JM Financial Limited · NSE:JMFINANCIL
JM Financial — JM Financial Asset Reconstruction Company — Investor Presentation (May 2018)
28 slides from JM Financial's investor presentation, May 2018
Slide 1: JM Financial Asset Reconstruction Company Limited (JMFARC) Corporate Presentation
JM Financial Asset Reconstruction Company Limited (JMFARC) Corporate Presentation May 2018
Slide 2: Safe Harbour
Safe Harbour This presentation and the following discussion may contain “forward looking statements” by JM Financial Asset Reconstruction Company Limited (“JMFARC”) that are not historical in nature. These forward looking statements, which may include statements relating to future results of operati
Slide 3: Business Highlights
Business Highlights • JMFARC is the 3rd largest capitalised ARC with net worth of Rs. 967 Crore (as on March 31, 2018) Strong Balance Sheet • JM Financial Ltd is the holding company with 57.07% holding, balance equity held by Banks, HNIs & FII and Strong Sponsors • 77.07% stake is held by Sponsors (
Slide 4: Industry Overview
Industry Overview Aw FINANCIAL
Slide 5: Stress in the Indian Banking Sector
Stress in the Indian Banking Sector • Big opportunity for ARCs Stressed assets • The macro stress tests suggest that under the given the high level of (%) baseline scenario, the GNPA ratio may rise to 11.1 NPAs, expected slippage in per cent by September 2018 (RBI’s Financial 15% Stability Report) r
Slide 6: Current Legal Framework - RBI Guidelines
Current Legal Framework - RBI Guidelines Classify Account as All SMA accounts with exposure of Default prior to March 01,2018 Default after March 01,2018 SMA 0 – 1- 30 days, Rs.5 crore and more should be 180 days from the date as 180 days from the date SMA1 -- 31- 60 days, reported weekly to CRILC a
Slide 7: Current Legal Framework – IBC 2016
Current Legal Framework – IBC 2016 Insolvency and Bankruptcy Code – 2016 (Code) Bankruptcy & • National Company Law Tribunal governs Corporate Entities Insolvency Adjudicator • Debt Recovery Tribunal governs Individuals and Partnership Firms Insolvency • Insolvency and Bankruptcy Board of India will
Slide 8: JMFARC Overview
JMFARC Overview Aw FINANCIAL
Slide 9: Summary of Assets Acquired & Outstanding
Summary of Assets Acquired & Outstanding as on March 31, 2018 Assets Acquired - Gross Security Receipts Outstanding • Acquired financial assets of Rs. 32,349 Crore (Total dues) • SRs subscribed by JMFARC and Others - Rs. 12,965 Crore • Cost of Acquisition Rs. 14,761 Crore • SRs subscribed by JMFARC
Slide 10: Resolution and Recoveries
Resolution and Recoveries Cumulative recovery till March 31, 2018 Rs.3,510 Crore • Capital / Business restructuring as required with existing management • Additional financing Sale of Resolution Assets under • Sale of Core / Non-Core Asset SARFAESI Strategy • Change of Management 16% • Assets resolv
Slide 11: Recovery Over the Years
Recovery Over the Years INR Crore Total Recovery & Security Receipts Redeemed Total Recovery till March, 2018 : 1200 Rs.3,510 Crore Total SRs Redeemed till March, 2018 : Rs.1,766 Crore 974 1000 910 JMFARCs SRs redeemed till March, 2018 : Rs.1,132 Crore 800 608 609 587* 600 516 502 400 362 321 276 22
Slide 12: Accounting for JMFARC
Accounting for JMFARC • Accounting within the framework of Accounting Standards issued by ICAI Accounting • Specific accounting guidelines for ARCs by RBI Framework • Conservative accounting philosophy • Main items of revenue - Management Fees, Interest and Upside/ Profit • The recognition of revenu
Slide 13: JMFARC Financial Performance
JMFARC Financial Performance Last 5 years trend Total Income AUM (Rs.Crore) (Rs.Crore) 14,000 12,965 387 11,874 400 12,000 319 9,821 300 10,000 8,398 214 224 8,000 200 6,000 120 3,646 4,000 100 2,000 0 0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Profit Before Tax Profit After Tax (Rs. Crore)
Slide 14: JMFARC Financial Performance
JMFARC Financial Performance Last 5 years Trend Networth Total Borrowings (Rs.Crore) (Rs.Crore) 1200 1600 967 1,351 1000 1400 1,130 1,163 1200 800 1000 580 765 600 525 800 417 400 330 600 346 400 200 200 0 0 2014 2015 2016 2017 2018 2014 2015 2016 2017 2018 Debt Equity ROE & ROA (x) (%) 3.00 2.71 25
Slide 15: Networth, Liability Profile and Credit Rating
Networth, Liability Profile and Credit Rating Networth Composition Credit Rating As on March 31, 2018 Sharehol ders' Funds ICRA & CARE Bank Loan of Rs. 650 Crore 56% AA- (Stable) • March’ 18 Net worth Rs. 967 Crore as against ICRA & CARE Non Convertible Debentures of Rs. 1000 Crore Rs 214 Crore in A
Slide 16: Select Case Studies - Acquisitions
Annexure 1 Select Case Studies - Acquisitions 15
Slide 17: Select Case Studies
Select Case Studies Project Hospitality Project Pharma • Engaged in the manufacturing and sale of Intermediates and Active Pharmaceutical Ingredient (APIs). Also engaged in contract manufacturing • Leading player in the luxury hotels segment in India • Has 8 manufacturing facilities including 2 USFD
Slide 18: Select Case Studies (cont’d)
Select Case Studies (cont’d) Project Ceramics Project Cements • The company is engaged in the manufacture and marketing of tiles • Engaged in cement manufacturing business since 1987 (ceramic and vitrified) and processing and refining of marbles Business / • Owns and operates approx. 1.0 mn TPA ceme
Slide 19: Select Case Studies (cont’d)
Select Case Studies (cont’d) Project Drugs Project Pan India • Engaged in the manufacturing and sale of • Leading Real Estate Developer having operations across India Intermediates and Active Pharmaceutical Ingredient • Group has delivered about 23.39 million sqft while it had about 34.78 million sq
Slide 20: Select Case Studies - Resolution
Annexure 2 Select Case Studies - Resolution 19
Slide 21: Select Case Studies
Select Case Studies Project Resin Project Retail Company • Engaged in manufacturing and trading of resins • Acquisition of 3.76 lakh Personal Loan & Credit Cards accounts spread across 24 Background • Non-operational unit locations • Price expectation mismatch between bank and JMFARC for • Establish
Slide 22: Select Case Studies (cont’d)
Select Case Studies (cont’d) Project Poultry Project Paint • Integrated poultry breeder located in Western India • Promoter having more than 45 years of experience in the • Engaged in manufacturing of paints Company business • Plants located at Rajasthan, Maharashtra & Tamil Nadu and windmills at Sa
Slide 23: Select Case Studies (cont’d)
Select Case Studies (cont’d) Project Metal Project Real Estate • Operating in a niche industry - Engaged in production of minor • Real Estate Developer having operations in Bangalore and Hyderabad . Group metal oxides which are used for making carbide grade tool has delivered 5 mn sqft, has 5 mn sqf
Slide 24: Select Case Studies (cont’d)
Select Case Studies (cont’d) Project Township • Engaged in the development of Real Estate Projects. Company Background • Operating Company with good asset base • Aggregation of Debt from several lenders Challenges & • Low fidelity of cash flow projection due to uncertainty involved with real estate
Slide 25: List of Board of Directors
Annexure 3 List of Board of Directors 24
Slide 26: Board of Directors & Shareholders
Board of Directors & Shareholders Board of Directors Public sector Mr. V. P. Shetty Chairman Banks* 14.51% Valiant Mr. Narotam Sekhsaria Sponsor Director Mauritius Partners FDI Limited 8.42% Mr. Pulkit Sekhsaria Sponsor Director JM Financial Limited* Radhakrishna 57.07% Bimalkumar Mr. H. N. Sinor In
Slide 27: Profile of Board of Directors
Profile of Board of Directors • Banking experience of 40 years. • Commerce Graduate and holds a CAIIB degree • CMD of UCO Bank, Canara Bank and IDBI Bank. Mr. V. P. Shetty • Chaired the CDR Core Group meetings. • Recipient of "Banker of the Year – 2003“. • Currently also Chairman of JM Financial Pro
Slide 28: Profile of Board of Directors (cont’d)
Profile of Board of Directors (cont’d) • Holds bachelor’s degree in Chemical Engineering. • Former Chairman and Managing Director of Bank of Baroda and Dena Bank. • Former President- Indian Institute Banking & Finance. Dr. Anil K Khandelwal • Deputy Chairman- Indian Banks Association. • Member of va
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