corporate presentation – 31 march 2012 - aceanalyser meet/200040_20120529.pdf · net worth - rs....

Corporate Presentation – 31 March 2012

Investor Presentation Q4 FY12 11

1

Corporate Presentation – 31 March 2012

Overview

Business Systemically important NBFC with record of constant growth & profitability

ProductsComprehensive product suite to meet multiple needs of customers including Consumer Lending, Corporate Lending and Wealth Management services

Book Size Loan Assets of Rs. 46.70 bn (~ $ 912.9 mn*)

Profitability ROA at 2.46% and ROE at 13.41% for the year FY12


Management Professional Management Team with deep Industry Experience

People & Reach

1123 employees across 197 branches

Asset Quality High Asset quality – Secured assets with Gross and Net NPA at 0.08% & 0.001%

Networth & Rating

Net worth - Rs. 8.32 bn; Long Term: AA- & Short Term A1+ (CARE)

* $ Conversion rate = 51.15 on 30/31 March 2012, RBI

Our Vision

To provide MSME clients with capital and support the growth of

Micro, Small and Medium Enterprises in India.

To capitalize on growing “consumption” in India, which is a key driver of

the Indian economy.


To help our clients succeed by providing innovative product solutions,

high level of convenience, supported by robust technology.

To grow into a significant financial conglomerate and build businesses

of retail loans, corporate loans, Wealth Management & Equity broking.

Highlights FY ’12 vs. FY ’11

Loan Book

Increased by

64%

NII

Increased by

92%

PAT

Increased by

115%

Rs. 46,704 mn

Rs. 28,548 mn

Rs. 2,302 mn

Rs. 1,198 mn

Rs. 1058 mn

Rs. 491 mn


• Retail Loan Book has grown from Rs. 8,144 mn (EOP 31.3.2011) to Rs. 19,451 mn

(EOP 31.3.2012)

• Wholesale Loan Book has grown from Rs. 20,404 mn (EOP 31.3.2011) to Rs. 27,253

mn (EOP 31.3.2012)

• Networth has increased from Rs. 7,469 mn (EOP 31.3.2011) to Rs. 8,316* mn (EOP31.3.2012)

*EOP – pre dividend

Highlights Q4 FY ’12 vs. Q4 FY ’11

NII

Increased by

Fee Income

Increased by

PAT

Increased by

Rs. 644 mn Rs. 259 mn Rs. 267 mn


Increased by

17.5%

Increased by

18.3% Increased by

50.4%

Rs. 548 mn Rs. 219 mn Rs. 178 mn

Leadership


Leadership

FCH- Leadership

Independent Directors VC & MD

CEO- Retail Financial Services

G N Bajpai

Shailesh Haribhakti Chief Risk OfficerCEO-Wholesale

CFO andHead -Corporate

V VaidyanathanVice Chairman and Managing

Director


Financial Services

Apul Nayyar

(Citigroup, India Infoline)

N C Singhal

Anil Singhvi

Pradeep Mukherjee

K K Rathi

Pankaj Sanklecha

(ICICI Bank, Standard

Chartered Bank)

Wholesale Credit

Shailesh Shirali

(ICICI Bank, DSP Merrill)

Head -Corporate Center

Ashok Shinkar

(JM Morgan Stanley, Wanbury)

FCH – Management Team

Mr. V. Vaidyanathan is the Vice Chairman and Managing Director of FutureCapital Holdings (FCH). Prior to this, he was the Managing Director and CEO ofICICI Prudential Life Insurance Company Limited. He was earlier an ExecutiveDirector on the Board of ICICI Bank, He was also the Chairman of ICICI HomeFinance Co. Ltd, and served on the Board of ICICI Lombard General InsuranceCompany and CIBIL, India’s first credit bureau. He worked with Citibank Indiafrom 1990 to 2000.

At ICICI Bank he set up the bank’s Retail Banking Business since its inception in2000 and managed it till 2009. He also built the SME business and Rural


2000 and managed it till 2009. He also built the SME business and RuralBanking Business for the bank. His contribution includes building 1400 Retailbranches in 800 cities, a large Deposit base, a loan book of USD 30 billion inMortgages, Auto and Consumer loans, Private Banking, 25 millioncustomers, and a team of 26000 employees and taking ICICI Bank to marketleadership. The Retail banking Business was a key driver to help transition ICICIfrom a Domestic Financial Institution to a Commercial Bank.

His contribution won many domestic and international awards, Best Retail bankin Asia 2001, “Excellence in Retail Banking Award” 2002, Best Retail Bank inIndia 2003, 2004, and 2005 from the Asian Banker, “Most Innovative Bank”2007, and nominated for “Retail Banker of the Year” by EFMA Europe for 2008.He is an alumnus of Birla Institute of Technology and Harvard Business School.

FCH – Management Team

Apul Nayyar, CEO-Consumer Business: Apul has been with FCH since Oct. ‘10. Prior to this, he was the ED & CEO of India Infoline

Investment Services (Credit & Financing arm of India Infoline Group), CEO – Moneyline Credit, CEO & Manager – India Infoline HousingFinance. He contributed significantly to the start up and development of various business models. Prior to joining IIL, he was with DSPMerrill Lynch as Co-Head – Consumer Finance, Global Structured Finance & Investments and Co-CEO – Moneyline. He has also workedwith Citifinancial Consumer Finance where he was involved in setting up of operations of different products under retails financebusiness, retail financial product development and administration of marketing and distribution thereof, Human ResourceManagement, Risk Management, Product Portfolio Management, managing treasury and investments, fund raising, etc. Overall, Apul has14 years of experience in the financial services sector. Apul is a Bachelor of Commerce from Delhi University and a CA by profession.

Shailesh Shirali, CEO – Wholesale Credit: Shailesh jhas been with FCH since July 2008. Prior to this he was MD – Global Structured

Finance and Investments at DSP Merrill Lynch Capital Limited, India. At DSP Merrill, he was responsible for the start up and building up ofthe on-shore and off-shore structured lending business to Indian companies. Prior to joining DSP Merrill, Shailesh was with Rabo IndiaFinance Limited (RIF), a 100% subsidiary of Rabobank, as ED responsible for Leveraged Finance, Acquisition Finance, Telecom andInfrastructure and Structured Finance which included both on-shore and off-shore lending to Indian companies as well as originatingadvisory business for Investment banking and Syndication. During his 5 years with RIF from 2001 to 2006, Shailesh contributedsignificantly towards making the India credit business among the most profitable franchises in Rabobank Asia. Shailesh started his career


significantly towards making the India credit business among the most profitable franchises in Rabobank Asia. Shailesh started his careerwith ICICI Limited where he was with the Credit Risk Group and the Structured Finance Department from 1993 to 2000. Overall Shailesh haspost qualification experience of over 17 years in the financial services industry. He is a BCOM from Mumbai University and is a CA.

Ashok Shinkar, Corporate Centre Head & CFO: Prior to FCH, Ashok was on the Board of Wanbury Limited, a Pharma company. He

headed finance function & also handled strategy, accounts, taxation, mergers and acquisitions and financial resources mobilizations etc.Prior to joining Wanbury, he was associated with SSKI Corporate Finance for more than 4 years as a Vice President and handled CorporateFinance Advisory; M&A; Private Equity; Debt and Equity Structuring; and Merchant Banking activities. Ashok has also worked with J MMorgan Stanley for around 7 years in the field of Investment banking activities including merchant banking, corporate and financialadvisory in various sectors including power, oil and gas, infrastructure, Pharma, iron and steel etc. Ashok is a Bachelor of Commerce fromSydenham College of Commerce & Economics, Mumbai and a Chartered Accountant by profession.

Pankaj Sanklecha, Chief Risk Officer: Pankaj is a qualified chartered accountant with 15 years of experience in Retail and SME bankinghaving held leadership positions across risk and business. Prior to FCH, Pankaj was with Standard Chartered Bank for 7 years where hewas the Head of Credit for Retail Lending managing a portfolio of close to $ 2.5 billion. He was also responsible for Portfolio buyouts andsell downs and has been credited for building a stable, healthy and profitable mortgage portfolio of approx $ 2 billion at StandardChartered Bank. He has earlier worked with ICICI Bank and GE Capital in senior risk management positions.

Products, Services &


Products, Services & Distribution

Comprehensive Services Suite for all 4 key needs of consumers

Borrowing needs Protection needs

Mortgages (for SMEs)

Gold Loans

Consumer Durable Loans

Two Wheeler Loans

Home Loans

Auto Loans

Wholesale loans and syndication

Distribution of :

Life Insurance

General Insurance

Auto Insurance

Health insurance

Personal accident insurance

Travel insurance

Consumer


Investment needs Planning needs

Distribution of :

Property Broking

Mutual Funds

Real Estate Funds

Equity Broking

Commodity Broking

Estate Planning- Creation of Private Trust

Wills Creation

Real estate Advisory

Wealth Management Financial Planning

Consumer

Lines of Businesses

FCH – Lines of Business

Loan Against Property

Home Loan

Consumer Durable Loan

Loan Against GoldRetail

Business


Loan Against Gold

Two Wheeler Loan

Auto Loan

Wealth Manager & Broking

Wholesale Credit

Wholesale Loan Syndication

Business

Wholesale

Business

19%29%

42%81%

71%

58%

14.95

28.55

46.70

10.00

20.00

30.00

40.00

50.00

Rs.

bn

Loan Book

Loan Book

CAGR: 77%

Loan Book Growth & Composition Composition Retail Finance Loan Book (31 Dec’11)

79.4%Personal Loan

CD

Mortgage Loans

LAG

LAS

Auto Loan

2-Wheeler Loan


19%29%

0.00

FY10 FY11 FY12

Retail Credit Wholesale Credit Total Loan Book

• Retail as a % of overall loan book has increased from 19% in FY10 to 42% as of 31 March 2012

• The Company plans to increase the contribution of retail loan book to the overall loan book

0.9%

2.3%12.0%

1.1%3.6%

0.7%

2-Wheeler Loan

Branch Network

Through an Extensive Branch Network, FCH has reachedCustomers across most of the states and major cities(Tier -1, Tier -2) in India

Delhi & NCR

Bhopal

Chandigarh:Dehradun

Jaipur

Jalandhar:

Jodhpur

Lucknow

Ludhiana

Udaipur

Ahmadabad

Ajmer

Amritsar:

Kotta


Total 197

Branches

Mumbai& Thane

Pune

Bangalore

Hyderabad

KolkataBaroda

Bhubaneswar

Coimbatore

Indore

Nasik

Nagpur

RaipurRajkot

Surat:

Salem

Vellore

Vizag

Ahmadabad

Chennai

Processes


Processes

Underwriting controls

• At Future Capital, there is segregation of authorities and responsibilities across all functions. Sales, credit, operations and collections are independent of each other, with independent reporting lines.

• We underwrite all loans on the basis of cash flow capability of the customers as well as LTV norms.


customers as well as LTV norms.

• Proposals are checked with credit bureaus, and loans are approved only if the customers have a clear record with India’s leading Credit Bureau, CIBIL.

• A robust collections infrastructure is in place.

• Industry Experience

• Bureau Analytics

• Macro Environment

• Industry Experience

• Bureau Analytics

• Macro Environment

Retail Lending Process- Independent Specialized Verticals.

Customer Acquisition Credit PolicyCredit

Underwriting

• Credit Appraisal

₋ Cash flow checks

₋ Security check

₋Profile Check

• Credit Appraisal

₋ Cash flow checks

₋ Security check

₋Profile Check

• Advertisements / Sales

Promotions

•Developer and Dealer Tie

ups

• Advertisements / Sales

Promotions

•Developer and Dealer Tie

ups


• Statistical Scorecards

• Business strategy

• Competition benchmark

• Statistical Scorecards

• Business strategy

• Competition benchmark

₋ Bureau Check

• Application Scorecard

• Fraud Verifications

• Collateral valuation /

Title check

• Legal documentations

₋ Bureau Check

• Application Scorecard

• Fraud Verifications

• Collateral valuation /

Title check

• Legal documentations

•Manufacturer Tie ups

• Cross Selling tools

• Corporate Tie ups

• Referral Programs

•Manufacturer Tie ups

• Cross Selling tools

• Corporate Tie ups

• Referral Programs

• Loan Booking on system

•PDC / ECS banking and

Archival

•Collateral ( property and

• Loan Booking on system

•PDC / ECS banking and

Archival


Retail Lending Process- Independent Specialized Verticals.

Loan

ManagementCollections

•Collection Strategy

• Analytical models

•Planning calls and visits

•Collection Strategy

• Analytical models

•Planning calls and visits

• Analytics & Risk

Segmentation

• Bureau Usage to

monitor Customer

Leverage and Performance

• Analytics & Risk

Segmentation

• Bureau Usage to

monitor Customer


Portfolio

Analysis



RC copy ) storage in Strong

room

•Customer Relationship /

Request Management


RC copy ) storage in Strong

room

•Customer Relationship /

Request Management

• Planning Intensity of call

• Collection Efficiency

•Productivity

management

•Legal recourse

• Planning Intensity of call

• Collection Efficiency

•Productivity

management

•Legal recourse


• Cross sell / top up

• Exit Strategy


• Cross sell / top up

• Exit Strategy

Mortgages - Application to Approval Ratio

-7

-39

Rigorous and robust credit assessment processes in FCH help in maintaining the high assetquality and low NPA levels

In Mortgages, only 29% of the total applications aredisbursed after passing through several levels ofscrutiny and checks, mainly centred around cashflow evaluation, credit bureau and reference checks


100

29

-5

-10

-10

Application CIBIL Reject Insufficient

Cash Flow

Personal

Interview

Defective Title

Deeds

Others Disbursals

Provisioning Norms


Provisioning Norms

Participation BC

Particulars FCH Norms RBI Norms

Loans other than Mortgage Loans

90 days overdue 10% provision -

120 days overdue 33% provision cumulative -


180 days overdue 100% write off 33%

360 days overdue - 66% cumulative

Conservative Provisioning Norms

FCH maintains a much stricter provisioning norms compared to the regulatory norms as requiredby the RBI


Participation BC360 days overdue - 66% cumulative

540 days overdue - 100%

Loss Assets - 100% write off

SME Mortgage Loans ( Loan against Property) and Home Loan

90 days overdue 10% provision -

180 days overdue 33% provision cumulative 10%


720 days overdue 100% write off 20% cumulative

1080 days overdue - 50% cumulative

1800 days overdue - 100%

Loss Assets - 100% write off

Funding Pattern


Funding Pattern

18.23%

8.07%4.56%

Borrowings

36%

20%

0%

24%

Borrowing Portfolio Composition Borrowing Portfolio Composition


57.43%

11.71%

Term Loan NCD Cash Credit

Short Term Loans Sub Debt

20%

20%

Term Loans Cash Credit / WCDL NCD

Sub - Debt Commercial Paper

Borrowing portfolio – Rs. 25,630 mn(as on Mar 31, 2011)

Borrowing portfolio – Rs. 43,863 mn(as on Mar 31, 2012)

Asset-Liability Management – Structural Liquidity

120917756 6286 8279

3493

18650

26747

90336278 3199

3273

8029

14656

1593315924

10845

10624

0


All Figures In Rs. mn, Unless Otherwise Specified

ParticularsApr'12-Mar13

Apr'13-Mar14

Apr'14-Mar15

Apr'15-Mar16

Apr'16-Mar17

Apr 17 Onwards

Outflows 12091 7756 6286 8279 3493 18650

Inflows 26747 9033 6278 3199 3273 8029

Cumulative 14656 15933 15924 10845 10624 0

Apr'12-Mar13 Apr'13-Mar14 Apr'14-Mar15 Apr'15-Mar16 Apr'16-Mar17 Apr 17 Onwards

Outflows Inflows Cumulative

Shareholding


Shareholding

Shareholding Pattern

Particulars Value

No of Shares 64,798,484

No of Shareholders 146677

Face Value of Share 10

EPS – FY11-12 16.33

Shareholding Pattern as on 31 March 2012

Promoters, 56.3

%

Individuals, 14.8

Others, 7.0%


EPS – FY11-12 16.33

EPS – FY10-11 7.64

• The stock is listed on NSE (stock code: FCH) and BSE (stock code: 532938)

• Financial Institutions include Banks, Insurance Companies and other Financial Institutions• Others include NRI-Repatriable, NRI-Non-Repatriable, Clearing Members and Trusts

FII, 2.1%

Mutual

Funds, 1.9%

Financial

Institutions, 0.6

%

Bodies

Corporate, 17.3

%

Individuals, 14.8

%

Financial Updates


Financial Updates

Non Performing Assets

Particulars Unit Q4 FY12 Q4 FY11

Loan book Rs. mn 46,704 28,548

Gross Non - Performing Assets Rs. mn 36 71

Net Non – Performing Assets Rs. mn 0 18

% Gross NPA Rs. mn 0.08% 0.25%

% Net NPA % 0.00% 0.06%

Gross & Net NPA movement over the quarters


• The gross and net NPAs havereduced over the past 8 quartersand have remained at a low level

3.73%

2.60%

1.98%

0.27% 0.25% 0.05% 0.03% 0.04% 0.08%

0.00%

0.50%

1.00%

1.50%

2.00%

2.50%

3.00%

3.50%

4.00%

% Gross NPA % Net NPA

Consolidated Profit & Loss (YoY)

Particulars Q4-FY 12 Q4-FY 11 % Change

Interest Income 1,977.55 1,168.39 69%

Less: Interest Expense 1,319.51 662.15 99%

Net Interest Income (NII) 658.04 506.24 30%

Fee income 259.30 219.21 18%

Other Income 25.16 114.59 -78%

Total Income 942.50 840.04 12%



Total Income 942.50 840.04 12%

Opex 576.27 364.96 58%

Operating profit 366.23 475.08 -23%

Provision (3.36) 86.45 -104%

PBT 369.59 388.63 -5%

Tax 102.74 168.88 -39%

PAT 266.85 219.75 21%

Consolidated Profit & Loss (FY)

Particulars FY 12 FY 11 % Change

Interest Income 6,279.67 3,086.24 103%

Less: Interest Expense 3,976.97 1,887.48 111%

Net Interest Income (NII) 2,302.70 1,198.76 92%

Fee income 896.28 449.04 100%

Other Income 261.49 259.25 1%

Total Income 3,460.47 1,907.05 81%



Total Income 3,460.47 1,907.05 81%

Opex 1,719.25 942.59 82%

Operating profit 1,741.22 964.46 81%

Provision 225.28 125.89 79%

PBT 1,515.94 838.57 81%

Tax 457.63 347.36 32%

PAT 1,058.31 491.21 115%

ROE (%) 13.41% 6.66% NA

CAR (%) 18.63% 16.00% NA

Consolidated Balance Sheet (YoY)

ParticularsAs at

March 31, 2012As at

March 31, 2011

SOURCES OF FUNDS

Net worth 8,316 7,469

Loan funds 43,863 26,238

Total 52,179 33,707

APPLICATION OF FUNDS

Fixed Assets 1,087 918



Fixed Assets 1,087 918

Deferred Tax Asset (net) 69 60

Investments 228 1,849

Current Assets, Loans & Advances

Loan Book 46,704 28,548

Other current assets and advances 8,772 5,020

Less: Current liabilities and provisions 4,681 2,688

Net current assets 50,795 30,880

Total 52,179 33,707

THANK YOU


THANK YOUFuture Capital HoldingsIndia Bulls Finance CentreTower II, 15th FloorSenapati Bapat MargElphinston (West)Mumbai 400 013

Websitewww.futurecapital.in

E-mailInvestor Relations - [email protected]

Telephone+91 22 40423400


DISCLAIMERThis presentation and the contents therein are for information purposes only and does not and shouldnot construed to be any investment or legal advice. Any action taken or transaction pursued based onthe basis of the information contained herein is at your sole risk and responsibility and Future CapitalHoldings and/or its subsidiaries or its employees or directors, associates will not be liable in anymanner for the consequences of any such reliance placed on the contents of this presentation. Wehave exercised reasonable care in checking the correctness and authenticity of the informationcontained herein, but do not represent that it is true, accurate or complete. Future Capital Holdings orany of its subsidiaries or associates or employees shall not be in any way responsible for any loss ordamage that may arise to any person from any inadvertent error or omission in the informationcontained in this presentation. The recipients of this presentation should make their own verificationsand investigations to check the authenticity of the said information if they so wish. Future CapitalHoldings and/or its subsidiaries and/or directors, employees or associates may be deemed to haveinterests, financial or otherwise in the equity shares of Future Capital Holdings.

corporate presentation – 31 march 2012 - aceanalyser meet/200040_20120529.pdf · net worth - rs....

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