Analyst Meet / AGM - Analyst Meet

24-Apr-2015, 11:57
Mahindra and Mahindra Financial Services conducted an analyst meet on 23 April 2015 to discuss the financial performance for the quarter ended March 2015 and prospects of the company. Ramesh Iyer, MD, Mahindra & Mahindra Financial Services addressed the call:

Highlights:

• The company exhibited healthy performance supported by strong collection performance in Q4FY2015.
• The collection efficiencies improved above 100% in Q4FY2015 compared with around 92-93% in the previous two quarters.
• The consistent efforts of the company have helped to improve asset quality in Q4FY2015. The company proposes avoid any new accounts slippages.
• The number of NPA customers has remained stable at 66 thousands at end March 2015 same as at a year ago level.
• The company has identified four key business drivers as 1. chase recoveries and not growth, 2. build strong customer relationships, 3. no unnecessary innovation, have simple products and 4. network penetration and expansion.
• The company is looking at singles for growth revival such as 1. discontinuation of discounts on auto sales, 2. pick in demand for used vehicles, 3. no demand for higher LTV from customers and 4. timely customer payments.
• The company has added above 200 branches in FY15 raising the branch count to 1108 offices at end March 2015, while building access to about 2 lakh. As per the company, India has total 4 lakh commercially viable villages out of 6 lakh villages. Thus, the company has scope to add 1000 branches to build access to 4 lakh villages.
• The margins of the company were supported by higher collection performance, while lower cost of funds also pushed up margins.
• The company is following 150 days past due (dpd) NPA recognition norms, while it is looking at ways to reach the 90 dpd norms.
• As per the company, initial green shoots of the recovery will be offered by commercial vehicles (CVs) segment.
• About 90% of the customers are earn and pay customers.

Subsidiaries

• Mahindra Rural Housing Finance has presence across 9 states with 40 thousand villages under coverage. The company has a customer base of 2.65 lakh at end March 2015. Its average loan ticket size stands at Rs 1 lakh, while the customer has average annual income of Rs 1.5 lakh. The company would focus on strengthening the network, while sees opportunities from the tier IV towns with affordable housing segment.
• Mahindra Insurance Brokers offering direct broking and re-insurance services has touched a premium collection of Rs 1008 crore in FY2015. The company has build reach to 30 countries to develop re-insurance business. The company opposes to emerge as top 20 global insurance broker by 2020.
• Regarding the new business segment, the company may be interested in entering the SME segment.

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