october 24, 2009 - india...
TRANSCRIPT
![Page 1: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/1.jpg)
Results for Quarter ending September 30, 2009October 24, 2009
![Page 2: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/2.jpg)
2
• Performance highlights
• Business review
• Corporate overview
• Industry
Presentation structure
Unless otherwise mentioned, facts and figures in this presentation refer to those for the India Infoline group (consolidated)
![Page 3: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/3.jpg)
3
Performance highlights‐ Q2FY10Overall consolidated financial performance
Income up 13.3%, PBT up 44.0% on yoy basis, Income up 22.3%, PBT up 18.7% on qoq basisWith rising top lines EBIDTA margin improves to 40.1% as compared to 37.4% in the previous quarterFor the quarter ‐ Income, PBT and PAT stood at Rs3,136 mn, Rs970mn and Rs580 mn respectively
BrokingAverage daily volumes in the quarter was Rs 33.36 bn, a 27% increase over the previous yearOverall market share in NSE maintained at 3.64%Commodities brokerage registers 36% yoy increase based on higher retail volumes and broader client base
Life InsuranceLife insurance distribution income registered 60.7% qoq growthThe company has started distributing life insurance products of major players
Investment BankingInvestment Banking‐ Improved environment for equities augurs well for investment bankingGlobal co‐ordinator and BRLM for QIP of Emami Ltd, Co‐BRLM for QIP of Cipla Ltd.
Credit and FinanceBook size Rs9.1 bn at the end of September 2009Loan growth likely to accelerate in 2HFY10, pick up in corporate and retail loans expectedBoard has been strengthened with eminent personalities
Asset/Wealth ManagementAssets under advisory crossed Rs35 bnA number of new products being introduced to meet requirements of clientsBoard of trustees for AMC have been approved
![Page 4: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/4.jpg)
Performance in pictures‐ Q2FY10Performance review
4
Revenues (Rs Mn)
EBITDA margin (%)
EBITDA (Rs Mn)
PBT (Rs Mn)
![Page 5: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/5.jpg)
Financial highlights‐ Q2FY10
Rs Mn Q2FY10 Q1FY10 Q2FY09 Y‐Y Q‐Q H1FY10 H1FY09 Y‐Y
Income from operations 3,133.3 2,562.6 2,760.5 13.5% 22.3% 5,696.3 5,444.4 4.6%Equities brokerage & related 1935.5 1,768.0 1,482.7 30.5% 9.5% 3,703.5 3067.7 20.7%Financing and Investment 726.7 488.8 808.5 (10.1%) 48.7% 1,215.6 1,458.4 (16.6%)Marketing and online media 106.5 96.1 205.1 (48.1%) 10.8% 202.7 380.9 (46.8%)Life Insurance distribution 134.5 83.7 158.8 (15.3%) 60.7% 218.2 314.4 (30.6%)Commodities brokerage & related 78.1 66.0 57.4 36.0% 18.3% 144.1 107.3 34.3%Wealth and Mutual fund advisory 115.0 50.9 31.0 271.0% 125.9% 165.9 94.5 75.5%Merchant Banking 37.3 9.0 16.9 120.8% 314.7% 46.3 21.3 117.2%Other income 2.3 0.8 6.3 (63.1%) 181.3% 3.2 12.8 (75.2%)Total Income 3,136.1 2,563.4 2,766.8 13.3% 22.3% 5,699.5 5,457.2 4.4%A. Direct cost 635.9 567.1 610.5 4.2% 12.1% 1,203.0 1,172.4 2.6%B. Employee cost 736.1 642.8 758.4 (3.0%) 14.5% 1,378.9 1,384.6 (0.4%)C. Administration expenses 507.1 395.4 518.7 (2.3%) 28.2% 902.4 1022.8 (11.8%)EBITDA 1,257.1 958.1 879.1 43.0% 31.2% 2,215.2 1,877.3 18.0%Interest 155.6 7.2 116.0 34.1% 2073.5% 162.7 252.2 (35.5%)Depreciation & amortisation 131.6 134.1 89.7 46.6% (1.9%) 265.6 174.7 52.0%Profit / (Loss) before tax 970.0 816.9 673.4 44.0% 18.7% 1,786.9 1,450.4 23.2%Provision for taxation 326.9 269.7 235.4 38.9% 21.2% 596.6 478.4 24.7%Profit/(Loss) after tax before minority 643.1 547.1 438.0 46.8% 17.5% 1,190.2 972.0 22.5%Minority Interest 62.8 30.4 35.9 75.1% 106.8% 93.2 74.5 25.1%Profit/(Loss) after tax 580.3 516.8 402.1 44.3% 12.3% 1,097.1 897.5 22.2%
5
![Page 6: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/6.jpg)
6
• Performance highlights
• Business review
• Corporate overview
• Industry
Presentation structure
Unless otherwise mentioned, facts and figures in this presentation refer to those for the India Infoline group (consolidated)
![Page 7: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/7.jpg)
Market share on NSE at 3.64% in Q2FY10
Average daily turnover up 3% qoq to Rs33.36 bn, a 27% rise over the previous year
Retail customer base has increased to 0.73 mn in Q2FY10
Present at 1,814 business locations, with over 500 own branches
IIFL is trading for most local institutions and over 100 global investors in India
Retail customer base for equity broking
7
Equities
IIL market shareEquities broking (Cash & FAO)
Performance review
![Page 8: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/8.jpg)
Research150+ stocks under coverage, targeting to double coverage universe
IIFL’s in‐depth, thematic research has been well received
Unique analysis of the ‘Indian Residential Real Estate Market’
An unorthodox take on the Chinese economy titled ‘The Frog Story’
INCH analysis on INdia and CHina as the next emerging financial super powers
A comprehensive update on emerging FMCG giants
Market Mantra, our daily comprehensive retail product covers market outlook, latest news, economy snapshot, personal finance insights, event notes, management meets, research ideas, etc
Our research is available on Thompson First call and our Research Team is ranked as Number 1 amongst the ‘Most Read Analysts’ in Thomson Reuters scoreboards
Research offering
Performance review
Comprehensive research on the emerging FMCG
giants
Focus is on bottom-up analysis, with a rigorous
industry overlay
The Frog Story: An unorthodox take on an
emerging economic superpower
INCH analysis on INdia and CHina as the next
emerging financial super powers
Market Mantra is a comprehensive daily retail
product
8
![Page 9: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/9.jpg)
9
InsurancePerformance review
Insurance mobilization in Q2FY10 stood at Rs410 mn, up 7% qoq but down 51% yoy
Insurance industry private sector volumes down 13% yoy for the first 5 months of current fiscal, but showing signs of revivalThe company has started distributing life insurance products of Max Life, Met Life, Reliance, Kotak, besides ICICI PrudentialSecond half of current financial year is expected to show further improvement with improving market scenario and traditional seasonality
Impact of IRDA changes in net yield to clients is difficult to ascertain now. Will have to wait for changes in commission rates by insurance companies which will be effective January 1, 2010
Changing product mix Income
![Page 10: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/10.jpg)
10
Credit and finance
Number of disbursals Portfolio break‐up
Performance reviewThe loans portfolio as on September 30, 2009 stood at Rs9.1 bn
Mortgages contribute to 51% of the lending book, followed by margin funding, LAS and personal loans at 17%, 16% and 16% respectively
Company provided funding for NHPC and Oil IPO’s which was a significant boost for income during the quarter
As a result of our prudent credit policies, the net NPA on the books continue to remain less than 1 %
Loan growth likely to accelerate in 2HFY10, pick up in corporate and retail loans expected
Shri M.N. Singh ‐ Former Director General of Police, Mumbai and Shri A.K. Purwar, ex‐Chairman of the State Bank of India, appointed as independent directors on the Board of India Infoline Investment Services Limited
![Page 11: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/11.jpg)
Assets under advise crossed Rs35 bn
Successfully sold IPO applications in the non‐institutional category for NHPC Ltd and Oil India Ltd to its wealth HNI customers and overseas clients
Expanded bouquet of structured product offerings with various issuers
Board of trustees for AMC has been approved and Shri A.K. Shukla, Shri R.S. Loona, Shri J.H. Mehta and Shri Nirmal Jain have been appointed as Trustee Directors of ‘India Infoline Trustee Company Ltd’
11
Wealth/Asset managementPerformance review
IIFL Private Wealth’s Product Proposition
Advisory Accounts
In‐house equity and debt advisory
‘Pure Advisory’agreements
Derivatives and Options strategy
Real Estate advisory
Private Placements
International platform
Structured Notes
Term Cover insurance
Executionary Platform
In‐house equity broking
NBFC credit
Commodity trading
Currency trading
Custody and Trust
Family Office proposition
Trust services and succession planning
Managed Accounts
Independent Asset Managers
Partners for the USD 200,000 opportunity
Commodity and currency PMS/trusts
Mutual Funds
RE and PE Funds
![Page 12: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/12.jpg)
12
• Performance highlights
• Business review
• Corporate overview
• Industry
Presentation structure
Unless otherwise mentioned, facts and figures in this presentation refer to those for the India Infoline group (consolidated)
![Page 13: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/13.jpg)
Corporate overview
The journey so far
13
2 3 4 3 919
55
106
256241
3 822
35
101
73
2 618
29
7155
2 5 12 19
4836
-50
0
50
100
150
200
250
300
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
Revenues EBITDA PBT PAT
Launched www.indiainfoline.com
IIFL Wealth launched
Insurance broking approval
‘Best Broker’ award
Commodities broking
Launched PMS
Listing on NSE, BSE
Launched proprietary trading platform
DGCX membership
CLSA team joins
Formed IIFL (Asia) Pte Ltd
(USD
Mn)
Launched online trading
Became corporate agent for ICICI Prudential
Started distribution of financial products
Launched proprietary platform for online trading
Housing Finance registration
In‐principle approval for Mutual Fund
Venture Capital license
FII registration
![Page 14: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/14.jpg)
Awards and accolades
MOST IMPROVED ‐INDIA
Awarded ‘Most Improved
brokerage’ in India by AsiaMoney as a part of its survey of
brokerages in countries across Asia for 2008
BEST BROKER ‐INDIA
Awarded ‘Best Broker‐India’ by FinanceAsia as a part of its survey of financial services firms across Asia for
2008
14
Performance review
FASTEST GROWING ‐LARGE BROKER
Awarded ‘Fastest growing Equity Broking House –
Large firms’ in India for the year 2008 by Dun & Bradstreet
![Page 15: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/15.jpg)
Focus on core competence in financial services
Multiple products and diverse revenue streams ensure de‐risked businesses
Asset‐heavy or long‐gestation businesses through separate JVs/ group companies
Drive customer stickiness through quality advice, best value and a delightful experience
Cutting‐edge proprietary technology for execution, back‐office and customer service
Wide, multi‐modal network serving as one‐stop shop to customers
Business Strategy Customer Strategy
Shareholders: High ROCE, ROE
Customers: Value and experience
Employees: Rewards and growth
TO BECOME THE MOST RESPECTED COMPANY IN THE FINANCIAL SERVICES SPACE
Vision
Vision and strategy
15
![Page 16: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/16.jpg)
Corporate governance
Eminent independent directors
Sat Pal Khattar
A.K. Purwar
Nilesh Vikamsey
Kranti Sinha
M. N. Singh
Non‐executive Director
Independent Director
Independent Director
Independent Director
Independent Director
India Infoline Ltd
India Infoline Ltd
India Infoline Investment Services Ltd
India Infoline Ltd
India Infoline Ltd
India Infoline Investment Services Ltd
Name Designation Company
Category‐wise shareholding (%)
MFs, UTI, FIs, Banks
16
![Page 17: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/17.jpg)
17
Corporate structure
India Infoline Ltd.(Bloomberg: IIFL IN)
India Infoline Commodities Ltd.
India Infoline Investment Services Ltd.
India InfolineMedia & Research
Services Ltd.IIFL Realty Ltd.IIFL (Asia) Pte. Ltd.
IIFL Wealth Management Ltd.
Moneyline Credit Ltd.
India Infoline Housing
Finance Ltd.
India Infoline Distribution Co. Ltd.
India Infoline Insurance Brokers
Ltd.
IIFL Ventures Ltd.IIFL Capital Ltd.
* The above chart does not cover all group companies
India Infoline Marketing
and Services Ltd.
India Infoline Insurance Services
Ltd.
![Page 18: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/18.jpg)
18
Corporate overview
Management team with proven track record
Team with impeccable academic and professional credentialsOpen door, transparent and performance oriented cultureIncreasing level of employee ownership
Institutional Equities
Investment Banking
Consumer Finance
Retail Broking
Wealth Management
International Operations
H. Nemkumar, Vasudev Jagannath, Aniruddha Dange
Ajit Menon,Donald D’Souza
Apul Nayyar
Nandip Vaidya
Karan Bhagat, Yatin Shah
Bharat Parajia
Key Management Personnel
Finance
Compliance
Operations
Audit & Risk
Human Resources
Technology
Kapil Krishan
R Mohan
Narendra Jain
Upendra Jaiswal
Capt R Sharma
Sankarson Banerjee
Offshore Asset Management Deepesh Pandey, Manish Srivastava
Insurance Distribution Sateesh Kumar
Corporate FunctionsVerticals
![Page 19: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/19.jpg)
Well‐diversified financial services companyBusiness and Strategy
19
Retail Affluent
InstitutionalCorporate
•Wealth management•Advisory• Financing
•Equities•Mutual funds• Insurance
• Institutional equities•Derivatives
• Investment banking•Corporate debt
CUSTOMERSEGMENTS
Our service offerings
Equities
Insurance
Credit & finance
Wealth management
Asset Management
Investment banking
![Page 20: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/20.jpg)
How we differentiate ourselvesBusiness and Strategy
20
![Page 21: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/21.jpg)
21
• Performance highlights
• Business review
• Corporate overview
• Industry
Presentation structure
Unless otherwise mentioned, facts and figures in this presentation refer to those for the India Infoline group (consolidated)
![Page 22: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/22.jpg)
EquitiesTotal derivatives market turnover (Rs bn)Total cash market turnover (Rs bn)
Source: Bloomberg, IIFL ResearchSource: Bloomberg, IIFL Research
Delivery Volumes have risen sharply Institutional Share of cash market volumes
Source: Bloomberg, IIFL Research. Based on provisional data from the exchangesSource: Bloomberg, IIFL Research
22
![Page 23: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/23.jpg)
Insurance
Up to August 2009, Source: IRDASource: IRDA
Source: IIFL Research Source: IIFL Research
APE growth yoy (%)APE market share (%)
Annual non‐life insurance premiums Annual life insurance premiums
23
![Page 24: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/24.jpg)
Mutual fundsTop 5 AMCs contribution (Rs bn)Total AUM for the industry (Rs bn)
September 2009, Source: AMFI September 2009, Source: AMFI
AUM as a % of GDP across countriesAUM comparison across countries (2008)
Source: IIFL Research Source: IIFL Research
24
![Page 25: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/25.jpg)
Capital raising and Fund flows
FDI inflows have been robust during the past three months
Source: Bloomberg, IIFL ResearchSource: Bloomberg, IIFL Research
Portfolio Flows have turned positive from the start of FY10
Ytd. capital raised through QIPs
Source: Bloomberg, IIFL Research
QIPs have been the largest source of capital
Source: Bloomberg, IIFL Research
25
![Page 26: October 24, 2009 - India Infolinecontent.indiainfoline.com/admin/...India_Infoline_2009-10_Q2_ppt_fin… · ¸Insurance industry private sector volumes down 13% yoy for the first](https://reader033.vdocuments.us/reader033/viewer/2022050517/5fa145a014ca1026f05a2a73/html5/thumbnails/26.jpg)
26
Thank youThank you
Published in October 2009. © India Infoline Ltd 2009‐10.
India Infoline Ltd. All rights reserved. Regd. Off: 75, Nirlon Complex, Off W E Highway, Goregaon (E) Mumbai‐400 063. Tel.: +(91 22)4007 7000 Fax: 2685 0451.
This report is for information purposes only and does not construe to be any investment, legal or taxation advice. It is not intended as an offer or solicitation for the purchase and sale of any financial instrument. Any action taken by you on the basis of the information contained herein is your responsibility alone and India Infoline Ltd (hereinafter referred as IIL) and its subsidiaries or its employees or directors, associates will not be liable in any manner for the consequences of such action taken by you. We have exercised due diligence in checking the correctness and authenticity of the information contained herein, but do not represent that it is accurate or complete. IIL or any of its subsidiaries or associates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this publication. The recipients of this report should rely on their own investigations. IIL and/or its subsidiaries and/or directors, employees or associates may have interests or positions, financial or otherwise in the securities mentioned in this report.