Axis Bank Limited · NSE:AXISBANK
Axis Bank — Investor Presentation (May 2012)
28 slides from Axis Bank's investor presentation, May 2012
Slide 1: Aiming at Balanced Growth
Aiming at Balanced Growth May 2012
Slide 2: Contents
Contents Key Macro Trends Business Model & Strategy Financial Snapshot 1
Slide 3: India Opportunity
India Opportunity High Savings rate Favourable demographics India’s Savings Rate as a % of GDP 40% 36% 37% Population below 30 years as a % of total population 35% 33% 34% 35% 31% 32% 32% S Africa 60% 30% 30% 27% 26% India 59% 25% Malaysia 57% Mexico 55% 20% Indonesia 54% 15% Brazil 53% 10% China 45
Slide 4: Key Opportunities for Banking Sector
Key Opportunities for Banking Sector Rapid urbanisation Private Investment in Infrastructure 590 6000 100% (Twelfth Plan) 340 80% 5000 Public Private 290 220 60% 4000 (` in bn) 40% 3000 750 815 880 636 20% 2000 0% 1991 2001 2008 2030 1000 Rural population (mn) Urban population (mn) 0 Urban GDP share
Slide 5: Contents
Contents Key Macro Trends Business Model & Strategy Financial Snapshot 4
Slide 6: Axis Bank Overview
Axis Bank Overview Advances growth (%) 70% India’s 3rd Largest Private Sector Bank 62% Axis Bank Peer banks* 60% ► Assets of over ` 2,856 bn, Net Worth of ` 218 bn 50% ► Assets and Net Profits 5 year CAGR of ~31% and ~45% 40% 37% 36% ► CAR of 13.66% with Tier I at 9.45% as on 31st Mar, 2012 30% 23
Slide 7: Consistent Growth Across Business Indicators
Consistent Growth Across Business Indicators Advances (` bn) 2,500 Deposits (` bn) 2,201 1,800 1,698 2,000 1,892 1,600 1,424 1,400 1,500 1,413 1,200 1,043 1,174 1,000 816 1,000 876 800 597 600 588 369 500 400 200 0 0 FY07 FY08 FY09 FY10 FY11 FY12 FY07 FY08 FY09 FY10 FY11 FY12 Net Profits (` bn) Grow
Slide 8: Superior Track Record of Growth and Profitability
Superior Track Record of Growth and Profitability Asset growth (%) PAT growth (%) Axis Bank Peer Banks Axis Bank Peer banks* 69% 50% 63% 35% 34% 39% 26% 36% 35% 33% 21% 22% 26% 18% 25% 16% 12% 11% 18% 9% FY08 FY09 FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12 RoA (%) RoE (%) Axis Bank Peer Banks Axis Bank
Slide 9: Evolution of Axis Bank's Business Model
Evolution of Axis Bank’s Business Model Phase 3: FY 10 onward • Predictable, consistent profitable growth • Reduced risk concentration • Increase share of customer wallet • Improve operating leverage • Above industry growth Phase 2: FY 04 – 09 • Developed CASA franchise • Fee income – diversity in r
Slide 10: Business Strategy Along Four Key Themes
Business Strategy Along Four Key Themes Leveraging Domestic Growth Opportunities Leverage strengths in Continue to build and Corporate Banking & strengthen Retail Banking Infrastructure linked Financial franchise services Capture end-to-end Build a full-service offering to opportunities in Payments
Slide 11: Strong product offering complemented by a Pan-India distribution channel
Strong product offering complemented by a Pan-India distribution channel… Branches & Extension counters Multi-channel Pan-India Presence with a Full Suite of Products Retail Total Customer Metro Urban Semi-urban Rural Branches Mar'08 34% 41% 21% 4% 644 Channels Products Mar'09 31% 40% 23% 6% 792 Mar
Slide 12: ...culminating in a strong retail franchise
…culminating in a strong retail franchise CASA and Retail term deposits (` bn) Retail Advances Portfolio (` bn) Retail Term Deposits 1,393 400 376 Savings accounts deposits Current accounts deposits 1,113 350 929 479 300 278 745 335 250 208 561 268 200 161 239 517 136 409 150 337 160 339 89 258 100
Slide 13: Stable retail funding mix & thrust on secured retail assets
Stable retail funding mix & thrust on secured retail assets CASA/Branch higher than peers (` crores) Composition of deposits 56 CASA as % of CA as % of CASA CASA + Retail 47 As on Total Deposits Deposits Term Deposits* 33 FY07 40% 48% 57% 24 FY08 46% 50% 64% FY09 43% 49% 63% FY10 47% 49% 66% FY11 41
Slide 14: Recognition for High Quality Customer Service
Recognition for High Quality Customer Service Hindustan Times – MARS Banking Satisfaction study 2010 This independent survey covered 18 Cities and 9,486 bank account holders across India 13
Slide 15: Corporate Bank: Originate and Distribute Model
Corporate Bank : Originate and Distribute Model Corporate Banking: A key driver End to End Infrastructure Player of overall bank performance Investment Non-Bank Business Credit Syndication Treasury Banking Units Banking Agri & Others Debt Private Placement League Table Loan syndication market share
Slide 16: Strong Treasury enhancing Syndication capabilities
Strong Treasury enhancing Syndication capabilities Placement & Syndications (` bn) Treasury & Cap Markets Fees (` bn) (Debentures / Bonds) 1,200 1,130 12 10 1,000 10 830 8 800 8 691 689 7 6 573 600 6 4 4 400 2 200 0 0 FY08 FY09 FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12 Forex Turnover (` bn) Placement
Slide 17: Full-service Offering to SME Customers
Full-service Offering to SME Customers Lending Other Offerings • Diversified portfolio across 3 segments: Medium • Commercial banking products Enterprises Group, Small Enterprises Group and - Current accounts, forex, trade services Supply Chain Finance • Retail banking solutions • Driven through 32
Slide 18: Credit Profile
Credit Profile Rating distribution of Large and Mid-corporate Loans1 (%) Secured loans as a % of Total Aggregate Loans AAA AA A BBB <BBB or unrated 1 5 10 7 8 22 22 86.6% 84.5% 86.4% 18 25 19 83.8% 81.7% 58 47 40 54 43 22 23 30 15 16 3 3 4 2 3 Mar'08 Mar'09 Mar'10 Mar'11 Mar'12 Rating distribution o
Slide 19: Payments Solutions Across Government, Corporate and Business Segments
Payments Solutions Across Government, Corporate and Business Segments • Leading player in Electronic Benefit Transfer (EBT) through Smart Cards under IT Enabled FI Model • Leading Bank in G2B e-Governance initiatives Continue to capture end to end payment • Amongst select set of Indian banks offerin
Slide 20: Contents
Contents Key Macro Trends Business Model Financial Snapshot 19
Slide 21: Margins Driven by Low Cost Deposits
Margins Driven by Low Cost Deposits Cost of funds (%) Net Interest Margin (%) 6.28 3.75 3.65 5.20 3.59 4.96 6.02 6.50 3.47 3.33 FY08 FY09 FY10 FY11 FY12 FY08 FY09 FY10 FY11 FY12 Current and Savings bank deposits (` bn) Low cost deposits ratio1 Savings deposits 46.7% 915 Current deposits 778 45.7% 66
Slide 22: Diversified Fee Income Franchise
Diversified Fee Income Franchise Fee income (` bn) Fee profile (FY12) Agri & SME 47.3 Business 6% Banking 9% 37.9 29.2 Large & Mid 24.5 Corporate Treasury & 37% Capital 14.9 Markets 21% Retail Banking 27% FY08 FY09 FY10 FY11 FY12 Fee Income as % of Operating Revenue 34.1% 37.2% 32.7% 33.9% 35.2% * F
Slide 23: Industry-wise Distribution
Industry-wise Distribution Outstanding as on 31st Mar 2012 (%)& Rank Sectors Total Fund-based Non-fund based 1. Financial Companies** 11.16 12.72 8.10 2. Power Generation 10.30 4.66 21.42 3. Infrastructure Construction* 8.79 6.80 12.71 4. Engineering & Electronics 6.24 3.35 11.94 5. Metal & Metal Pr
Slide 24: Superior Risk Management and Strong Asset Quality
Superior Risk Management and Strong Asset Quality Gross NPAs Net NPAs Net NPA (%) Gross NPAs (%) (` bn) 20 1.1% 1.2% Net NPA as at year-end 18 1.0% 1.0% 1.0% 16 0.9% 1.0% FY08 0.36% 14 0.7% 0.8% FY09 0.35% 12 0.6% 10 0.6% FY10 0.36% 8 0.4% 0.4% 0.4% FY11 0.26% 6 0.3% 0.4% 0.3% 4 FY12 0.25% 0.2% 2 4
Slide 25: Capital Strength
Capital Strength Capital Adequacy Ratio (%) Tier 1 capital ratio Tier 2 capital ratio Total Capital Adequacy Ratio 15.80% 13.73% 13.69% 13.66% 4.62% 12.65% 3.56% 4.21% 4.43% 3.24% 11.18% 10.17% 9.41% 9.45% 9.26% Mar'08 Mar'09 Mar'10 Mar'11 Mar'12 24
Slide 26: Summary
Summary – Gained market share and maintained above industry profitability Combining growth – Diversified revenue streams & profitability – Strong retail deposit franchise – Robust asset quality – Continue to build on key strengths of the franchise Aiming for – Leverage customer relationships with a
Slide 27: Safe Harbor
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”, “futu
Slide 28: Thank You
Thank You