EQUALLY STRONG RATINGS GOVERNANCE Rating Sub Committee RSC has overall rating analytics oversight; Chief Rating Officer reports to RSC. Mr. Gurumoorthy Mahalingam Mr. Najib Shah Mr. Adesh Kumar Gupta Mr. V. Chandrasekaran Chairman Member Member Member External Ratings Supervision Committee Mr. K. N
Slide 36: Outreach Activities: Q4FY23
OUTREACH ACTIVITIES: Q4FY23 Reports & Publications: Reports Published Q4FY23 FY23 Daily 60 190 • CareEdge native edition of FORESIGHTS on LinkedIn - a power-packed monthly publication that gives a thorough understanding of some macroeconomic and sector-specific developments shaping the country has 1
Slide 37: CSR Activities
CSR ACTIVITIES • 50 underprivilege kids are beneficiaries of ‘SweetCARE’ project catering to Juvenile Diabetes • Primary education of 434 girls funded through project Nanhi Kali • Student beneficiaries of our Knowledge on Wheels, Samutkarsh Abhyasika: Study Center & Book Bank -Projects conducted thr
Slide 38: Safe Harbour
SAFE HARBOUR This presentation and the accompanying slides (the “Presentation”), which have been prepared by CARE Ratings 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 securities
Slide 39: Contact Us
CONTACT US Company : Investor Relations Advisors : CARE Ratings Limited Strategic Growth Advisors Private Limited CIN: L67190MH1993PLC071691 CIN: U74140MH2010PTC204285 Krunali Shah / Ami Parekh investor.relations@careedge.in krunali.shah@sgapl.net / ami.parekh@sgapl.net +91 98209 87564 / +91 80824 6