Earnings Presentationa22112017.axisbank.com/docs/default-source/investor...4 Shareholding Pattern...
Transcript of Earnings Presentationa22112017.axisbank.com/docs/default-source/investor...4 Shareholding Pattern...
FY 2015-16
First Half Results
Earnings Presentation
1
Safe Harbor
Except for the historical information contained herein, statements in this release
which contain words or phrases such as “will”, “aim”, “will likely result”, “would”,
“believe”, “may”, “expect”, “will continue”, “anticipate”, “estimate”, “intend”, “plan”,
“contemplate”, “seek to”, “future”, “objective”, “goal”, “strategy”, “philosophy”,
“project”, “should”, “will pursue” and similar expressions or variations of such
expressions may constitute "forward-looking statements". These forward-looking
statements involve a number of risks, uncertainties and other factors that could
cause actual results to differ materially from those suggested by the forward-looking
statements. These risks and uncertainties include, but are not limited to our ability to
successfully implement our strategy, future levels of non-performing loans, our
growth and expansion, the adequacy of our allowance for credit losses, our
provisioning policies, technological changes, investment income, cash flow
projections, our exposure to market risks as well as other risks. Axis Bank Limited
undertakes no obligation to update forward-looking statements to reflect events or
circumstances after the date thereof.
2
Introduction
Performance Overview
Business Overview
3
Overview
Snapshot (As on September 30, 2015)
Total Assets `4,72,725 crores
Net Advances `2,98,066 crores
Total Deposits `3,24,101 crores
Net Profit (Q2FY16) `1,916 crores
Net Profit (H1FY16) `3,894 crores
Shareholders’ Funds `48,892 crores
Diluted EPS (annualised) `32.54
ROA (H1FY16) 1.71%
ROE (H1FY16) 17.37%
Net NPA Ratio 0.48%
Basel III Tier I CAR2 12.21%
Basel III Total CAR2 15.42%
Saving Bank Accounts (No.) 159 lac
Branches3 2,743
International Presence4 8
ATMs 12,352
Banking
Operations
Corporate
Credit
SME1
Retail
Banking
Transaction
Banking
Treasury
1 Small and Medium Enterprises
2 Includes profits for the half year3 Include extension counters4 Includes overseas subsidiary in UK
4
Shareholding Pattern (As on September 30, 2015)
Share Capital `475.59 crores
Shareholders’ Funds `48,892 crores
Book Value Per Share `205.61
Diluted EPS (annualised) `32.54
Market Capitalisation `1,23,909 crores (as on October 26, 2015)
&1 GDR = 5 shares
As on September 30, 2015, against GDR& issuance of 62.7 mn, outstanding GDRs stood at 18.4 mn
&
SUUTI11.56%
Life Insurance Corporation & its
group entities14.14%
General Insurance Corp & others
3.84%
Foreign Institutional investors42.13%
Indian Institutions9.16%
GDR3.87%
Others15.30%
5
High Shareholder Returns
A strong franchise demonstrating consistent value creation over time
141.50
162.69
188.47
205.61
BVSBook Value Per Share (`)
20.51
18.23 18.57
17.37
Return on Equity (%)Return on Equity (%)
FY13 FY14 FY15 H1FY16
1.701.78
1.83
1.71
Return on Assets (%)Return on Assets (%)
6
Introduction
Performance Overview
Business Overview
7
Performance Highlights
Q2FY16 H1FY16
Net Profit 19% YOY 19% YOY
Net Interest Income 15% YOY 19% YOY
Fee Income 14% YOY 13% YOY
Core Operating Revenue 15% YOY 17% YOY
Core Operating Profit 21% YOY 26% YOY
CASA1 13% YOY
CASA (Daily Average) 14% YOY
Total Deposits1 14% YOY
Total Advances1 23% YOY
1 As on 30th September 2015
8
Key Financial Highlights
Retail Franchise continues to show traction
• Daily Average CASA Deposits in Q2FY16 grew 14% YOY and constituted 40% of Total
Deposits
• Retail Term Deposits grew 18% YOY and constituted 64% of Term Deposits
• CASA and Retail Term Deposits constituted 80% of Total Deposits
• Retail Advances grew 27% YOY and accounts for 40% of Net Advances
• Retail Fee Income in Q2FY16 grew 19% YOY and constituted 40% of Total Fee Income
Stable Earnings Profile
• Core Operating Revenue in Q2FY16 grew 15% YOY and stood at `5,936 crores
• Core Operating Profit in Q2FY16 rose to `3,460 crores, registered growth of 21% YOY
• Return on Assets & Return on Equity for Q2FY16 stood at 1.64% and 16.62% respectively
Well positioned for future growth with Tier I CAR& of 12.21% & Total CAR& of 15.42%
under Basel III
Overall, a well capitalised Bank achieving consistently superior returns
& Includes profits for the half year
9
15% YOY
Growing Net Interest Income` crores
19% YOY
Trend in NIIs (` crores)
FY12 8,018
FY13 9,666
FY14 11,952
FY15 14,224
CAGR 21%
3,525
4,062
1Q2FY15 Q2FY16
6,835
8,118
1H1FY15 H1FY16
10
14% YOY
Diversified Fee Income Profile` crores
13% YOY
Q2FY16 H1FY16
Corporate Credit26%
Treasury & DCM10%
SME5%Transaction
Banking19%
Retail Business
40%
Corporate Credit25%
Treasury & DCM12%
SME5%Transaction
Banking19%
Retail Business
39%
1,591
1,813
1Q2FY15 Q2FY16
2,969
3,363
1H1FY15 H1FY16
11 19% YOY
Sustained Profitability Growth: Robust Operating Revenue
21% YOY 15% YOY 19% YOY 26% YOY 17% YOY
` crores
3,277
5,496
9,913
3,894
6,906
11,644
Net Profit Core OperatingProfit
Core OperatingRevenue
H1FY15 H1FY16
1,611
2,861
5,171
1,916
3,460
5,936
Net Profit Core OperatingProfit
Core OperatingRevenue
Q2FY15 Q2FY16
12
Consistent Net Profit Growth
Quarterly Net Profits` crores
CASA and Retail Term Deposits(` crores)
Stable CASA Growth Underpins Low-Cost Deposit Franchise
13
• Share of Retail Term Deposits to Total Term Deposits stood at 64%
• CASA + Retail Term Deposits constitutes 80% of Total Deposits
Growth (%)
As on September 30,
2015End Day
Daily
Average for
the half
year
Savings Bank 12 13
CASA 13 13
46,492 45,633 56,108 46,838 53,691
79,875 79,953 88,292
84,776 89,717
97,307 101,906 106,581
110,054 115,194
223,674 227,492
250,981 241,668
258,602
Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
CA Deposits SB Deposits Retail TDs
14
CASA Deposits(` crores)
CASA Ratio
Cost of Funds Net Interest Margin
Strong CASA Franchise Supports Margin Stability
3.97% 3.93% 3.81% 3.81% 3.85%
Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
6.19% 6.17% 6.26% 6.12% 5.99%
Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
46,492 45,633 56,108 46,838 53,691
79,875 79,953 88,292
84,776 89,717
126,367 125,586 144,400
131,614 143,408
Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
CA Deposits SB Deposits
45%43%
45%43%
44%
Sep-14 Dec-14 Mar-15 Jun-15 Sep-15
15
Stable Asset QualityAsset QualityLoan Mix
(As on September 30, 2015)
NPA trend
Provision coverage of 78% as on 30th September 2015
including prudential write-offs (87% before accumulated
write-offs)
Net Cumulative restructured advances were `8,426 crores
(2.65% of net customer assets) as on 30th September
2015
Capital Adequacy: Well Positioned for Growth
* Considering unaudited Net Profit for the quarter / half year / nine-months
16
12.57% 12.44% 12.07% 12.15% 12.21%
3.33% 3.20%3.02% 2.90% 3.21%
15.90% 15.64%15.09% 15.05%
15.42%
Sep-14* Dec-14* Mar-15 Jun '15* Sep '15*
Tier 1 CAR Tier 2 CAR Total CAR
17
Introduction
Performance Overview
Business Overview
18
Customer
Touch Points
Call
Centre
ATMs
Mobile BankingPoint of
Sale
Internet Banking
Branches
Traditional Channels Electronic Channels
Well distributed, countrywide network of Branches & ATMs
Expanding footprint across centres
One of the largest ATM networks in the industry
Mar’13 Mar’14 Mar’15 Sep’15
ATMs 11,245 12,922 12,355 12,352
Centres Covered 1,263 1,636 1,714 1,796
Employees 37,901 42,420 42,230 46,366
1 Including extension counters
Domestic Branch network1
1,947 2,402 2,589 2,743
Multiple channels drive business growth
Extensive use of technology to provide services
19
Retail Liabilities Exhibit Consistent GrowthSavings Bank Deposits
(` crores)
RTD as % of Term DepositsRetail Term Deposits (RTD)(` crores)
* Retail Deposits include Savings Bank and Retail Term Deposits
Retail Deposits* (% of Total Deposits)
12% YOY
18% YOY
79,875
89,717
1Sep '14 Sep '15
97,307
115,194
1Sep '14 Sep '15
62 63
1Sep '14 Sep '15
62 64
1Sep '14 Sep '15
20
Sustained Traction in Retail Assets
Maintained focus on secured
lending with greater emphasis on
mining existing liability customers
Integrated strategy for tapping into
consumer lending opportunity in
rural markets
Retail Advances constitute 40% of
Bank’s Net Advances in September
2015
Secured Loans make up 86% of
Retail Loans
Housing Loans account for 48% of
Retail Loans
Composition of Retail AdvancesKey Highlights
Portfolio Size: `1,19,448 crores
27% YOY
Housing Loans48%
Retail agricultural
loans15%
Auto Loans8%
Personal Loans & Credit Cards
10%
Loan against Property
8%
Non-schematic loans & others
11%
21
Growth in Retail Fees
Focus on cross-selling to existing
customers is the key driver for growth
Third-party products sold include mutual
funds, insurance, on-line broking, portfolio
management services (non-discretionary)
and gold coins
Healthy retail asset growth provides
momentum to asset linked fees
(` crores)Key Highlights
19% YOY
18% YOY
604
718
1Q2FY15 Q2FY16
1,121
1,326
1H1FY15 H1FY16
22
Retail Payments Franchise
Key Highlights
One of the largest issuers of debit cards
Over 19 lac credit cards in circulation
Credit card acquisition focused on large retail
depositor base
Multi Currency Forex Cards in 15 currencies –
USD, Euro, GBP, AUD, CAD, SGD, SEK, CHF,
JPY, AED, SAR, THB, NZD, HKD & ZAR; INR
(for foreign nationals and NRIs)
Prominent player in merchant acquiring
business
Number of Cards(in lacs)
Card Spends
(` crores)
33% YOY
130
15
141
20
Debit Card Credit Card
Sep '14 Sep '15
5,738
7,643
1Q2FY15 Q2FY16
Digital Banking
YOY growth
Note: Based on number of all financial transactions performed by
individual customers
Channel Mix – Q2FY16
Branch Analytics
Sales force tracker
Tablet Applications
Project Pratham
E Sales on Insurance
EmployeesCustomers
ProcessesBranches
Self Service Kiosks
Express Branches
Cash Deposit Machines
Cash Deposit Kiosks,
Recyclers
Axis Mobile 2.0
Ping Pay
Internet Banking
Social
Digital Ecosystem
Digital
47%
ATM
42%
Branch
11%
21%
-5% -6%
6%
Digital ATM Branch Total
Digital
ATM
Total
Branch
Mobile Banking Solutions
Our Mobile App is smarter with 60+ features Locker on Mobile Instant Personal Loan Conversion to EMI
2.3 Mnusers
414%growth in spends
`21,629 Cr overall spends
For 6 month period ended September 30, 2015 YOY growth as on September 30, 2015
Axis Mobile App
Lime… The first integrated mobile money platform
Seamless shopping experience
Simplified payments & transfers
SHOP
PAY
Completely digitised bankBANK
Multi-purpose walletWALLET
AND MUCH MORE…
Ping Pay – Multi-social payment app
25
Corporate Banking Franchise
End-to-End Player
Transaction
BankingCredit
Investment
BankingSyndication Treasury
Trustee
Services
• Strong franchise spread across liability and asset businesses
• Adopted value generating Originate and Distribute Model
• Dominant player in placement and syndication of debt / loans
• Focus on building out a high quality portfolio of credit assets
• Rigorous and regular risk assessment of accounts
Presence across the Value Chain
26
Transaction Banking
• Strong transaction banking capabilities
• Wide range of products with customised
offerings for various business segments
• Growth aided by “Club 50” and “Channel
One” high-end premium products
• Broad-based sales strategy
• Focused approach for Corporates, Financial
Institutions and Government
15% YOY
Current A/c Deposits (` crores)
FY12 39,754
FY13 48,322
FY14 48,686
FY15 56,108
CAGR 12%
` crores
Key Highlights Current Accounts
46,492
53,691
1Sep '14 Sep '15
27
Transaction Banking
17% YOY
• Collection of Central Govt. taxes on behalf of
CBDT and CBEC, including through e-payments
• Collection of state taxes & collections under E-
governance on behalf of 16 & 5 State Govt. and
Union Territories respectively
• Collections and payments for Central Govt
ministries - Railways, MOF, Urban Development
and Housing & Urban Poverty Alleviation
• NPS Trustee Bank & Collection Bankers for
subscriptions through all Branches
• Appointed as Centralised Clearing House for
Electronic Toll collection based on RFID tags by
a subsidiary of NHAI
• Leverage 50 authorised branches as Hubs and
source PPF accounts from all branches
CMS Accounts
Government Business Cash Management Business
• Leading CMS provider in the country
• Among few banks offering host to host
transaction banking facility
22,749
26,689
1Sep '14 Sep '15
28
Corporate Banking
Advances Fees
25% YOY
(` crores) (` crores)
111,186
138,549
1Sep '14 Sep '15
470 470
1Q2FY15 Q2FY16
806 840
1H1FY15 H1FY16
4% YOY
29
Debt Capital MarketsKey Highlights Placement & Syndication of Debt Issues
Dominant player in placement and
syndication of debt issuances
Ranked No. 1 debt arranger by Prime
Database for quarter ended June 2015
Ranked No. 1 underwriter for ` Denominated
Bonds by Bloomberg for nine months ended
September 2015.
Awarded ‘Best DCM House’ 2015 by Finance
Asia
Awarded ‘Best Debt House in India’ by
Euromoney & Asiamoney for 2015
(` crores)
3% YOY
67,225 64,967
1H1FY15 H1FY16
Overall industry volumes shrunk 7% for half-year ended
September 2015 - Source: Bloomberg
30
SME Banking
Advances
8% YOY
Fees
11% YOY&
(` crores) (` crores)
&SME loans (including non-retail agriculture loans) grew 9% YOY
35,771
39,702
1Sep '14 Sep '15
86 94
1Q2FY15 Q2FY16
136 152
1H1FY15 H1FY16
12% YOY
31
Rating Distribution: Corporate Banking
61% of corporate advances have rating of at least ‘A’ in September 2015
32
Rating Distribution: SME
85% of SME advances have rating of at least ‘SME3’ in September 2015
33
Industry-wise Distribution (Top 10)
Rank Sectors
Outstanding as on September 30, 2015 (%)1
Fund-basedNon-fund
basedTotal
1. Infrastructure2 7.20 10.23 7.95
2. Engineering & Electronics 3.25 16.96 6.67
3. Metal & Metal Products 6.18 6.10 6.16
4. Financial Companies3 4.80 10.51 6.22
5. Power Generation & Distribution 5.90 6.24 5.98
6. Trade 3.09 5.70 3.74
7. Real Estate 3.12 2.06 2.85
8. Food Processing 2.83 2.33 2.70
9. Petroleum & Petroleum Products 0.49 7.60 2.27
10. Telecommunication Services 1.03 4.78 1.96
1 Percentages stated above are on the total fund and non-fund based outstanding across all loan segments2 Financing of projects (roads, ports, airports etc)3 Includes Housing Finance Companies and other NBFCs
34
International Presence
Branches at Singapore, Hong Kong, DIFC – Dubai, Colombo & Shanghai
Representative offices at Dubai & Abu Dhabi
Axis Bank UK Limited (a wholly-owned subsidiary of the Bank)
Business offerings include Corporate Loans, Trade Finance Products, Debt Syndication and Liability Business
Total Assets overseas stood at USD 7.51 billion
35
Some Awards & Recognition
Ranked amongst the Top 75 safest banks in the world by The Banker
Axis Bank brand awarded title of Superbrand 2014-2015
Best Smartphone Mobile Banking App in India by Forrester Research
Mobile Banking Initiative of the Year - India, Asian Banking and Finance (ABF) Retail Banking Awards 2015
Best Corporate Payment Project- The Asian Banker Technology Implementation Award 2015
36
Thank You