Time Technoplast Q3FY17 Concall Summary

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Financial Highlights

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  • The key performance numbers are in the Q3 FY 2017
  • The net sales on a consolidated level stood at Rs.670 Crores as compared to Rs.570 Crores in the corresponding period last year
  • EBITDA is at Rs.103 Crores as compared to Rs.85 Crores in Q3 last year and PAT at Rs.37 Crores as against Rs.28 Crores in the same period last year
  • Net sale is grown at 18% in value terms, the volume growth at 19%, EBITDA grew at 21% and the PAT went up by 31%
  • The net sale have been at Rs.1945 Crores as compared to Rs.1777 Crores, EBITDA is at Rs.293 Crores as compared to Rs.260 Crores last year and PAT at Rs.104 Crores as against Rs.86 Crores
  • In nine months period, the net sale has grown at 10% in value terms, in volume terms has 12% growth, EBITDA grew at 13% and the PAT grew at 21%
  • The net sales grew at 14%, in India sales grew at 11% and in overseas at 19%
  • The volume grew at around 15%, in India at 13% and overseas at 20% 
  • EBITDA grew by 16% and PAT grew at 23%
  • For Q3F17 the EBITDA margin improved by 45 basis points on year on year that would be – it is now at 15.30% as against 14.85% of sales
  • Finance cost reduced by 66 bps, which is at 3.29% as against 3.95% of sales
  • Net profit margin improved by 54 bps which is at 5.44% as compared to 4.90%
  • The net debt to EBITDA improved, is at 1.66 times of EBITDA as against 1.93 times of EBITDA in FY2016
  • ROCE improved by 136 bps y-o-y at 14.29% as against 12.93%
  • After 2007, company raised capital by Rs.150 Crores by the way of preferential issue of 16 Million shares to a specific investor in January 2017, which has been since been concluded successfully
  • EBITDA margin in overseas and Indian businesses are now almost the same
  • Net profit margins are higher in overseas businesses due to lower tax rate
  • The MOX Film operations have started only last week and received the product approved already
  • There is no capital commitment right now because company is using current capacity for the solar batteries, just a change of product and likewise for e-rickshaw
  • The EBITDA margin is 15% and 30% of business is coming from overseas
  • Witnessing EBITDA of about 18 or 20 Million US dollars which has been sold, is industrial packing company worldwide at EBITDA multiple of 10
  • In the beginning of the month, total debt is Rs.746 Crores and currently nine month, is in the range of Rs.725 Crores hence, paid nearly about Rs.20 Crores
  • For 700,000 cylinders revenue is Rs.150 Crores
  • Witnessing at the growth, company started in 1992 and are now at about Rs.2800 Crores
  • 15% EBITDA margin is not so bad that investor  would compromise on volume growth going forward
  • EBITDA margins have witnessed improvement by 0.44%
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Key Operational Highlights

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  • In nine months, India and overseas are operations grew in value by 11% and 19% y-o-y
  •  The margins were about 17%, 18% and are projected to be in excess of 20%
  • Supplied cylinders to Reliance gas, which are in operation for more than three years successfully by the company
  • In addition to the Reliance Gas is now wanting to roll out LPG distribution in the entire country and chosen a few cities in Maharashtra, Gujarat and in some other places are planning to launch LPG in composite cylinders
  • The company has approval for composite cylinders in 48 countries and are exporting it to 25 countries
  • This year, the share of business for telecom battery is 50% and the balance 50% is other batteries namely solar batteries
  • Maintenance, the research and development would be looking at Rs.75 to Rs.85 Crores for FY 2018
  • Infrastructure is the pipes business which is the growth of almost about 30Company received corrugated pipes going up to 1600 mm in diameter which is especially for sewerage schemes, these pipes are to be buried deep inside the ground
  • The margins are very good and the product is a standard size of 1000 liters
  • The net working capital cycle days, which are ongoing 82 to 85 days, there is no any much gap is available as far in the current scenario
  • The Company will be increasing ROCE 2% every year and in 2020-2021, are looking at ROCE in excess of 21%, 22%
  • The internal target is ROCE should be minimum 10% higher than the lending weight in the market place
  • Witnessed the best growth in the pipe business in Q3, which is the demonetization time
  • The management was expecting the new development regulations to come in where by the floor space was to go up from 1 to 3.5 or 4 because that has been going on for quite a while
  • As far as the NCD is concerned, it is part of the plan to reduce interest cost and in due course, would be witnessing at other alternatives as well, which include NCD

Key Company Highlights

  • The company has tied up with the company in Indonesia and have a long-term contract with them
  • The company do not exposes to the Government and work with EPC contractors who take the water projects, for example L&T
  • The company is witnessing huge growth in the demand for the solar battery in which space have developed a battery, which is specially suited
  • They have developed a very specific battery for e-rickshaws .The e-rickshaws are growing very rapidly all over the country
  • The growth has been from composite cylinders on one side  and from PE pipes, which grown quite rapidly
  • The volume growth in this quarter of 19% volume growth was primarily industrial packaging which is a consolidated level more than 19%

Order book  

  • The company has an order book in excess of 1.8 Million cylinders , with staggered deliveries which is incumbent to increase the capacity
  • The order book is spread across many years - some of the orders will be going up to three years, but some can actually be in two years time

Capacity utilisation and Capex

  • The company have increased capacity for PE pipes from 18000 tonnes to 30000 tonnes
  • The capacity utilization stands at 87% in India and 67% overseas
  • The Company successfully completed the project for multi-layer multi-axial oriented cross-laminated film, which is called a MOX Film and this unit has now gone into operation
  • The product has already been approved as per BIS in fact and exceed their specification which are on the way to get the BIS
  • The companyhas also completed Brownfield expansion in Egypt for manufacturing IBCs which is 1,000 liter intermediate bulk containers
  • The company has enhanced production capacity for composite cylinder from 700,000 cylinders to 1.4 Million cylinders which will become operational in Q1 of the next financial year
  • It has a capacity of 700,000 cylinders now, this year will end up doing 350,000 cylinders at the end of the year
  • The capacity utilization in H2 which was about 65% to 70% since the capacity build up takes times
  • Every single IBC in country cannot have a capacity utilization more than 35% or 40% whereas in drums, capacity utilization could be as high as 80% or 85% and when combined it together, it comes down to 65% 
  • The capacity utilization islow overseas. The capacity overseas includes the capacity of IBCs and in most countries where company have received IBC, gone for the minimum economic size of 100000 IBCs a year, but that market is not more than 35000

Guidance

  • Expecting 20% growth in the next year
  • The value growth will be about 15% and may be the volume growth could be a little more than the value growth
  • This year have planned going up to 2020-2021 and as per the plan, are witnessing at a growth of 15% every year going up to 2020-2021
  • The company has not factored in any revenue in the current financial year but with the capacity of 6,000 tonnes, can expect a total turnover of about Rs.200 Crores from the operations
  • The EBITDA margin in the product is expected to be in excess of 20%
  • The tax rate will be in the range of 25% this financial year
  • The EBITDA would be in the range of 15% and already have reached that level which will be between 15% and 15.5% 
  • A growth overseas like 19% this year, next year it will be in excess of 19% 

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Fiberweb Q1FY18 Concall Summary

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Company Background & Business Overview

  • Fiberweb is a pioneer and amongst the leading players in manufacturing of Spun bond woven fabric in India.
  • It was established as a plastic moulding company in 1986 and it forayed into manufacturing Spun bond non-woven products in 1995.
  • The company exports products to USA, UK, Europe, New Zealand, Australia, UAE & South Africa
  • The company crossed the INR 100 cr. topline for the first time in 2017 and has become an approved supplier to Lowe leading to being approved supplier to Walmart in USA.
  • Johnson & Johnson, P&G, Unichem are some of the well renowned customers of Fiberweb along with many others as well.

 Business Segments

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  • The company manufactures diverse products across 3 main categories.
  • Among 3 segments that company serves, the products for Personal hygiene segment form 30% of total production and are supplied locally to customers like J&J, Unichem and many others. These products are not exported
  • Rest 70 % are exported, with 40% in agricultural market and 30% goes in general textile market
  • This segment wise break up of production had been the same for years and would be the same even after the capacity expansion that company is undergoing as discussed ahead.  
  • Fiberweb  has 100% Export oriented units and 70% of revenues come from exports out of which 80% came from USA, 10% from UK and 8% from in 2016.
  • Reason behind the large exports to USA is that first of all, large number of orders comes from USA and the order size from USA is of 50-100 containers as compared to 1-2 containers from Europe and other markets. The large order size results in continuous production for weeks, 24*7 and in continuous process industry, less the change, better is the profitability. Thus, USA is a preferred customer due to bulk orders.

Financial Highlights

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  • The Q1 is generally the worst quarter among all other quarters.
  • It is because the order pattern in USA (the biggest customer contributing 80% of exports revenue) is such that orders for an entire year till next June are placed in July-August. As the prime season is April-May, products are to be delivered latest by April and so units run at full capacity for 3 quarters and at less capacity in Q1 due to the seasonality.
  • The Q1, FY 2018 has posted phenomenal results on account of better product mix and continuous inflow of orders from new and existing clients across globe
  • Revenue grew by 313% YoY, from INR 13 cr. in Q1, FY 2017 to INR 53 cr. in Q1, FY 2018
  • EBITDA registered a strong growth of 181% YoY, from INR 3 cr. in Q1, FY 2017 to INR 8.4 cr. in Q1, FY 2018
  • Profit after Tax (PAT) increased by an exceptional 231% YoY, from INR 2.3 cr. in Q1, FY 2017 to INR 7.7 cr. in Q1, FY 2018
  • EPS in Q1 FY 2018 grew by 211% at INR 5.7 as compared to just INR 1.8 in Q1 FY 2017
  • The company has become a zero debt company and net worth turned positive in Q1, FY 2017
  • The companyhedges its sales proceeds to protect it from exchange rate fluctuations and any potential loss. This quarter company had a profit of INR 32,000 in the foreign exchange. It was shown in the other income section of P&L statement
  • The company has decided for NSE listing and has assigned the task to concerned people for the same and is expecting to get listed by Q3, FY 2018.
  • The company's cost of raw materials has increased from INR 5.5 cr. in Q1, FY 2017 to INR 41.6 cr. in Q1, FY 2018. It has happened as the company had engaged in trading activity at UAE in this quarter. So, consolidated results include this trading activity
  • Under trading activity, company procures finished products from other manufacturers from China, East Asia and sells them at UAE. Because of this activity along with the rise in prices of raw materials, the cost of raw material has increased.
  • Also, In order to maximize profit, the company has adopted the strategy of higher production by only taking the orders for higher grammage. And even though the costs have increased, but there has been corresponding increase in the Bottom line as well
  • ExxonMobil has remained the supplier of the raw materials since past 20 years.

Expansion Plans & CAPEX

  • The company has a total installed capacity of 7500 MT at present. 
  • They have two units, one with 5000 MT capacity and other with 2500 MT capacity, located at Daman (U.T.). The Unit-I use unique double beam technology with diverse applications, supplied from renowned manufacturer, Reifenhauser Gmbh, Germany.
  • Unit- I produce high quality products accepted by large companies as end-users across developed countries. The Unit -2 is a leased out facility with made by same German manufacturer
  • In order to meet the rising demand across markets (domestic & International), Company has planned a capacity expansion of 13000 MT out of which 12000 MT is to be installed and made operational in FY 17-18
  • The company has raised INR 32.58 cr. through preferential allotment to meet the capital expenditure of buying two machines- one with 10000 MT spun bound and another 3000 MT melt blown technology based machine)
  • With the expansion exercise, the company's total installed capacity would become 20500 MT
  • Capex on melt blown machine is about INR 20 cr. and for 10000 MT machine, it is about INR 80 CR.
  • Out of 3000 MT melt blown non-woven technology based products, 2000 MT will become operational by September 2017. And 10000 MT will get operational by end of FY 2018
  • The melt based technology is a very specialized one and the product manufactured by this machine is in short supply (25% difference between demand and supply) in the international markets, and the product offers great margins
  • Against about U.S.$ 2.1 for 1 kilo in Non-Woven market, this product price about $3.5 per kilo and the corresponding increase in the production cost is about 3% to 4%
  • It is estimated that melt blown products' profitability would be approximately 70% more than the normal non-woven products.
  • This product is mainly used in Filtration industry and is also used in agriculture segment. In fact, Existing customer of the company has requested for the installation of this machine and it is expected that post-installation, machine would run at full capacity with influx of orders.
  • Also, Company would be increasing the capacity of Unit-2 by 50% or 1250 MT in FY 17-18, thus increasing production without any Capital expenditure thereby attaining better RoI.

Growth Prospects

  • The company is expecting a minimum of 20-25% revenue growth and about 25% -30% increase in bottom line in FY 2018 as compared to previous yeAr
  • On consolidated basis, with trading activity at UAE, the estimated figure may change slightly upwards as the trading business is expected to grow.
  • The company has an order book of INR 147 cr. 
  • In USA, about 7-8 new clients have been added in Q1, FY 2018
  • The company has taken Trading in Q4, FY 2017 quarter on an experimental basis as there were number of customers wanting to purchase products but at lesser price and they were fine with small compromise in quality. The company started procuring the material from the Chinese manufacturers and selling them to customers in USA with a trading margin of 12-15%. But as the quality is not of the same standard, therefore, in order to prevent the brand equity dilution, the company is planning to set up a 100% subsidiary at UAE fully dedicated for trading activit
  • Economic growth, Government Initiatives to promote technical textiles sector, increased investment in industry, higher consumption and growing exports are going to fuel the growth in the medium to long term.

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Persistent Systems Q1FY18 Concall Summary

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 Overall Revenue Numbers :

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  • Dollar revenue for Q1 FY18 stood at $113.97mn showing a 3.6% q-o-q growth and 7.8% y-o-y growth
  • INR revenue for Q1 FY18 stood at INR 7,280.15mn showing a 0.1% q-o-q growth and 3.7% y-o-y growth
  • Linear revenue grew by 4.1% q-o-q, driven by 1.8% volume growth and a 2.2% increase in average blended billing rate
  • Offshore linear revenue dipped by 0.3% q-o-q, due to 0.8% dip in billing rate although there was 0.4% volume growth
  • Onsite linear revenue grew by 11.2% q-o-q, driven by 10.4% volume growth and a 0.8% increase in billing rate
  • Enterprise business revenue has grown by 9% q-o-q
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Margins

  • EBITDA margin for Q1 was 14.3% compared to 16.3% in Q4 FY17. Few factors that impacted EBITDA margin are:
    • Rupee appreciated by 3.4% which impacted the margin by 120bps
    • Higher proportion of onsite revenue coupled with investments and few new partnerships from previous quarters impacted the margin by 90bps
    • Lower offshore utilization impacted margin by 40bps
    • One-time seasonal cost in terms of visa and certain acquisition related costs relating to PARX impacted margin by 70bps
    • A few investments in sales people impacted the margin by 30bps
    • Provision for certain debts that crossed 180 days impacted margin by 40bps
  • Recovery of earlier provided debts has given a credit of 20bps during Q4 FY17, whereas in Q1 FY18, there was a charge of 20bps
  • Higher amount of IP Revenue helped margins to a certain extent
  • There was no wage pressure on EBITDA margin as some of the salary increments are shifted to next quarter
  • D&A in Q4 was at the same level compared to Q3 at 5.4% of revenue
  • EBIT margin for Q1 was 10.9% as against 9% in the previous quarter
  • Treasury income was INR 183mn in Q1 vs INR 171mn in Q4 FY17. The exchange gain in Q1 was at INR 184mn higher than previous quarter due to mark-to-market gain on hedges
  • PBT margin was 14% (INR 1,019mn) in Q1 compared to 12.9% in previous quarter
  • ETR for Q1 was 26.3%
  • PAT margin was 10.3% (INR 751mn) in Q3, growing by 3.2% q-o-q and 2.5% y-o-y
  • With more or less a constant billing model, future expansion of margins depends on growth from margin businesses like IP-led ones and the company seems to be on track 

Other Important Financial Information:

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  • Operational Capital Expenditure for Q1 was INR 85mn
  • Cash and investments at the end of Q1 were at INR 9,011mn compared to INR 9,411mn at the end of previous quarter
  • Value of forward contracts outstanding at the end of Q1 was $94mn at an average forward rate of INR 69.40/$

Services Business:

  • Q1 revenues were 5% up q-o-q. The company has closed few major deals in this quarter
  1. One in India - MP Vidhan Sabha. The company is using its IP and machine learning and sees potential to expand into other states as well
  2. One in US – An integration framework with 30+ banks and the company sees to have many of these banks ending up as customers in future
  3. Also, one of the life sciences deal that the company has last quarter started to scale up in Q1and may eventually expand to India as well from current US works
  • The number of customers in $3mn+ bracket has also been showing good growth, a positive sign for the business, however no of total customers reduced by 10

 Non-Services Businesses:

Digital Buisness  

  • Digital business remained flat compared to previous quarter with 36% y-o-y growth
  • The company has been building good solutions in the healthcare progressing well in the direction of transforming into solution-led business from project-led one
  • In Q1 the company had good progress with the deals that were acquired in previous quarter (USAA and Partners Healthcare)
  • The company is in multiple customer conversations for the offering that ithas built based on patented technology from USAA
  • For Partners Healthcare, the company is building an open source healthcare platform as well as the first clinical application for congestive heart failure. This IP would position Persistent very well for digital transformation in healthcare and also in financial services (as it is scalable)
  • During Q1, the company has added 15+ major customers, including
  1. A large U.S.-based home furnishing company
  2. A healthcare products’ company
  3. A large mobile carrier
  • However, there was a loss of 2 clients in IP led business

PARX Acquistion  

  • In Q1, the company has acquired PARX, a Salesforce certified platinum partner in Germany, Austria, and Switzerland, to expand European business, which is currently <6% of overall business
  • The deal value was CHF 8mn upfront payment and a provision for7.5mn CHF of additional earn-out over the next 3 years depending on performance and the founders staying within the company
  • PARX had ~CHF 8mn Revenues(generally works with small partners of average deal size $10-20k) in CY16 and ~80 employees
  • Persistent believes PARX to help in margin expansion in the next 2-3 quarters and also looks to leverage PARX’s solutions in other parts of the world as well

IBM Alliance business:

  • It has progressing well with good growth in terms of revenues and at the same time taking profitability building measures like cost-efficiency through realignment of employees, generation of potential leads, etc.
  • From the work perspective, for one of the new Pharma customers, the company is leveraging its artificial intelligence and machine learning expertise to develop a global regulatory science and policy intelligence application

Accelerite

  •  Accelerite business dipped a little in Q1 as one of the projects got closed out in the previous quarter, however, pipeline looks robust for future growth

Other Key Highlights:

  • Opened new centers in Mexico, Israel, and new locations in US
  • 2 new products –ShareInsights and Concertlaunched in Q1 have performed quite well
  • The growth trajectory for the full year looks very strong based on the momentum of new customers, new IP development, strengthening of consultative selling theme and strength in specific industries and platforms for the digital business

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Indusind Q4FY17 Concall Summary

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Financial highlights 

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  • Consistent interest margin of 4% for the past three quarters
  • During Planning Cycle 3, firm has doubled its number of branches, client base and the profits as well.
  • Earlier, the bank has showed its competence by achieving the bank’s doubling goal during PC 2 as well
  • Achieved a loan growth of 27% over the cycle
  • CASA ratiohas over-shoot the target of 36% and grew at 43% in Q4
  • SA grew at 57% in Q4
  • Fee growth has exceeded the loan growth
  • Global markets revenue crossed $0.5 billion
  • Operating profit growth of 37%, which is highest among all the quarters for the past 2-3 years
  • Net profit grew at 21% over the quarter and 25% for FY17 and the gap in the operating profit and net profit is due to issuance of unexpected provision of INR 122 crore on a standard loan, whose reversal is expected to happen in quarter 1 again
  • The Bank has achieved a revenue growth of 32%, fueled by the interest income growth of 31% and fee growth of 33%
  • Considering high growth of fee due to high contribution of trading part in quarter four, the bank achieved 29% fee growth excluding the trading part of fee
  • Achieved a credit growth of 28%
  • Net NPA remained at 39 bp and gross NPA fell slightly by 1 bp and hadshowed steady Net and gross NPA with stable provision coverage ratio
  • QoQ growth in FY17 was 6%, 19%, 11% and 15%
  • Improvement on the working capital financing side is due to the increased competitiveness of the bank on the pricing based on tenure due to MCLR regime
  • ROA was affected due to flat profit QoQ
  • The Bank is planning from current 70%-30% ratio of retail vehicle – Non-vehicle loans, to 50%-50% ratio over the next planning cycle
  • Net slippage for the quarter was INR 84 crore
  • Improved restructured advances may signify increase in the NPAs if the restructuring fails
  • In spite of high operational risks involved in Q4, CRAR remained flat at 15.31% and Tier-1 at 14.72%
  • Th distribution fee grew by 74%
  • Current ROE grew at 16%
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 Business updates

  • The Bank’s corporate business grew faster than the retail business due to increased competence on pricing
  • Opened 125 branches over the quarter 

Economic highlights:

  • Fiscal deficit target brought down from 3.4% to 3.2%
  • Impact of RBI policy on market policy lead to change in stand from accommodative to neutral
  • Setting up of Standard Deposit Facility will help in absorbing excess liquidity (Eg- reverse repo has high liquidity) from the market and banks will be given relief on interest payment
  • Rupee appreciated by almost 5.2% in the quarter
  • US fed rate went up
  • Growth forecast of India by IMF is revised from 3.6% to 3.4% 

Banking Industry Highlights:

  • RBI has now allowed banks to amortize for four quarters any losses on the sale to ARC
  • Q4 involves lot of operational risk for every bank in the industry
  • Although certain parts of India have lot of indebtedness due to microfinance loans but now around 95% of the borrowers are consistently being evaluated based on CIBIL scores, so that creditor will know that
  • Microfinance infrastructure in the industry is still developing, even after top 15 players in the industry, the quality goes significantly down in terms of processes and building capacities
  • Farm loan waiver being done in few states during state elections in UP, if spread to microfinance industry as well then it may have a significant impact on the industry’s revenue as a whole
  • Macros are expected to remain stable, which will lead to gentle interest rate regime due to stable inflation regime  

Bank’s highlights:

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  • During PC 2, the bank has doubled its number of branches from 300 to 600 and again during PC 3, bank was successful in doubling its branches from 600 to 1200
  • The bank has its largest sector as gems and jewellery but don’t possess any concentration risk as such
  • The bank showed significant traction of new-to-bank customers post demonetization
  • The bank wrote down heavily on two accounts it sold to an ARC and chose not to amortize it, thus impacting the cost of credit
  • Firm has seen slight improvement in the gross NPA in the retail
  • Over the past few months around March ’17, bank raisedAdditional Tier -1 capital of INR 2000 crore
  • The bank possess 3 million customers in Vehicle Finance,5.5 million customers in Retail Consumer bank and 1.2 million customers in the Microfinance 
  • Indusind is selling 3.6 consumer bank products per customer on an average
  • A lot of money from savings accounts also moving into alternate assets.
  • Branch size will be reduced to half from current 2500 sq. ft in metro to around 1200 sq. ft in the upcoming branches which leads to staff reduction from 23 to 12employees
  • The Company has acquired top position in terms of total number of deals on the debt side
  • Payment products, lending products and saving products, all three over time we are going to become viable.
  • The Company is not much affected by the BS-4 norms for vehicles because all the vehicles sold till march were based on BS-3 norms only
  • But BS-4 norms will impact the bank’s another business of used-vehicle financing in the near term
  • The bank’s loss given default in vehicle portfolio is just 30% over the past 10 years
  • IndAS is affecting the bottom line of the bank by around 4% along with some release from the provisioning norms
  • The bank currently has partnerships with 11 out of top 15 microfinance firms
  • Operating at a cost to income ratio of around 45%
  • The bank is trying to force its way to become more efficient on capital and therefore take lesser risk in the process by leveraging price competence and balancing corporate retail book
  • GST would make the logistics business more efficient resulting into more warehousing and high usage of LCV, with increased capacity of MHCV and HCV, thus gives a positive outlook of the vehicle sales and the bank’s business
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Planning Cycle 4

  • Intend to use “4D” strategy as Digitized to Differentiate, Diversify, and create Domain Leadership so as to double clients, loans and profits
  • Continue to focus on livelihoods loans because livelihood loans have lower delinquency
  • the rebalancing of the loan book:
    • Rebalancing of loan book to achieve 50-50 ratio between corporate and retail bank and 50-50 for vehicle and non-vehicle loans over a period of three years
    • Higher yield retail book tend to support margins and helps in improving the return on risk weighted assets (RORWA)
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  • Rural Banking and Microfinance: 350 out of 1200 branches of banks are in rural areas and the goal is to generate atleast 10% of total profits from these over the cycle
  • Improved focus on the bank’s overall Productivity through set of initiatives
  • Digitization of businesses, especially in the back office to improve the productivity in processes: Goal is to achieve 14% of bank’s profits by 2020 through initiatives in this space
  • Improving the client experience in the real world
  • Improving Internal collaboration and cross sell: Bank sells 3.6 consumer bank product per customer on an average, so now the goal is to get into selling non-banking products like vehicles so as to improve the profitability of the bank as a whole
  • Sustainability: It is not just about environment and social impact but also about governance and regulatory compliance to be fully sustainable
  • Increasing the number of branches to over 2000 and doubling the customer base to over 20 million
  • To become sustainable in rural banking, the main verticals to focus are agri-finance, vehicle finance, micro-finance and branch banking, so as to achieve 10% profit share from rural banking
  • Reducing the cost to income ratio by at least 2% through means of productivity improvement, reduction in customer acquisition costs, decreasing branch cost due to shrinking size and reduction in depreciation of branches and IT assets along with the increase in digitization
  • Would maintain the ROE at 20% from 16% and targeting a stable RORWA of 2.4%

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