Bajaj Auto Limited · NSE:BAJAJ_AUTO
Bajaj Auto — Bajaj Allianz General Insurance — Investor Presentation (June 2007)
22 slides from Bajaj Auto's investor presentation, Jun 23, 2007
Slide 1: Bajaj Allianz General Insurance
Bajaj Allianz General Insurance Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 1
Slide 2: Agenda
AGENDA General General Insurance Insurance Industry Industry Financial Financial performance performance Business Business mix mix and and ratios ratios Milestones Milestones Focus Focus areas areas Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 2
Slide 3: General Insurance Industry
General Insurance Industry Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 3
Slide 4: Privatized in 2001/02…
Privatized in 2001/02… 2000-01 2006-07 4 (Govt) + 8 ( private) + ECGC Number of companies 4 (Govt) + ECGC + 1 health PSUs, ICICI Lombard, Bajaj Major players Public Sector Allianz, Reliance, Iffco Tokio, TATA AIG Rs 114 Bn (01/02) circa Gross Written premium Rs 250 Bn circa USD 6 bn USD 2.5 bn Mostl
Slide 5: Industry snapshot
Industry snapshot Last 3 (Rs Mn) 06-07 05-06 Growth Share Accretion months ICICI 30,030 15,920 89% 12.0% 14,110 83% BJAZ 18,030 12,850 40% 7.2% 5,180 55% ITGI 11,500 8,960 28% 4.6% 2,540 -4% Reliance 9,120 1,620 463% 3.6% 7,500 492% TATA AIG 7,420 6,120 21% 3.0% 1,290 -2% RSA 6,000 4,590 31% 2.4% 1,
Slide 6: Financial Performance
Financial Performance Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 6
Slide 7: Story so far
Story so far (Rs Mn) 2001-02 2006-07 Gross Written Premium 308 18,030 Underwriting Profits -320 249 Profit Before Tax -182 1,170 Profit After Tax -182 753 Number of Policies (nos) 310,000 4,863,000 Number of Claim settled (nos) 309,000 Number of employees on rolls 141 2,540 Motor mix 100% 47% Invest
Slide 8: Summarized results 2006/07
Summarized results 2006/07 (Rs Mn) 2006-07 2005-06 Gross Premium 18,033 12,846 Underwriting result 254 271 Investment Income 895 527 Other income 21 21 Profit Before Tax 1,170 818 Profit After Tax 754 516 Technical Reserve 9,764 6,362 Cash + Investment 15,244 8,561 Total Assets 16,961 10,633 Capital
Slide 9: Business Mix and Ratios
Business Mix and Ratios Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 9
Slide 10: Business mix – pre and post de tariff
Business mix – pre and post de tariff Jan - Mar Business Group 2005-06 Apr - Dec 06 07 CORPORATE (Fire/ Engg / Marine) 42% 40% 26% MOTOR 42% 43% 56% OTHERS (MAINLY RETAIL) 16% 17% 18% Bajaj Allianz is seeing a greater shift towards retail, which has been our strength from inception Bajaj Allianz Gen
Slide 11: Loss and combined ratios FY07
Loss and combined ratios FY07 Loss and combined ratios 110% 105% 104% 98% 98% 97% 100% 92% 90% 80% 76% 70% 66% 64% 60% 50% 40% ICICI BJAZ Rest of Private Cos. Loss Ratio Combined ratio Economic combined ratio Bajaj Allianz had lowest combined ratio – both accounting and economic •Economic combined r
Slide 12: Breakdown of combined ratio FY 07
Breakdown of combined ratio FY 07 Breakdown of Combined Ratio 100% 80% 60% 40% 20% 0% -20% PSUs ICICI BJAZ Rest of Pvt Cos. Mgmt Expenses 35% 47% 41% 48% Net Commission 6% -18% -9% -8% Claims 92% 76% 66% 64% Claims Net Commission Mgmt Expenses PSUs 2005/06 numbers Bajaj Allianz has one of the lowest
Slide 13: Capital efficiency 31 March 2007
Capital efficiency 31 March 2007 Net premium / Net (Rs Mn) Capital Net Worth worth ICICI 72,110 94,260 1.13 BJAZ 20,770 40,340 2.08 Tata AIG 22,500 24,380 1.57 ITGI 25,000 29,670 1.85 High efficiency of capital translates in high ROE – BJAZ is only company to have ROE > 20% for 3rd year running Baja
Slide 14: Sources of profit (2006/07)
Sources of profit (2006/07) 120% 100% 80% 60% 40% 20% 0% -20% -40% ICICI BJAZ Rest of Pvt Cos. IUNDERWRITING -69% 21% -57% INTESEST 115% 70% 142% CAPITAL GAIN 54% 10% 15% CAPITAL GAIN INTESEST IUNDERWRITING Striking the right balance between underwriting, sustainable investment income is part of our
Slide 15: Strong cash generation
Strong cash generation Rs. Mn Free Cash Flow Cash Flow/GWP ICICI 4,976 17% BJAZ 5,736 32% Rest of Private Sector. 17% Free Cash flow = total increase in investible surplus less financing cash flows Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 15
Slide 16: Return on equity continues above 20%
Return on equity continues above 20% 25% 20% 15% 10% 5% 0% ICICI BJAZ Rest of Pvt Cos. 0607 10% 22% 8% 0506 15% 22% 6% 0607 0506 BJAZ has been best in class for last 3 years Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 16
Slide 17: Per share key values
Per share key values Cash Book EPS Flow/Share Value/Share ICICI 2.15 14.82 27.71 BJAZ 6.85 52.08 37.37 Rest of Pvt. Cos. 0.90 6.96 12.33 •Based on shares of Re 10/- paid up value •Cash flow equals increase in cash and investments during the year less financing cash flows. •Cash flow per share is on
Slide 18: Milestones
Milestones Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 18
Slide 19: Milestones – 06-07
Milestones – 06-07 Above market growth o Achieved gross written premium (GWP) > Rs 18 Bn. o Maintained 2nd position amongst private players and 6/12 overall Market share grew o From 6.3% in 2005/06 to 7.2% in 2006/07 Fourth successive year of underwriting profits – only private sector company to hav
Slide 20: Focus Area – (2007-08)
Focus Area – (2007-08) Bajaj Allianz General Insurance Co. Ltd. <23rd June 2007> 20
Slide 21: BAGIC – Focus Areas (2007-08)
BAGIC – Focus Areas (2007-08) •Expand reach - Target of 175 offices by March 08. •Leverage first class banking Smart Smart relationships – HDFC, UTI. distribution distribution •Increasing agents’ productivity – enlarge agent base. •Push online / walk-in channels Diversified Diversified product •New
Slide 22: Thank you
Thank you No part of this presentation is to be circulated, quoted, or reproduced for any distribution without prior written approval from Bajaj Allianz General Insurance Company Limited, GE Plaza,Yerwada, Pune-411 006, India. Certain part of this presentation describing estimates, objectives and pr
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