SREI INFRASTRUCTURE FINANCE LIMITED INVESTOR PRESENTATION DEC 2015
WE ARE NOT JUST FINANCIERS! WE ARE PARTNERS IN HELPING BUILD BUSINESSES. WE PROVIDE MORE THAN JUST FINANCING. WE BRING INSIGHT, KNOWLEDGE, EXPERTISE AND CROSS-CATEGORY LEADERSHIP TO EVERY TRANSACTION.
DID YOU KNOW? 1 st Indian NBFC to access international markets for fund raising and 1 st Indian NBFC listed on the London Stock Exchange. st Promoted India's 1 st equipment banking Company Quippo. Quippo One of the largest infrastructure equipment rental company in the Country. Srei BNP Paribas India s largest construction and mining equipment financier with over ~30% market share. 1 st company to lay the ground for passive telecom infrastructure in India. Quippo Telecom The first company to enter into shared Passive telecom infrastructure in India. Quippo Telecom partnered with the Tata Teleservices and Viom has become one of the world s largest independent telecom infrastructure companies. 1 st to break new ground in rural IT infrastructure in India, under the National E-Governance Plan of the Government of India. Sahaj India s largest integrated rural network of over 27,931 Common Services Centres (CSC), covering 400 mn people (37% of India s rural population). Power Distribution Sector Power Distribution Network with T&D losses of only 2.25 % against country average of 25%. 1 st PPP in Water Distribution Sector Swach - Awarded the prestigious Nangloi PPP contract by Delhi Jal Board, in partnership with JV partner Veolia Water for water treatment and distribution. INNOVATION AND PIONEERING INITIATIVES IS THE HALLMARK OF
DISCUSSION SUMMARY COMPANY OVERVIEW FINANCIAL OVERVIEW.. BUSINESS VERTICALS.. KEY BUSINESS HIGHLIGHTS. INFRASTRUCTURE EQUIPMENT GROUP SREI BNP PARIBAS. INFRASTRUCTURE PROJECT GROUP DEBT PORTFOLIO LOAN BOOK EQUITY PORTFOLIO INVESTMENTS CONSOLIDATED FINANCIALS...
COMPANY OVERVIEW BUSINESS STRUCTURE FOCUSED INFRASTRUCTURE SOLUTION PROVIDER INFRASTRUCTURE EQUIPMENT GROUP INFRASTRUCTURE PROJECT GROUP EQUIPMENT FINANCING ASSET MANAGEMENT : DEBT EQUITY MEZZANINE CONSTRUCTION EQUIPMENT RENTALS EQUIPMENT VALUATION & AUCTIONS PROJECT FINANCE, INFRA DEBT FUND PE / VENTURE FUND, PROJECT EQUITY ADVISORY STRUCTURED FINANCE PROJECT ADVISORY CAPITAL MARKETS - INVESTMENT BANKING ADVISORY STRONG EXPERTISE ACROSS SECTORS - TRANSPORTATION, POWER, TELECOM, RURAL INFRASTRUCTURE, URBAN INFRASTRUCTURE, SEZ / INDUSTRIAL PARKS, PORTS END TO END INFRASTRUCTURE SOLUTIONS LEVERAGING OUR DEEP DOMAIN KNOWLEDGE ACROSS SECTORS AND STRONG RELATIONSHIPS IN THE INFRASTRUCTURE SPACE Copyrights Srei Infrastructure Finance Limited 2016 5
COMPANY OVERVIEW PRESENCE ACROSS INFRASTRUCTURE VALUE CHAIN AND VERTICALS INFRASTRUCTURE PROJECT GROUP THROUGH VARIOUS PRODUCT OFFERINGS : OFFERING Infra Finance Loan Book Equity Significant Road Assets Equity - Telecom Infra Equity - Social Infra 25 years of in-house expertise in Project Finance & Advisory. Disbursements of around Rs.318 bn from FY10 to YTD Dec 15 Current portfolio of 8 significant road projects of close to 3,264 lane kms. Well diversified BOT Asset Portfolio spread across 7 states. JV with Tata Teleservices India s largest independent tower company with 42,575 towers & highest tenancy ratio of 2.57x Largest network of over 27,931 CSCs across 6 states in India, rapidly expanding to new states INFRASTRUCTURE EQUIPMENT GROUP THROUGH ENTIRE EQUIPMENT LIFECYCLE : OFFERING Equipment Finance Construction Equipment Rentals Equipment Valuation & Auctions JV with BNP Paribas Market leader with ~30% market share Disbursements of around Rs.612 bn from FY10 to YTD Dec 15 One of India s largest infrastructure equipment rental company focussed on Construction. Leading Player with Pan India presence and in-depth knowledge of Construction Equipment segment offering valuation and auctioning services Copyrights Srei Infrastructure Finance Limited 2016 6
COMPANY OVERVIEW FINANCIAL OVERVIEW CONSOLIDATED FINANCIALS 9M FY16 FY15 SHARE PRICE DETAILS As on 31/12/2015 NSE Consolidated AUM 36,949 35,387 Net Income 577 1,114 PAT 52 129 Net Worth 3,232 3,174 ROAE (%) 2.6% 4.9% * CRAR (%) 18.0% 17.0% SHAREHOLDING PATTERN DEC 2015 Market Capitalization 2,800 Market Price (Rs) 55.65 No of Shares Outstanding (crs) 50.3 52-Wk High / Low (Rs) 71.00 / 30.10 INSTITUTIONAL HOLDING DEC 2015 Promoters 59% Individuals 10% Treasury Stock 10% Key Institutional Investors % Holding Fidelity 9.06 Vanguard Total International Stock index Fund 0.45 Foreign Holding 14% Pvt Corp Bodies 7% Dimensional Emerging Markets Value Fund 0.36 Japan Trustee Services Bank 0.30 Govt.Pension Fund Global 0.27 Wisdom Tree 0.24 Figures in Rs. crs * Standalone Copyrights Srei Infrastructure Finance Limited 2015 7
COMPANY OVERVIEW STRATEGIC & FINANCIAL ALLIANCES Our Credentials - Leading financial institutions have invested in and/or financed Srei and its subsidiaries/jvs Copyrights Srei Infrastructure Finance Limited 2016 8
CORPORATE GOVERNANCE BOARD OF DIRECTORS Salil K Gupta Chief Mentor Hemant Kanoria Chairman & Managing Director Sunil Kanoria Vice Chairman S. Rajagopal S. Chatterjee Dr. Punita Kumar Sinha Mr. T.C.A. Ranganathan Dr. Tamali Sen Gupta Former Chairman, West Bengal Industrial Development Corporation Limited (WBIDC) A leading State financial institution Former President, The Institute of Chartered Accountants of India (ICAI) Honorary Board Member of the Centre for Global Dialogue & Co-operation CGDC, Vienna Council Member, Indo-German Chamber of Commerce Former Chairman - National Committee on Infrastructure of Federation of Indian Chambers of Commerce & Industry (FICCI) Former President, Calcutta Chamber of Commerce Served as Member in Regional Direct Taxes Advisory Committee, Government of India Former Member of Board of Governors, Indian Institute of Management, Calcutta (IIMC) New Delhi Institute of Management - Board of Governors IIT Guwahati - Member of Board of Governors on behalf Srei Senior-Vice President - elect of The Associated Chambers of Commerce & Industry of India (ASSOCHAM) Governing body Member of the Construction Industry Development Council (CIDC) Council Member of the Institute of Chartered Accountants of India (ICAI) Served as Member of the Working Group on Construction for the Xth Five Year Plan of Planning Commission, Govt. of India Member of Central Direct Taxes Advisory Committee Served as President in Hire Purchase & Lease Association - Kolkata (HPLA); Merchants Chamber of Commerce - Kolkata (MCC) and Federation of Indian Hire Purchase Association (FIHPA) Over 42 years of experience in Banking Industry Former CMD of both Bank of India & Indian Bank Over 47 years of experience in Retail Commercial & Investment Banking and NBFC Former Executive Director, Axis Bank Limited, Mumbai Member of the Board of Directors of Nabil Bank, Nepal Extensive exposure in the area of International Banking having worked in SBI, London and as a Chief Representative in Washington D.C having worked closely with IFC, World Bank and IMF Over 23 years experience in asset management in international and emerging markets. Former Chief Investment Officer (CIO), Blackstone Asia Advisors L.L.C. and also served as a Senior Managing Director in The Blackstone Group LP Served as CIO and Senior Portfolio Manager, NYSE listed India Fund Inc. and Asia Tigers Fund Inc. Over 38 years of experience of spanning career with SBI, held diverse assignments in International Banking, Investment Banking, Corporate Finance, Corporate consultancy in addition to domestic banking as Branch head / Branch Controller, held Board positions in various SBI subsidiaries in North America, Africa and Asia He has also served as CMD of EXIM Bank of India Member of several Government of India overseas initiatives such as Indo-South Africa CEO Forum, Indo-Africa Business Council, Indo-Myanmar Joint Trade and Investment Forum etc Associated with some U.N arms for overseas consultancy apart from working as an arbitrator through the panels of NSE/BSE/NCDEX/Indian Council of Arbitration. Over 30 years experience in legal field and is a specialist in transnational legal transactions in media, real estate development, insurance and infrastructure Extensive experience in the structure of Projects implemented under project finance and on foreign participation in the Copyrights Srei Infrastructure Finance Limited 2015 privatization of Infrastructure, international joint-ventures, collaboration and licensing agreements, mergers and acquisitions 9
COMPANY OVERVIEW SNAPSHOT OF OUR BUSINESS VERTICALS INFRA EQUIPMENT GROUP INFRA PROJECT GROUP EQUIPMENT FINANCE - SREI BNP PARIBAS INFRA FINANCE STRATEGIC INVESTMENTS Key Metric 9M FY16 FY15 Total AUM 19,753 18,825 NIM 4.7% 4.9% ROAA 0.7% 0.9% ROAE 5.2% 7.2% CRAR 17.4 % 17.1% GROSS NPA 3.7% 4.7% NET NPA 2.8% 3.6% Figures in Rs. crs KEY STRATEGIC INVESTMENTS Key Metric 9M FY16 FY15 Loan Portfolio 12,920 12,243 Gross Spread 2.3% 3.5% ROAA 0.3% 0.6% ROAE 2.1% 3.4% CRAR 18.0% 17.0% GROSS NPA 4.6% 4.6% NET NPA 3.6% 3.8% Telecom Infra VIOM 1,598 BOT Road Assets 307 Rural IT Sahaj 11 Other Investments 38 FEE BASED Key Metric 9M FY16 FY15 Fee Income 42 161 # VIOM Telecom Infra (9M FY16) Total No of Towers 42,575 Tenancy 2.57x Gross Revenue 3,860 EBIDTA Margin % 58% Cash Profit 994 # 9M FY16 figures of Viom are estimate Significant Road BOT Asset Portfolio Total No of Projects 8 Operational Projects 5 To be Operational 3 Total Lane Kms 3,264 Current Cumulative Toll Revenue in Q3FY 16 104 Sahaj (9M FY16) Largest CSC network in India (~28% share) offering G2C, B2C & FI Services in 6 States. No. of CSCs 27,931 Sahaj Mandated Dist. 104 Population of Mandated Dist. (in Mn) ~ 400 SEZ & INDUSTRIAL PARK Over 2,991 acres of Land acquired for the development of SEZ & Industrial Parks. Mumbai SEZ / Industrial Park Industrial Park, WB Tamil Nadu SEZ 345 Acres 128 Acres 2518 Acres Copyrights Srei Infrastructure Finance Limited 2016 10
BUSINESS HIGHLIGHTS: 9M FY16 (CONSOLIDATED) Business Highlights Balance Sheet Profitability Loan Portfolio Analysis Group Disbursement stood at Rs.10,540 crs as compared to Rs.9,457 crs in same period previous year Equipment Finance disbursement was Rs. 6,611 crs in 9MFY16 as compared to Rs.6,200 crs in 9MFY 15 and Project Finance disbursement was Rs. 3,929 crs in 9MFY16 as compared to Rs. 3,257 crs in 9MFY 15 Consolidated Net Worth * stood at Rs 3,232 crs against Rs 3,183 crs in same period previous year, Consolidated Borrowings stood at Rs 21,201 crs as against Rs. 20,530 crs in 9MFY 15 Total Income stood at Rs. 2,443 crs as against Rs, 2,600 crs in same period previous year Profit Before Tax in 9MFY16 is Rs 81 crs as compared to Rs 184 crs in same period previous year, Profit after Tax (after minority) is Rs 52 crs as against Rs. 116 crs in same period previous year Forex Loss in 9MFY16 is Rs 18 crs, last year same period loss was Rs.19 crs. Interest Earning Portfolio of Equipment Financing is Rs 19,072 crs and that of Project Financing portfolio is Rs 13,758 crs Net NPA for Equipment Financing is 2.75 % and for Project Financing is 3.57%. * Change in Net Worth is due to change in its definition in Companies Act 2013 Copyrights Srei Infrastructure Finance Limited 2016 11
EQUIPMENT GROUP THE SREI ECO-SYSTEM Sustainable Competitive Advantage ASSET LIFECYCLE ASSET PURCHASE ASSET DEPLOYMENT ASSET MANAGEMENT ASSET EXIT / RESALE STANDALONE NBFC / FINANCER SREI - END TO END SOLUTION PROVIDER ACROSS THE VALUE CHAIN LEVERAGING THE SREI ECO-SYSTEM TO DELIVER Assisting in right equipment purchase. Customized financial solutions Loans & Advances Operating Lease Equipment on Rentals Equipment Banking Captive Contracts Hiring Contracts & Match Making Leveraging relationships to improve deployment of assets during downtime. Asset Maintenance - 32 captive stockyards for face lifting of assets. Thus improving residual value of assets. Yard Management Equipment Refurbishment Valuation & Inspection Valuation & Auctioning services Asset disposal services Advising on asset disposal & resale options. SREI BNP Paribas ZAO SREI QUIPPO CE SOLUTION PROVIDER SREI BNP Paribas SREI INFRA QUIPPO CE QUIPPO CE QUIPPO AUCTION QUIPPO AUCTION MANAGING CUSTOMER RELATIONSHIPS THROUGH THE ENTIRE ASSET LIFECYCLE Copyrights Srei Infrastructure Finance Limited 2016 12
SREI BNP PARIBAS ABOUT US STRONG PEDIGREE Srei BNP Paribas, is a 50:50 joint-venture between Srei Infrastructure Finance Limited India s only private sector NBFC in the infrastructure space BNP Paribas Lease Group the largest leasing group in Europe with a presence in over 15 countries. MARKET LEADERSHIP Largest construction & mining equipment financier in India with over ~30 % market share, with a customer base of over 45,000 built and nurtured over last 24 years. Have entered in new sectors like information technology, healthcare, rural, logistics etc. to tap the attractive growth opportunity. Current AUM of Rs.19,753 crs as on 31 st Dec, 2015. SREI Infrastructure Finance Ltd Leading Public Financial Institution in India Ownership BNP Paribas + Lease Group Amongst World s Largest Global Banks May 08 SREI Equipment Finance Pvt. Ltd. PRESENCE & TIE-UPs Pan-India distribution network of 86 branches including 15 state offices. Partnerships with all leading domestic & international equipment manufacturers & vendors. Full time employee base of close to 1,700 people as on 31 st Dec, 2015. Copyrights Srei Infrastructure Finance Limited 2015 13
SREI BNP PARIBAS FINANCIAL SUMMARY LOAN BOOK MARGIN ANALYSIS 6.0% 18,670 10,799 17,701 18,300 18807 19072 7,900 7719 6611 3972 5.0% 4.0% 3.0% 2.0% 1.0% 4.4% 3.8% 4.6% 4.86% 3.5% 3.48% 4.50% 4.68% 2.84% 3.04% FY13 FY14 FY15 H1FY'16 YTD Dec'15 Interest Earning Assets Disbursements RETURN RATIO & CRAR 0.0% FY13 FY14 FY15 H1FY'16 YTD Dec'15 Gross Interest Spread NIM ASSET QUALITY # 20.0% 15.0% 10.0% 5.0% 0.0% 1.8% 18.0% 16.5% 17.1% 17.52% 16.2% 1.3% 17.1% 11.3% 0.9% 7.2% 0.6% 0.67% 4.5% 5.22% FY13 FY14 FY15 H1FY'16 YTD Dec'15 ROANW CAR ROAA 2.0% 1.5% 1.0% 0.5% 0.0% 6.00% 4.78% 4.73% 5.00% 4.17% 3.70% 4.00% 3.91% 2.84% 3.64% 3.00% 3.16% 2.75% 2.00% 2.16% 1.00% 0.00% FY13 FY14 FY15 H1FY'16 YTD Dec'15 Gross NPA % Net NPA % # On Total Assets Copyrights Srei Infrastructure Finance Limited 2015 14
SREI BNP PARIBAS FAR-REACHING DISTRIBUTION NETWORK BRANCH NETWORK ZONE WISE PORTFOLIO SPLIT March 2015 Dec 2015 2 21 6 3 2 5 4 2 3 10 11 1 8 3 9 10 3 1 1 Zones North East West South Rs.18,300 crs No. of branches Rs.19,072 crs Disbursements (1) Dec 2015(Rs.crs) 18 1,527 23 1,372 18 1,706 30 2,006 89 6,611 Note 1: Finance Amount Well spread branch network helps (i) to tap growing demand & (ii) develop customer insights Copyrights Srei Infrastructure Finance Limited 2015 15
SREI BNP PARIBAS EQUIPMENT FINANCE VERTICALS Target Segment- Target Segment- Target Segment- Target Segment- Target Segment- First time owners/buyers Medium & Large customers Project Owners Large Fleet Owners Large corporates & IT companies System integrators OEM s, banking & financial institutions Hospitals Diagnostic Centers Contract farmers Tractor owners Retail, SME players ( used for construction, miming equipment & technology ) Strategy- Grow Vendor Finance Grow Retail & SME Reduce Strategic Portfolio to 50% Balance Portfolio growth Strengthen technology Talent development Strategy- Focus on AAA & AA customers Grow Vendor Financing Strategy- Direct sourcing Approach high end customers Form alliances Strategy- Alliances & Vendor Financing Select Asset Strategy- Alliances with manufacturers Select Asset Construction & Mining IT Infrastructure Healthcare Infrastructure Rural Infrastructure Used Copyrights Srei Infrastructure Finance Limited 2015 16
SREI BNP PARIBAS BALANCE SHEET OVERVIEW Balance Sheet Summary (Rs crs) 9M FY16 9M FY15 H1 FY16 FY15 Interest Earning Assets (incl. securitised) 19,072 18,239 18,807 18,300 Securitised Assets 1,972 1,813 1,917 2,053 Net Worth 2,290 2,190 2,248 2,209 Borrowings 13,672 13,434 13,384 13,065 Other Assets (Net) (1,292) (760) (1,226) (935) Key Ratios Dec-15 Dec-14 Sep-15 Mar-15 Return on Avg. Net Worth 5.2% 8.6% 4.5% 7.2% Return on Avg. Assets on Books 0.7% 1.1% 0.6% 0.9% Leverage 6.0 6.0 6.0 5.9 CRAR 17.4% 16.2% 18.0% 17.1% Copyrights Srei Infrastructure Finance Limited 2016 17
SREI BNP PARIBAS INCOME STATEMENT HIGHLIGHTS Income Statement (Rs crs) 9M FY16 9M FY15 Q3 FY16 Q3 FY15 Q2 FY16 FY15 Disbursement 6,611 6,200 2,639 1,481 2,223 7,719 Income from finance activities (Net of OL Dep.) 1,725 1,757 599 594 578 2,320 Finance charges (excl Forex Impact) 1,069 1,089 361 364 351 1,443 NII 657 668 238 230 227 877 NPA Provision & Write off 273 252 103 103 98 336 Provision on Standard Asset 10 2 2 (1) 0 0 NII (Net of Provision) 374 414 133 128 129 540 Other Income 1 8-0 0 8 Operating Expenditure 250 215 82 74 86 323 PBT before Forex M2M 125 207 51 54 43 226 Forex M2M 3 (0) 1 2 3 (1) PBT 123 207 50 52 40 227 PAT 88 137 37 34 28 153 Key Ratios Dec-15 Dec-14 Sep-15 Mar-15 Yield on Avg. Funds 13.7% 14.4% 13.5% 14.3% Cost of Funds 10.6% 10.8% 10.6% 10.8% Interest Spreads 3.0% 3.6% 2.8% 3.5% NIM 4.7% 5.0% 4.5% 4.9% Gross NPA* 3.7% 4.8% 4.2% 4.7% Net NPA* 2.8% 3.6% 3.2% 3.6% * On Total Assets Copyrights Srei Infrastructure Finance Limited 2016 18
SREI INFRASTRUCTURE FINANCE LTD INFRASTRUCTURE PROJECT GROUP Focused Infrastructure Solutions Provider across the entire value chain & verticals STRONG PEDIGREE & CREDENTIALS More than 2 decades of experience in Infrastructure space. Srei was classified as Infrastructure Finance Company (IFC) in the year 2011 and was also notified as Public Financial Institution (PFI) by the Ministry of Corporate Affairs. WIDE SPECTRUM OF PRODUCT OFFERINGS Customized project financing solutions across various sectors in infrastructure domain. Structured financing solutions that mitigate risk and provide flexibility for meeting unique needs of the customers. Strategic equity solutions for key infrastructure projects. Project advisory solutions. Investment banking advisory solutions providing an efficient channel to access capital markets. STRONG FINANCING CAPABILITIES Diversified across various sectors - Power, Ports, Logistics, Transportation, Urban Infrastructure, Airport/Aviation and Telecom. YTD Dec 15 Loan book Rs.12,920 crs (FY10 YTD Dec 15 CAGR 32%) YTD Dec 15 Investments Rs.2,687 cr Copyrights Srei Infrastructure Finance Limited 2016 19
SREI INFRASTRUCTURE FINANCE LTD KEY PRODUCT SEGMENTS Srei Infrastructure Finance Ltd FOCUSED INFRASTRUCTURE SOLUTIONS PROVIDER DEEP DOMAIN KNOWLEDGE AND STRONG RELATIONSHIPS ACROSS THE ENTIRE INFRASTRUCTURE SPACE PREFERRED PARTNER FOR MANAGING THE ENTIRE INFRASTRUCTURE PROJECT LIFECYCLE DEBT MEZZANINE EQUITY ADVISORY Customized project financing solutions - Project Finance Term Loan Syndicate Loan Lease Financing Sale & Lease Back Non-fund credit facilities Structured credit solutions that mitigate risk and provide flexibility for meeting unique needs of the customers Structured Debt Subordinated Debt Hybrid Equity Bridge Financing Strategic equity solutions for key infrastructure projects Transportation Telecom Infrastructure Power Rural IT Infrastructure SEZ & Industrial Parks Environment (Water & Waste Management) Project development & management solutions Advised more than 75 projects costing over Rs.75,000 crs. Investment banking advisory Mergers & Acquisitions Private Equity DCM, ECM & Corporate Advisory Copyrights Srei Infrastructure Finance Limited 2016 20
SREI INFRASTRUCTURE FINANCE LTD BALANCE SHEET OVERVIEW Balance Sheet Summary (Rs crs) 9M FY16 9M FY15 H1 FY16 FY15 Interest Earning Assets 13,758 12,661 13,587 12,853 Net Worth 2,712 2,668 2,695 2,657 Borrowings 14,231 13,662 13,896 13,696 Investments 2,687 2,870 2,650 2,839 Other Assets (Net) 809 1,086 670 947 Key Ratios Dec-15 Dec-14 Sep-15 Mar-15 Return on Avg. Net Worth 2.1% 3.8% 2.3% 3.4% Return on Avg. Assets 0.3% 0.6% 0.4% 0.5% Leverage 5.2 5.0 5.2 5.2 CRAR 18.0% 19.6% 18.5% 17.0% Copyrights Srei Infrastructure Finance Limited 2016 21
SREI INFRASTRUCTURE FINANCE LTD INCOME STATEMENT HIGHLIGHTS Income Statement (Rs crs) 9M FY16 9M FY15 Q3 FY16 Q3 FY15 Q2 FY16 FY15 Disbursement 3,929 3,257 775 1,382 2,151 4,827 Income from finance activities (Net of OL Dep.) 1,339 1,399 424 419 463 1,835 Finance charges (excl Forex Impact) 1,170 1,128 387 375 402 1,511 NII 169 272 37 44 61 324 NPA Provision & Write off 45 107 (5) 12 36 271 Provision on Standard Assets 7 1 1 1 4 0 NII (Net of Provision) 117 164 41 32 21 53 Fee Based Income 31 41 3 18 21 131 Income from Investment 1 2-1 1 52 Other Income 30 27 9 8 12 36 Operating Expenditure 104 113 34 30 36 143 PBT before Forex M2M 74 121 19 29 18 129 Forex M2M 12 11 1 5 7 9 PBT 62 109 17 24 12 120 PAT 43 74 12 16 8 91 Key Ratios Dec-15 Dec-14 Sep-15 Mar-15 Yield on Avg. Funds 13.7% 15.3% 14.2% 14.9% Cost of Funds 11.3% 11.4% 11.5% 11.4% Interest Spreads 2.2% 3.8% 2.6% 3.5% Gross NPA* 4.6% 2.9% 4.7% 4.6% Net NPA * 3.6% 2.0% 3.6% 3.7% * On Total Assets Copyrights Srei Infrastructure Finance Limited 2016 22
GROUP BORROWING PROFILE IMPROVING SHARE OF RETAIL SEGMENT CURRENT BORROWING PROFILE Currently, the Major source of Funding is Wholesale Funding through Banks. Consortium for: Srei BNP Paribas 37 banks, SREI Infra 30 banks. STRATEGY TO REDUCE COST OF FUNDS Reducing Cost of Funds through diversifying with Wide Spectrum of Lenders. Exploring new avenue and Increasing the share of Retail Funding through options like NCDs. BORROWING PROFILE SREI BNP BORROWING PROFILE SREI INFRA Domestic Term Loans 15% Foreign Currency Loans 8% Debenture 8% Debenture 14% Working Capital 53% Subordinates 8% Foreign Currency Loans 6% Others 1% Working Capital 60% Domestic Term Loans 18% Others 1% Subordinates 8% Copyrights Srei Infrastructure Finance Limited 2016 23
PROJECT FINANCE LOAN BOOK ANALYSIS 120% Loan Book Sectoral Breakup Power - 33% 100% 4% 4% 6% 4% 4% Generation - 30% T&D - 3% 80% 60% 20% 20% 20% 23% 22% 5% 5% 5% 5% 4% 8% 11% 12% 10% 10% Operational - 18% Under Construction - 12% 40% 30% 27% 27% 26% 26% 20% 33% 33% 30% 33% 33% Renewable - 1% Captive - 6% IPP/Merchant 5% 0% Mar 14 Dec14 Mar 15 Sep-15 Dec-15 Power Communication Social & Commercial Infra Transportation Oil & Gas Others Captive Fuel 2.6% Linkage Coal / Gas 2.4 Copyrights Srei Infrastructure Finance Limited 2016 24
EQUITY INVESTMENTS PORTFOLIO SUMMARY Summary of Investments Rs.crs Particulars Value (Value (Rs crs) Investment in Subsidiaries/JV 679 Strategic Investment * Communic ation 1598 Transportation 307 Energy 15 Rural IT 11 Others 38 Total Strategic Investment 1969 Treasury Stock (Srei Holding) @ 19 Equity Investment-Quoted 2 Equity Investment-Unquoted 6 Other Equity Investment 8 Total Non- Current Investment 2675 * Investments held directly or through funds @ Treasury Stock represents stock of Srei (48.6 mn shares) held by a trust on behalf of the company. The present market value of these shares is approximately Rs. 270 crs. @ As on 31st Dec, 2015 Copyrights Srei Infrastructure Finance Limited 2016 25
STRATEGIC INVESTMENTS TELECOM VIOM NETWORKS LTD TRANSPORTATION ROAD BOT PORTFOLIO SOCIAL RURAL SAHAJ SEZ/INDUSTRIAL PARK ENVIRONMENT MANAGEMENT
VIOM NETWORK COMPANY OVERVIEW STRONG PEDIGREE Viom Networks is a joint venture between Tata Teleservices Limited and Srei Infrastructure Finance Limited. Viom is India s largest independent telecommunication infrastructure service provider. Strong equity support from institutional investors such as Macquarie SBI Infrastructure Fund led consortium, GIC Investments Pte Ltd. Singapore, IDFC Private Equity and Funderburk Mauritius Ltd. (Oman Investment Fund) Strategic relationships with all leading telecom operators in India Tata Teleservices, Bharti Airtel, Aircel, MTS, Vodafone, Idea, Telewings and BSNL among others ASSET PORTFOLIO & FINANCIAL HIGHLIGHTS 42,575 high quality towers with an industry leading tenancy ratio of 2.57x. Well diversified presence across India Metro (11%), Circle A (36%), Circle B (40%) & Circle C (13%). 50% of towers less than 3 years old, leading to efficient performance. Majority of portfolio connected to grid power (97%) highest in the industry. 1,500 newly re-engineered ultra-light towers with 50% lower capex requirement, which are profitable even at single tenancy. YTD Dec 15 Financials (unaudited) Revenue* of Rs. 3,860 crs and EBITDA of Rs.1,483 crs with *EBIDTA margin (excl. energy) of 58 % and Cash Profit of Rs.994 crs. * Excludes prior period & extraordinary income BUSINESS MODEL Long term contracts Typically 10-20 year contracts with key tenants (including TATA Group, Aircel, MTS and Telenor) Difficult break clauses ROFO / Preferred customer status Revenue Visibility & Lock-Ins 12-15 years lock-ins with TATA Group 7 year lock-ins with Telenor, MTS and Aircel 5-7 year lock-ins with incumbent telcos Around 6 years of locked in predictable revenue of Rs.18,600 crs Tenancy Stickiness Strategic pan India tower locations Increasingly difficult new acquisitions leading to high entry barriers Copyrights Srei Infrastructure Finance Limited 2016 27
VIOM NETWORK ASSET PORTFOLIO-SCALABILITY & TENANT MIX 45000 40000 35000 30000 25000 20000 15000 10000 5000 0 120 100 80 60 40 20 0 3400 SCALABILITY & TENANCY RATIO 1.62 18500 1.32 36407 38459 40403 40690 41956 42344 42533 42575 2.05 2.21 2.26 2.09 2.2 TENANCY MIX (%) 2.37 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 H1 FY16 Total No of Towers 41 42 45 3.0 2.51 2.572.5 YTD Dec'15 Tenancy Ratio (No of Tenants per Tower) 19 16 13 14 17 17 17 12 12 11 11 10 22 21 12 14 15 18 20 6 8 18 18 12 13 22 43 23 23 23 38 34 32 30 FY11 FY12 FY13 FY14 FY15 H1 FY16 YTD Dec'15 Tata Incumbents Others Uninor New Entrants 2.0 1.5 1.0 0.5 0.0 High Scalability No of Towers have increased from 3,400 towers in FY08 to 42,575 towers currently growing at a CAGR of 39%. Present tenancy of 1,09,324 growing at CAGR of 51 % over last 8 years. Tenancy Ratio - Highest Tenancy Ratio of 2.57x as compared to industry average tenancy ratio of 1.7x. Independent Tower Company Low dependence on Anchor Tenants with More than 67% of the tenancy is from Non-Tata service operators. Robust portfolio Mix - Share of incumbents and other operators increased from 18% to 43% from FY 11 to YTD DEC 15 Copyrights Srei Infrastructure Finance Limited 2016 28
VIOM NETWORK FINANCIAL HIGHLIGHTS Particulars (Rs Cr) FY11 FY12 FY13 FY14 FY15 YTD DEC 15 (unaudited) Total No of Towers 38,500 40,000 40,690 41,689 42,344 42,575 Tenancy Ratio (No of Tenants per Tower) 2.4 2.4 2.2 2.2 2.37 2.57 Revenues - Service Income 2,956 3,246 3,296 2,949 3,139 2,513 Revenues - Pass Through (Energy) 1,413 1,537 1,651 1,677 1,686 1,347 Total Revenue * 4,369 4,783 4,947 4,626 4,825 3,860 EBIDTA 1,361 1,545 1,860 1,764 1,801 1,483 *EBIDTA Margin % - W/O Pass Through 46.0% 47.6% 54% 56% 56% 58% Cash Profit 558 568 892 919 1,039 994 Total Debt 8,128 8,048 7,383 6,420 6,069 5,562 Strong annuity income with long term contracts. Lock-in revenues of more than Rs.186 bn. Incremental margins in the range of 50-70% due to better efficiency & lower capex. Strong cash profits & well managed capital structure. Net Debt reduction of more than Rs.2,480 crs over last 4 years to Rs.5,562 crs currently. * excl. prior period & extraordinary income Copyrights Srei Infrastructure Finance Limited 2016 29
EQUITY PORTFOLIO - INVESTMENTS TELECOM VIOM NETWORKS LTD TRANSPORTATION ROAD BOT PORTFOLIO SOCIAL RURAL SAHAJ SEZ/INDUSTRIAL PARK ENVIRONMENT MANAGEMENT
BOT ROAD ASSETS PORTFOLIO SUMMARY WELL DIVERSIFIED PORTFOLIO Execution Experience spread across 14 Road Projects on BOT/Annuity with over 5,400 lane Kms of Road Projects across India Well diversified BOT Asset Portfolio spread across 7 states such as Madhya Pradesh, Maharashtra, Uttar Pradesh, Kerala, Arunachal Pradesh, Odisha & Haryana. STRONG ANNUITY CASH FLOWS Out of Total 8 Projects in which Srei has significant economic interest, 5 projects are already operational with cumulative Annual Gross Revenue of more than Rs. 272 crs for the nine month ended 31 st Dec 2015. One BOT project became operational in June 15 and another one is expected to be fully operational by the end of FY16, thus resulting into strong Revenue growth & further Improved Cash Flows. % State Wise BOT Portfolio (Lane Km) Road BOT Asset Portfolio Total No of Projects* 8 Arunachal Pradesh No of Projects Operational 5 23% 12% 15% 25% 8% 6% 10% Kerala Madhya Pradesh Haryana Uttar Pradesh Odisha Maharashtra No of Projects - Under Construction 3 Total Lane Kms 3,264 Lane Km Operational 1,690 Lane Km Under Construction 1,574 Gross Revenue Realized per Lane km (for Q3 FY16) 0.062 crs * Projects where the Company has Significant stake Copyrights Srei Infrastructure Finance Limited 2015 31
BOT ROAD ASSETS PORTFOLIO SIGNIFICANT OPERATIONAL ASSETS Particulars 4/6 Laning of Thirssur - Angamali, NH-47 4 Laning of Indore Ujjain Road on SH-27 4 Laning of Rohtak-Bawal section of NH-71 4/6 Laning of Gaziabad- Aligarh Section of NH 91 6 Laning of Chandikhole Bhubaneswar Section of NH-5 Project Cost (Rs.crs) 726 331 1,039 2,186 1,769 Project Type Toll Toll Toll Toll Toll Concession Period (Yrs) 22 25 28 24 26 Project Road Length (Km) 65 49 83 125 67 Project Lane Km 260 196 332 500 402 State Kerala Madhya Pradesh Haryana Uttar Pradesh Odisha Awarding Authority NHAI MPRDC NHAI NHAI NHAI Project COD Dec-11 Nov-10 Sep-13 Jun-15 # Apr-16* 4 / 6 laning project, tolling started from the Appointed Date. # Partial COD achieved. Full COD expected on Apr 16 Copyrights Srei Infrastructure Finance Limited 2015 32
BOT ROAD ASSETS PORTFOLIO SIGNIFICANT OPERATIONAL ASSETS Total Toll Collection (Rs Crs) 150 100 50 61 60 66 72 71 97 104 0 Q1 FY15 Q2FY15 Q3FY15 Q4FY15 Q1 FY16 Q2FY16 Q3FY16 TOLL COLLECTIION (Rs.crs) Thirssur Angamali, NH-47 Indore Ujjain Road on SH-27 Chandikhole Bhubaneswar Section of NH-5 Rohtak-Bawal section of NH-71 Ghaziabad- Aligarh Section of NH 91 Total Q1FY15 21 6 19 15-61 Q2 FY15 22 5 18 15-60 Q3 FY15 24 6 19 17-66 Q4 FY15 28 6 20 18-72 Q1 FY16 25 6 20 18 2* 71 Q2FY16 25 5 20 17 30 97 Q3FY16 25 6 21 20 33 104 * Toll commenced on 25 th June 2015 Copyrights Srei Infrastructure Finance Limited 2015 33
BOT ROAD ASSETS PORTFOLIO UNDER CONSTRUCTION ASSETS Particulars 2/4 Laning of Rimuli- Roxy-Rajamunda Section of NH 215 4 Laning of Solapur Maharashtra/ Karnataka Border Section of NH-9 2 Laning of Potin Pangin Section of NH-229 Project Cost (Rs.crs) 972 883 1662 Project Type Toll Toll Annuity Concession Period (Yrs) 19 25 17 Project Road Length (Km) 96 100 407 Project Lane Km 360 400 814 State Odisha Maharashtra Arunachal Pradesh Awarding Authority NHAI NHAI MoRTH Project COD June-18 Nov-16 54 months from appointed date Copyrights Srei Infrastructure Finance Limited 2015 34
EQUITY PORTFOLIO - INVESTMENTS TELECOM VIOM NETWORKS LTD TRANSPORTATION ROAD BOT PORTFOLIO SOCIAL RURAL SAHAJ SEZ/INDUSTRIAL PARK ENVIRONMENT MANAGEMENT
SAHAJ LARGEST CSC NETWORK IN THE COUNTRY SAHAJ E-VILLAGE A Unique Public Private Partnership to bridge the Urban-Rural Digital Divide in India Largest CSC Network in the country 27,931 CSCs across six sates West Bengal(WB), Uttar Pradesh (UP), Bihar, Assam, Tamil Nadu (TN) & Odisha Covering 400 mn people (37% of India s rural population) EXTENSIVE RURAL DISTRIBUTION PLATFORM Technology Leveraging Operating Model Robust technology platform offering real-time connectivity, efficient & quick service delivery Wide offering of Products & Services Wide Bouquet of Products & Services across G2C, BFSI, B2C & Education services. Highly leveraged to offer wide range of products & services McKinsey Operating Model for Growth Easy to use, high quality technology platform Spread of VLE touch-points Focus on Pull Services with strong partners Activation of G2C services across all states & increase financial inclusion presence STATE No of Outlets WB 6,579 UP 8,536 Bihar 5,528 Assam 2,896 TN 1,362 Odisha 3,030 Copyrights Srei Infrastructure Finance Limited 2016 36
SAHAJ A UNIQUE BUSINESS MODEL NATURAL MONOPOLY WITH STRONG ENTRY BARRIERS Exclusive mandate to operate CSC network across existing 6 states Strong experience and capabilities to effectively operate in rural conditions Established back-end infrastructure with limited execution risk and strong scale-up potential Established partnerships and tie-ups with leading product & services companies CURRENT & POTENTIAL PRODUCT & SERVICE OFFERGINS G2C B2C E-LEARNING NEW OPPORTUNITIES Land records, Income & Caste Certificates, registration & revenue collection, electoral services, employment exchange, passport, ration card, IT return, tax payments, certificates etc. Life & General Insurance, Mutual Funds, Utility bills, Mobile & DTH recharges, FMCG & FMCD, K12 Education, Computer training, distance Computer education etc. Financial Inclusion BC White Label ATMs, Remittances Fabdeal, Amazon, Aadhar UIDAI / NPR, UTI PAN services, Water, ATM etc Copyrights Srei Infrastructure Finance Limited 2016 37
SAHAJ TECHNOLOGY LEVERAGED OPERATIONAL MODEL G2C Service partners (State & Central) B2C Service partners (Financial Services, Education, Health Services, Rural Media & CUPS Cash management and information flow addressed through real Time Transaction and voucher based funds flow Real time monitoring and reconciliation Data centre Cash Services Village VLE in CSC Vouchers Voucher based cash management Copyrights Srei Infrastructure Finance Limited 2016 38
SAHAJ KEY ALLIANCE PARTNERS Copyrights Srei Infrastructure Finance Limited 2015 39
EQUITY PORTFOLIO - INVESTMENTS TELECOM VIOM NETWORKS LTD TRANSPORTATION ROAD BOT PORTFOLIO SOCIAL RURAL SAHAJ SEZ/INDUSTRIAL PARK ENVIRONMENT MANAGEMENT
SEZ & INDUSTRIAL PARKS KEY HIGHLIGHTS Srei ventured into greenfield development of Special Economic Zones and Industrial Parks in 2008-09 to capitalise on India s growing need for rapid industrial growth Services & Education City, Mumbai ( Attivo Economic Zone, Mumbai ) Biotech, IT / ITeS SEZ, residential units, commercial,resort, etc, located on Alibag - Mumbai Road 60 Km from south Mumbai. Total Project Area: 350 acres (Phase 1) Acquired Area : 345 acres Industrial Park, Kharagpur ( Attivo Economic Zone, Kolkata) Industrial Park near Kharagpur, West Bengal. In partnership with West Bengal Industrial Infrastructure Development Corporation (WBIIDC). Total Project Area: 325 acres Acquired Area : 128 acres Multi Product SEZ at Nanguneri, Tamil Nadu ( AMRL Hitech City ) The total project area: 2518 acres. 1,700 acres for industrial processing zone. 818 acres for residential township / commercial and other non-processing activities. Phase 1 1104 acres launched Fully acquired Copyrights Srei Infrastructure Finance Limited 2016 41
EQUITY PORTFOLIO - INVESTMENTS TELECOM VIOM NETWORKS LTD TRANSPORTATION ROAD BOT PORTFOLIO SOCIAL RURAL SAHAJ SEZ/INDUSTRIAL PARK ENVIRONMENT MANAGEMENT
ENVIRONMENT MANAGEMENT KEY HIGHLIGHTS Srei Swach project provides an integrated solution to water and waste water management, solid waste management and recycling Business Model Provides cutting edge solutions with world class technology to water and waste water management, solid waste management and recycling to both public and private sectors Project Under Implementation Awarded with the prestigious Nangloi Water Supply (PPP) contract in Delhi, in partnership with JV partner Veolia Water The contract is of 15 years and around $ 85 million will be invested in the water treatment and distribution system. Project taken over during Sept 2013 from Delhi Jal Board (DJB) and is under implementation Global Technology Partners Copyrights Srei Infrastructure Finance Limited 2016 43
SREI INFRASTRUCTURE CONSOLIDATED BALANCE SHEET OVERVIEW Balance Sheet Summary (Rs crs) 9MFY16 9M FY15 H1 FY16 FY15 Net Worth 3,232 3,183 3,208 3,174 Borrowings 21,201 20,530 20,730 20,326 Interest Earning Assets 22,280 20,856 22,036 20,870 Investments 2,189 2,328 2,094 2,250 Other Assets 602 1,016 457 892 Key Ratios Dec-15 Dec-14 Sep-15 Mar-15 Return on Avg. Net Worth 2.6% 5.9% 2.6% 4.9% Return on Avg. Assets 0.3% 0.6% 0.3% 0.5% Leverage 5.8 5.7 5.7 5.7 EPS (Rs) (Annualised) 1.4 3.0 1.4 2.5 Book value (Rs) 64.3 63.3 63.8 63.1 Copyrights Srei Infrastructure Finance Limited 2016 44
SREI INFRASTRUCTURE CONSOLIDATED INCOME STATEMENT HIGHLIGHTS Income Statement (Rs crs) 9M FY16 9M FY15 Q3 FY16 Q3 FY15 Q2 FY16 FY15 Income from Finance Activities 2,198 2,252 719 707 753 2,960 Income from equip. financing 863 878 299 297 289 1,160 Income from project financing 1,335 1,373 419 410 464 1,799 Finance charges (excl Forex Impact) 1,714 1,693 567 563 584 2,261 NII 484 558 152 144 169 699 Non Interest Income Income from Fee Based Activities 42 66 6 21 24 161 Income from Equipment Rental 16 127 5 44 5 152 Income from Investments 1 6 0 1 1 57 Others 33 33 12 11 14 45 Net Income 577 789 176 221 213 1114 Operating Expenditure 275 317 90 109 92 425 Provisions & Write offs 203 269 53 72 92 487 PBT before Forex M2M 99 203 33 39 29 202 Forex M2M 18 19 5 6 10 13 PBT 81 184 28 32 19 188 PAT (after Minority) 52 116 17 24 12 129 Copyrights Srei Infrastructure Finance Limited 2016 45
FOR ANY FURTHER QUERIES, PLEASE CONTACT: Sanjeev Sancheti Chief Strategy Officer Srei Infrastructure Finance Ltd. Tel: + 91 33 6602 3003 Email: ssancheti@srei.com Amit Agarwal AVP Investor Relations Srei Infrastructure Finance Ltd. Tel: + 91 33 6602 3003 Email : amit.agarwal1@srei.com Ammeet Sabarwal Dickenson Seagull IR Mobile: +91 9819576873 Email : ammeet.sabarwal@dickensonworld.com Disclaimer In this communication we have disclosed certain forward-looking information to enable investors to comprehend our future prospects and take informed investment decisions. This report and other statements written and/or verbal - that we periodically make/publish contain forward-looking statements that set out anticipated results based on the management's plans and assumptions for future growth and development of the organizations. We have tried wherever possible to identify such statements by using words such as anticipate, estimate, expects, projects, intends, plans, believe, and words of similar substance in connection with any discussion of future performance. We do not guarantee, warrant and/or recommend, express or implied, as to the accuracy or completeness of such assumptions and that these forward-looking statements will be realized, although we believe we have been prudent in assumptions which are subject to dynamic changes. The achievement of results is subject to risks, uncertainties and even inaccurate assumptions. Should known or unknown risks or uncertainties materialize, or should underlying assumptions prove inaccurate, actual results could vary materially from those anticipated, estimated or projected. Prospective investors are recommended to take there decisions based on interpretations and assumption of such published forward looking statements.. We undertake no obligation to publicly update any forward-looking statement, whether as a result of new information, future events or otherwise. Moreover, neither we or any other company or subsidiary of the Srei Group, nor any of its officers, directors or employees accept any liability or responsibility in respect to the information or any assumptions expressed herein. The information contained herein has been prepared exclusively for informational purposes and is not an offer or solicitation of an offer to buy/sell the securities/instruments mentioned or to participate in any trading strategy or an official confirmation. This is not a research but it may refer to a research analyst/research report.. Information is subject to change without notice and we may not update this. Past performance is not indicative of future returns. This price information (if any) is provided solely for informational purposes and may differ substantially from price information available from other sources or an actionable price. Copyrights Srei Infrastructure Finance Limited 2016 46