Professional Documents
Culture Documents
UNDERSERVED
CUSTOMERS
CUSTOMISED
FINANCING
SOLUTIONS PAN INDIA
NETWORK
Bringing Equality of Opportunity
2
2
to the Economically Disenfranchised
2
Business Overview, Competitive Strengths and Strategy
Leadership Team
Annexures
SEGMENT 2 :
SELF EMPLOYED Self employed customer with informal income
NON PROFESSIONAL sources (Home/Car buyer)
UNDERSERVED
(SENP)
RURBAN
CUSTOMERS SEGMENT 3 : Small factory owner/contractor, trader/shop owner
SMALL & MEDIUM with working capital needs ( SME/LAP customer)
ENTREPRENEURS Small fleet operator (taxi/truck/equipment buyer)
Rurban includes Rural and Semi-Urban locations/customers Images used for representation purposes only
Commercial Finance
Magmas Core Strengths
Commercial Finance includes New and Used Vehicles/Equipment; SME Finance includes Unsecured Loans to
Business Enterprises; Mortgage Finance includes LAP and Home Loans; Agri Finance includes Tractors
Commercial
Finance 4-5 70-75% 40-45
FINANCING SOLUTIONS
General
Insurance
Extensive Pan India Branch Network Across Rural and Semi-Urban India
Hub and spoke model with wide coverage led to presence in point of
284 branches
sales enabling sourcing from 1,900 talukas and 2,900 locations
8,997 employees
Tablet usage has led to superior sales productivity, better market
coverage, improved channel and customer experience
Focus on asset-light model: Field executives come to branch office once a
week; technology solutions enable them to conduct business from
channel/customer location
Strong customer engagement through 6500+ field executives
State of the art toll free Inbound/Outbound Customer Delivery Centre for
servicing and cross sell
North,
35% Rural, Semi-urban,
West, 32% 49%
25% East,
19% Urban,
South,
21% 19%
PEOPLE PROCESS
Merger of Sales and 0-90 Collections Simplified credit screens
team to provide one-point contact with Implemented immediate risk hind-
OBJECTIVES
customer. Increasing customer touch sighting
points from 1500 to 3300 field officers
Better customer service L2D process simplified and enabled in
Reduced FOS service radius from 75 tablets
Better and faster credit decision
kms to 30 kms
Improved productivity and cost
Delegating decision making to Branch
efficiency.
managers
Better channel management
Incentives aligned to drive direct CUSTOMER
Better local accountability and business / cross sell / customer service FOS tagged to 8000 channels for
ownership
service and business
TECHNOLOGY
More Direct Business and higher
Rigor of daily market activity
yields High level of technology adoption by
implemented
field officers and supervisors, improving
efficiency and productivity IRR grids, doc charges, payout
structures & escalation matrices
Daily Journey Plan and Visit Calendar
revised
enabled in tablets
Tablet equipped field executives capable Channel portal allows automatic tracking Online submission of Field Investigation
of operating from any location (virtual of files/process reports
office) Call centre to provide real time support Cash collection at customer location, on
Electronic transfer of loan application for complaints/enquiries spot money receipts, instant reporting of
with all documents from point of sale. Frontline Decision Support for better collections to central database.
Usage of Data Analytics for customized understanding of customer requirements External credit databases embedded in
Cross sell and Up sell offering. BI/sales interfaces
Outcome Increased Penetration, Faster Outcome Improved Customer experience, Better Outcome Enhanced Customer service, Faster
Turnaround time & Better lead conversion. product design Inputs Credit Appraisal, Robust Cash management
Agent Portal (MHDI)
OEM, End-Use and Resale demand Customised screens to consider Past portfolio based terminal losses as
driven product classification informal income streams with relevant key indicator for developing Early
experience Warning Indicators (EWI)
Informal segment with relevant
experience Branch, product and dealer grading Credit hind sighting of early delinquent
Differentitated offering in various Asset gradation as per customer cases to resolve them and use them as
markets considering Net Adjusted profile feedback mechanism in credit screens
Return Online Process Automation at sourcing Branch level tracking involving local
/ under-writing stages for fraud business teams
mitigation
Comprehensive Risk Management
Framework
SUPPORTED BY STRONG ANALYTICS
Focus on product profitability and branch Employ judicious mix of NCD / CP / bank lines
profitability / securitisation to reduce COF and limit
Increase share of higher risk-adjusted yield concentration / liquidity risk
and high RoA products (Agri /Used Assets Diversify mix of debt market investors
/SME /Mortgage Finance) Increase share of priority sector lending (PSL)
OPEX
OPEX REDUCTION
REDUCTION ASSET
ASSET QUALITY
QUALITY IMPROVEMENT
IMPROVEMENT
LEVERS
Enhance
Enhance productivity
productivity through
through technology
technology Calibrate
Calibrate portfolio
portfolio according
according to
to product
product--
enablers,
enablers, automation
automation and
and process
process customer-geography
customer-geography mixmix
simplification
simplification Refine
Refine credit
credit screen
screen and
and processes
processes to
to optimize
optimize
Reduce customer
Credit scoring acquisition cost by
model portfolio
portfolio performance
performance
Increasing
Reduce direct
customer sourcingcost by
acquisition Employ
Employ product
product wise
wise early
early warning
warning indicators
indicators
Improving cross-sell and
and loss
loss tracking mechanisms
tracking mechanisms
Increasing direct sourcing
Providing Grading of branches, products, dealers and
Improvingsuperior
cross-sellcustomer service
FOS according to the portfolio quality
Providing superior customer service
CSR Leadership Award at Awarded 2nd Best Project of BFSI Tech Maestro Awards
National Awards for the Year for Highway Heroes 2016. Award for the most
Excellence in CSR & at NHRDN CSR effective Data centric
Sustainability. Competition, 2016. Security Implementation
Frost & Sullivan presented Magma's FY16 Annual Report was Platinum Award of Excellence
the 2016 Customer Service recognized at the 2016 VISION from LACP Spotlight Awards
Leadership Award in Awards competition of LACP 2016 for our Mission India
(League of American
Vehicle Fleet Leasing to Communications Professionals).
communications campaign.
Magma Fincorp Auto Lease The competition was tough with The campaign was recognized
in recognition of the nearly 1200 entries from two dozen as the most creative and was
companys exemplary countries competing for the ranked 7th in the top 25
customer service. coveted recognition. Top 50 entries communications in 2015
have been adjudged "World Class" worldwide.
and Magma Fincorp report is given
a ranking of 31 in Top 50.
Leadership Team
Annexures
Q4 FY16 Q4 FY17
Loan Assets Sale of NPAs and lower than expected disbursements in 2HFY17 Loan Assets
Rs 18,183 cr due to demonetization Rs 16,101 cr
NIM Lower cost of funds and increase in contribution of high yielding NIM
7.50 % products 7.58 %
Opex/Loan Opex/Loan
Assets Increase in opex ratio is largely due to lower AUM Assets
3.14 % 3.57 %
GNPA GNPA
Sale of hard bucket NPAs and strong collections in Q4 FY17
8.05% 6.71%
PAT PAT
Loss incurred on sale of NPAs led to loss in Q4FY17
Rs 66 cr Rs (122) cr
RoA RoA
Negative ROA due to loss on NPA sale
1.69 % -3.45 %
FY16 FY17
Loan Assets Sale of NPAs and lower than expected disbursement in 2H due to Loan Assets
Rs 18,183 cr demonetization Rs 16,101 cr
NIM Lower cost of funds and increase in contribution of high yielding NIM
6.97 % products 7.43 %
Opex/Loan Opex/Loan
Assets Opex on absolute basis declined y-o-y but lower AUM led to Assets
3.36 % increase in opex ratio 3.62 %
GNPA Sale of hard bucket NPAs and improvement in full year collection GNPA
8.05 % efficiency 6.71 %
PAT PAT
Loss in Q4FY17 due to NPA sale led to lower full year PAT
Rs 213.5 cr Rs 12.7 cr
RoA RoA
ROA compressed in line with PAT de-growth
1.4 % 0.1 %
100%
10.8% 9.0% 9.7%
17.1% 19.9%
16.0%
10.1% 18.0% 22.3%
75%
49% 16.0%
63% 61%
16.9% 21.0%
18.4% 12.1%
17.0%
50% 14.0%
16.0% 17.1%
15.8%
8.2% 14.1%
5.4% 6.0% 5.8%
9.2% 5.3% 4.7% 4.0% 7.4%
25% 4.2%
51% 39%
37%
24.5% 26.9% 29.0% 25.6%
23.5%
0%
FY15 FY16 FY17 Q3 FY17 Q4 FY17
UV/Cars CV CE Used Assets Agri Finance SME Finance Mortgage Finance
Commercial Finance
Values in Rs crore
100%
14.6% 18.5% 18.8%
7.1%
75% 9.5% 11.7%
42%
17.8% 62%
18.8%
19.7%
11.9%
50%
11.2%
9.8% 11.4%
8.0%
6.6%
13.3%
9.1% 6.5%
25% 58%
38%
25.5% 24.9% 25.3%
0%
FY15 FY16 FY17
UV/Cars CV CE Used Assets Agri Finance SME Finance Mortgage Finance
Commercial Finance
7.4%
7.4% 7.4%
15,000 4,084
Loan Assets (Rs crore)
NIM
10,000
6.2%
6.2%
5.5% 5.8%
5,000
5.4%
11,352 13,274 14,099 11,968 13,122 11,968
- 5.0%
FY14 FY15 FY16 FY17 Q3 FY17 Q4 FY17
On Book Assets Off Book Assets NIM - Year (yoy) NIM - Qtr (yoy)
NIM expansion driven by gradual shift towards higher yielding products and lower cost of funds
North: 38%
Haryana, 7%
Uttarakhand/Delhi, 5% Punjab/Himachal, 4%
Rajasthan, 8%
Maharashtra, 9%
Uttar Pradesh, 14%
Madhya Pradesh, 6%
Bihar, 5%
West: 23% Gujarat, 5% East: 16%
Jharkhand, 2%
Chattisgarh, 3%
Tamil Nadu, 4% Orissa, 4%
South: 23%
100%
14% 12% 12% 11% 12%
75% 28% 31% 22% 28% 23%
50%
0%
FY15 FY16 FY17 Q4 FY16 Q4 FY17
Tier I/II Capital & Others Debt Capital Markets Banks
B/S Debt includes Preference Capital and based on MFL Consolidated financials; Values in Rs crore. Above chart is based on average utilization
Diversified liability sources limit concentration risk, allows stable flow of funds and stable
Instrument CARE Rating rating, all leading to lower costs
Short term Debt A1+ Rated by CARE, ICRA , CRISIL, India Ratings, SMERA & Brickwork
Other unsecured debt includes Perpetual debt, Sub debt and Preference capital
GNPA % NNPA %
9.9%
8.1%
7.5%
6.4% 6.7%
5.6%
120 dpd
Income from Ops. 559.9 580.6 633.0 -12% -4% 2,344.5 2,472.2
Net Operating Income 303.0 308.5 335.0 -10% -2% 1,219.0 1,280.6
Net Total Income 317.0 322.0 344.2 -8% -2% 1,274.0 1,314.7
TOTAL LOAN ASSETS 16,101 17,345 18,183 -11% -7% 16,101 18,183
Values in Rs crore
CRAR
CRAR based on MFL (Standalone) financials. Assets implies average of opening and closing balance of On B/S Assets of MFL (Consolidated)
Leadership Team
Annexures
Integrity and
Credibility
Trust and
Openness and
Respect for
Transparency
People
Magmas
Core Values
Chairman Emeritus of
Anchors strategic policy Sanjay Nayar
CEO and Country Head of Exide Industries. Serves on
Sanjay formulation and execution. Non Executive
KKR, India. Ex CEO of Citi Satya Brata the Boards of various
Chamria Drives new business Director
India & South Asia Ganguly reputed Indian corporate
VC and MD initiatives and leads (Nominee of operations and public bodies as an
management team KKR) Independent Director
Name, Current
responsibility, Experience
Senior management with extensive experience both within Magma and in the industry in years, Previous
organisation
Net Worth: Rs 2,038 cr Net Worth: Rs 132 cr Net Worth: Rs 226 cr Net Worth: Rs 275 cr
PAT: Rs 6.1 cr PAT: Rs (29.7) cr PAT: Rs 6.3 cr PAT: Rs 33.8 cr
Shareholding of Magma Fincorp (31 March 2017) Top Non Promoter Shareholders
Promotor,
27.75% Overseas
KKR
Bodies31.99%
TRUE NORTH
Public 16.42%
INTERNATIONAL FINANCE CORPORATION
CHYRS CAPITAL
Domestic LEAPFROG INVESTMENTS
FII , 16.58%
Investors 7.26%
Leadership Team
Annexures
Share Capital 47 47 47 0% 0% 47 47
Preference Capital - - 13 NA NA - 13
Cash & Bank Balance 359 422 368 -2% -15% 359 368
TOTAL LOAN ASSETS 13,514 14,509 15,300 -12% -7% 13,514 15,300
All values in Rs crore
Pre Prov Profit 15.0 16.9 15.1 13% -3% 59.7 46.7
Profit Before Tax 15.7 13.7 10.2 53% 14% 52.0 35.3
Profit After Tax 10.2 8.8 6.6 56% 16% 33.7 22.8
% Change
Q4 FY17 Q3 FY17 Q4 FY16 FY17 FY16
Y-o-Y Q-o-Q
Gross Written Premium 132.2 102.2 116.5 14% 29% 422.9 427.4
Net Earned Premium 79.2 86.1 82.5 -4% -8% 327.1 373.2
(-) Management Expenses 42.6 33.9 28.4 50% 26% 143.4 126.1
(+) Investment Income 25.5 19.6 20.4 25% 30% 84.7 78.2
Profit Before Tax 1.5 2.8 7.2 -78% -45% 7.2 -6.6
Profit After Tax 1.7 2.3 1.9 -9% -26% 6.3 -11.9
All values in Rs crore
Net Operating Income 19.9 16.5 16.6 20% 20% 70.8 67.2
Net Total Income 20.0 18.2 18.1 11% 10% 76.8 72.5
Pre Prov Profit 15.4 6.2 9.6 56% 72% 38.0 33.1