U GRO Capital | An Overview
The Indian SME Lending Market
A large yet untapped market opportunity
2
61.0
64.4
FY18 FY19
FDI Net Inflows ($ B)
Investors Still Bullish On Long Term Growth Prospects
Despite Near-Term Headwinds, the Indian Economy is Anchored by Political Stability and Long-Term Structural Reforms
3
Sustained Growth Despite Near-Term Challenges
7.4%8.0% 8.2%
7.2%6.8%
5.0%5.9%
FY15 FY16 FY17 FY18 FY19 FY20F FY21F
Real GDP Growth Rate
-25
0
25
50
75
Mar-16 Sep-16 Mar-17 Sep-17 Mar-18 Sep-18 Mar-19
Consumer Confidence Perception
Current 1-Year
Consumer Confidence Improving Signaling Spending Growth Revival
Unprecedented Structural And Political Stability Facilitating Long Term Reforms
▪ Corporate Insolvency Resolution Process yieldedresolution of 94 cases with total claims settlement of$24.2B as of March 2019
▪ India’s new 15% tax rate (down from 35%) on newmanufacturers is the lowest amongst its peers, andwill drive growth for manufacturing-based SMEs
▪ PSU Banks have been consolidated for operationalefficiencies, coupled with a $7.8B capital infusion toreinvigorate the financial sector
The NBFC Liquidity Crunch is Transitional in Nature
▪ Current liquidity crunch an outcome of idiosyncraticgovernance issues in certain NBFCs
▪ Subsequent slowdown in the auto, SME segments re-emphasizes the critical role played by NBFCs
▪ Intervention from the Central Gov/RBI very likely –Increasing bank exposure limits, classification of creditfor on-lending to SMEs up to $28.5K as PSL
▪ The RBI has instituted a Partial Guarantee Scheme forNBFCs, with $5.6B sanctioned and $1.4B alreadydisbursed
▪ First government with an outright majority since 1984
▪ Geopolitical stability has been maintained despitesporadic flare-ups | India has moved to 4th on the Asia-Pacific Power Index
▪ Inflation (3.3% YoY rising to 4.0% by Sep ‘20) and thefiscal deficit are well under control
▪ India jumped from 77th to 63rd in the World Bank’s ease-of-doing-business index, the third year in a row that Indiahas been among the top 10 improvers in rank
The broader economy and the NBFC sector expected are expected to normalize in 2020
▪ Real Private Final Consumption Expenditure (PFCE) willincrease from 5.5% in 2019-20 to 7.0% in 2020-21
India Represents a Large, Significantly Underpenetrated Credit Market
One of the largest and fastest growing economies in the world
However, the credit to GDP ratio is still much lower than other markets
Leading to high credit growth in the country led by the NBFC sector
Significant government impetus for the growth of credit
14.1 13.9
9.010.9
8.210.0
17.915.6
18.816.6
14.6
21.2
FY13 FY14 FY15 FY16 FY17 FY18
Credit Growth Rate (%)
Bank NBFC
▪ Grant of universal banking, payment banking and small finance banking licenses
▪ Focus on financial inclusion – Jan Dhan Yojana1, Pradhan Mantri Awas Yojana2
▪ India Stack – Cashless, Paperless, Presence-less
▪ Credit guarantee scheme for MSMEs
4
25.120.2
10.35.5 4.2 4.0
China US India Japan Germany Russia
6.1% 2.1% 5.0% 1.9% 0.6% 1.7%
GDP PPP – $ T, Real GDP Growth
160.0%
73.6%44.8%
99.9%54.3% 49.1%
China US India Japan Germany Russia
Total credit to non-financial corporations as a % of GDP
154.3 178.6 212.9254.3
297.1338.6
385.7
FY14 FY15 FY16 FY17 FY18 FY19E FY20P
Total credit to the private non-financial sector ($ B)
The overall lending market in India is expected to grow at 10-11% with NBFCs growing at 15-17% over the
next 5 years
~$1T lending opportunity over the next 5-6 years | Significant head-room for many more banks and NBFCs to emerge !
1Jan Dhan Yojna: A govt initiative to ensure that every individual has a bank account; 2A govt initiative to ensure housing for all by incentivizing low cost housing and providing access to credit; 3set of APIs that allows businesses, startups to utilize an unique digital Infrastructure to solve India’s hard problems towards presence-less, paperless, and cashless service delivery (Aadhar, eKYC, Unified Payments Interface)
Source: IMF, BIS
NBFCs Have Certain Structural Advantages and Disadvantages Vis-à-vis Banks…
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▪ 100 % foreign ownership permitted
▪ Ability to be nimble – lesser restrictions on branches, allowed businesses
▪ No obligation to lend to “priority” sectors or open branches in rural areas
▪ No requirement to maintain Cash Reserves/Statutory Liquidity
▪ Still very regulated – NBFC-ND SI1 as regulated as a bank
▪ Cannot offer liability products
▪ Higher capital adequacy ratios
▪ Higher cost of funding
NBFCs have over the years proved themselves to be nimbler and more specialized than traditional banks
1NBFC-NDSI are non-deposit taking NBFCs having total assets of greater than ₹ 500 Cr; which are classified as systemically important by the Reserve Bank of India
...Resulting in Significantly Higher Value Creation by NBFCs
16%
18%
4%
7%
9%
14%
-2%
-7%
-14%
-13%
11%
47%
3%
5%
3%
1%
15%
9%
19%
-20% 0% 20% 40% 60%
21%
23%
14%
12%
17%
28%
34%
3%
-6%
6%
19%
38%
25%
20%
16%
22%
33%
16%
18%
17%
12%
0%
3%
8%
13%
7%
2%
-51%
-23%
14%
22%
27%
18%
15%
17%
18%
17%
21%
-60% -40% -20% 0% 20% 40% 6
5-year AUM Growth (FY14-19) ROE (FY19) 5-year Annual Share Price Growth Rate
Mean: 23%
Mean: 15%
Mean: 19%
Mean: -1%
Mean: 13%
Mean: 3%
NB
FCs
Ban
ks
Public Sector Banks▪ ¾ of total credit▪ Limited by high NPA▪ Low CAAR (Basel-III)▪ High levels of
bureaucracy/ interference
NBFCs▪ Diversified geographical
presence ▪ Higher assessment
ability ▪ Limited by cost of funds
and capital investment
Private Banks▪ Increasing NPA▪ Limited Geo. reach▪ Limited assessment
ability as compared to a NBFC
• Constrained credit growth
• Structural issues
• Higher NPA
• Low rating and leverage
• Long term sustainable ROE is challenged
• Muted equity value creation.
• Healthy credit growth
• Current players are limited by credit availability, lower assessment ability & distribution reach.
• Pricing advantage & structural support available.
• Favorable demographics
• Increasing income
• Increasing debt appetite
• Faced with heavy price competition
• Needs strong capital base and a long gestation period
The NBFC Lending Market Can Be Broadly Divided Into Three Segments
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Consumer
SME
Corporate,Infra,
Real Estate
Current Scenario Future Projection
------
-
+++
+
+
--
Scalable business with attractive returnsLow gestation period
50 M
29%
560 B
MSMEs in India
Contribution to India’s GDP
Gross Value Add (US$)
US$300 B | SME Credit Gap
20.123.7
45.02.9 0.7
Banks NBFCs Otherinstitutions
Total FormalSupply
TotalAddressable
Demand
Bridging the $300B gap will need $60-70B in incremental equity capital | Growth isn’t a challenge for small business financiers!
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10% MSMEs with access to credit
Potential Addressable Credit Gap: ₹ 21.3 T growing at 7%+ per annum
Small Business Lending Isn’t a Small Business
₹ T
Difficult to understand businesses/cash flows
Fragmented set of customers
High dependence on the ecosystem
Lack of data
Challenges in lending to the SME segment…
High cost of customer acquisition
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?
…leading to a Frustrating Borrowing Experience for Small Businesses
Time consuming offline process
Non-tailored credit assessment
Rigid collateral requirements
Product mismatch
Traditional Lenders remain unfocused on SMEs due to Business Model Diversity
Traditional Lenders continue to find mid market and large corporate more rewarding – not necessarily true!!
Product
Customized products based on the nature of business, non-financial parameters, end use, payment
capacity/ frequency of underlying customer
Loans against property, supply chain financing, unsecured loans
Loans against property, supply chain financing
DistributionOmnichannel
Ecosystem based lendingBranch/DSA led Branch/DSA led
Credit AppraisalSector specific approach,
Cash Flow Based Automated Review
One size fits allCollateral/Bureau score
One size fits allCollateral/Bureau score
Turn-Around Time 4-5 days 15-20 days 30-45 days
Documentation
Combining traditional and non-traditional sources. Use of
information available in public and private domains. Digital document
submission
Financial Statements, P&L Account, Balance Sheets, Bank
Statements
Project Reports. Projected financials, Bank Statements.
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Specialized SME Lenders Traditional NBFCs Banks
Specialized SME Lenders are Better Positioned to Bridge the SME Credit Gap…
…a Trend Previously Witnessed in Consumer Finance
Specialists vs. Generalists | A comparison of value creation by select NBFCs over a 5-year period
On an average, specialized NBFCs have created long-term value for shareholders | These companies have leveraged their deep knowledge of their segments to generate faster AUM growth/better ROEs as compared to generalist NBFCs
AUM CAGR between FY14-19; ROE for FY1911
Stock returns scaled to 100
AUM Growth
ROE
3% 20% 9% 18% 12% 13%
NA 18% 13% 21% 19% 22%
Specialized NBFCS
10
68
139
333
351
511
08/14 08/15 08/16 08/17 08/18 08/19
Reliance Cap L&T Finance Magma Fincorp Cholamandalam Muthoot Manappuram
Technology is Essential to Achieve a Specialized Model at Scale
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OPERATIONS
CREDIT UNDERWRITING
COLLECTIONS
DISTRIBUTION
▪ Quick and easy integration with distribution partners
▪ Paperless login enabled by API integrations and OCR
▪ Lower turn-around time
▪ Faster product launches and process iterations
▪ Direct to customer interface and pre-approved programs
▪ Access and process the large trove of private and public data
▪ Centralize underwriting knowledge
▪ Customized scorecards
▪ Automate processes to reduce errors and increase throughput
▪ Access and analyze surrogate data
▪ Comprehensive notification/trigger mechanism for best-in-class
client servicing
▪ Banking integration for automated disbursement, deductions
▪ Digital self service and support
▪ Digital process enablers such as eSign, eKYC, eStamping
▪ Processing at scale
▪ Automated, analytics led early warning systems
▪ Cash less EMI collections
▪ Geo-tagging of customers
Technology has created a new breed of fin-tech lenders in India | Digital lending to increase 10-15 times by 2023, scaling up to~$100B in annual disbursements
| Better Assessment| Shorter TAT | Personalized
Customer Journeys |
U GRO Lies at the Intersection of Technology Focused and Specialized NBFCs…
Fintech PlatformsSpecialized NBFCs
Sector Specialization
Product Specialization
Geographical Specialization
Supply Chain Platforms
Digital Lenders
Off-Balance Sheet Lenders
U GRO intends to create a specialized, scalable platform optimized for end-to-end lending13
▪ Scale a challenge
▪ Restricted to niches
▪ Opex heavy models
▪ High credit costs
▪ Liability challenged
▪ Mostly loss making
…Leveraging the Best of Both Worlds to Create a Truly Scalable Lending Model
Traditional – Fin-Touch Alternative – Fin-Tech
Adopting a hybrid model comprising best practices of
traditional lenders and modern fin-tech companies
Traditional credit assessment models like CIBIL scores
Alternate credit assessment models leveraging analytics + publicly available data
Physical processes such as visits to customersLeverage technology to automate processes
thus reducing manual errors
Focus on collateral driven lending Unsecured credit solutions
Limited to term loans Variety of loan products
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The U GRO Incarnation
The Assimilation of Aspirations
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Our Mission
‘To Solve the Unsolved’
India’s $600B+SME Credit Availability Problem
16
U GRO Capital | Who We Are
Knowledge Technology
Large Institutional Capital₹920Cr (~$130M) Of Equity Raised
Strong Corporate GovernanceBoard Controlled, Management Run
Experienced Management Team250+ Years of Experience
A highly specialized, technology enabled small business lending
platform
Deep domain expertise of target segments to better understand the customer
A scalable, data driven approach to ensure
dissemination of knowledge
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26 years of experience in creating institutions across the financial services domain
Mr. Shachindra NathExecutive Chairman and Managing Director
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Lending Capital Markets Asset Management Insurance
SME LendingBuilt India’s 4th largest Non-Banking Finance business, focused on SMEs with a book size of over USD 2.3 billion
Housing FinanceStarted the housing finance arm focused on funding the affordable housing segment
Retail BrokingCreated a platform with over 1,350 points of presence across India
Wealth ManagementJV with Macquarie providing wealth management solutions to ultra HNI clients
Investment BankingMid-market focused institutional equities and investment banking platform with presence in 8 countries
Asset ManagementLargest alternative asset management out of India : Over $ 21 B of AUM with presence across the US, Europe, Asia and Africa
Marquee funds included Northgate, IBOF, Landmark Partners and Quadria Capital
Life InsuranceLife insurance JV with AEGON NV of the Netherlands
Health InsuranceOne of India’s first specialized health insurance companies
Key Exits: Sale of the life insurance stake to Aegon, sale of the mutual fund business to Invesco, sale of Northgate to TCP, sale of Landmark Partners to the management team
▪ Core pillar of Religare’ssuccessful growth journey
▪ 6-year stint as the Group-CEO of Religare Enterprise
▪ Transitioned the companyfrom an operating loss of~USD 80 million in 2013 toUSD 50 million of netprofitability in 2016
▪ Presented the “CEO of theYear” award at the AsiaBanking, Financial Services& Insurance ExcellenceAwards in August 2015
▪ Started his entrepreneurialjourney in 2016.
Founder With Experience Creating Institutions Across Financial Services…
Manish Agarwal
Chief Risk Officer
AUM Managed: ₹ 1,200 B
Sandeep Kakar
Chief Growth Officer
AUM Managed: ₹ 150 B
Rajni Khurana
Chief Human Resources Officer
AUM Managed: NA
Anuj Pandey
Chief Operating Officer
AUM Managed: ₹ 120 B
Kalpesh Ojha
Chief Financial Officer
Liability Raised: ₹ 700 B
J Sathiayan
Chief Business Officer
AUM Managed: ₹ 80 B
Abhijit Ghosh
Chief Executive Officer
AUM Managed: ₹ 180 B
164employee
count
Fully formed
team
4/5Rated
employees
Deep and large ESOP
pool
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…Supported by a Leadership Team With a Strong Track Record of Execution…
… and a Strong Second Layer Management Team
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Arun AroraFraud Control
Dhruv SuriCorp Channels
Irem Sayeed Product & Strategy
Makarand MandkePolicy
Anshuman TiwariCredit (Secured)
Nilesh AsherCollateral Management
Shelvin MathewsCredit (Unsecured)
Subrata DasAnalytics
Sudhakar MogeraBFSI Partnerships
Vivek SeshadriStrategy & IR
Sunit VakhariaTechnology
Sunil LotkeLegal and Compliance
Strong Corporate Governance Framework Enshrined in the Articles…
▪ High degree of regulatory oversight and transparency
▪ An institution created with a long-term view, designed
for continued operational efficiency
▪ Access to permanent capital
▪ Deloitte appointed as the statutory auditor and PWC
appointed as the internal auditor
▪ Independent directors to comprise majority for perpetuity
▪ Any shareholder holding >10% to qualify for a board seat
▪ Key committees to be headed by an independent member
with required credentials
▪ The majority of the NRC, ALCO and Audit Committees to
comprise of independent directors
▪ Any proposed loan >1% of net worth or to a related party to
require unanimous approval of ALCO and the Board
▪ Board approved multi-layer credit authority delegation
▪ Removal of key management (including CRO, CFO) to
require 3/4th board approval
▪ Any significant action by the Company to need 3/4th
approval of the Board
Special Resolution of Shareholders required for effecting any changes to the AoAPromoters/Management do not have unfettered rights to divert business strategy
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…Supervised by an Independent Board Comprising of Industry Luminaries
▪ Ex-Chairman, MCX, Ex-CIC, GoI, Ex-Director - SIDBI▪ Over 40 years with the Indian Administrative Services▪ Indian Administrative Services (Batch of 1973)▪ M.A., Utkal University, M.Sc., London School of Economics
▪ Ex – DMD, SIDBI, Board Member of Capital Small Finance Bank▪ Over 38 years with experience with SIDBI, UCO Bank and IDBI▪ PGDM from MDI▪ Currently a director with MUDRA, MFIN, NSCCL, Aye Finance,
member of the advisory committee at Ivy Cap and Lok Capital
▪ Board Member – ICRA, RBL Bank, Ex-Senior Partner, Deloitte▪ Over 30 years of experience with Deloitte, Vaish and Associates▪ CA from ICAI and a BA from Delhi University▪ Currently an independent director at ICRA, Shubham Housing, Indo
Ram Synthetics, Joyville Shaapoorji Housing
NK Maini - Chairman, Risk Management Committee
Satyananda Mishra - Chairman, CSR Committee
Ranjana Agarwal - Chairman, NRC Committee
Rajeev K. Agarwal - Chairman, Stakeholder Committee
▪ Ex-Whole Time Member, SEBI▪ Over 30 years with experience with SEBI, FMC, IRS▪ Indian Revenue Service (Batch of 1983)▪ B. Tech, IIT Roorkee
▪ Ex-CFO, Citi-India▪ Over 40 years of experience with Citi, CEAT, Tata▪ PGDM from IIM Kolkata and B. Tech from IIT Kharagpur▪ Advisor to EY, Independent Director at Trent, Cashpor
Microcredit, Kalyani Forge, India First Life Insurance
S. Karuppasamy - Chairman, Compliance Committee
▪ Ex-Executive Director, RBI▪ Over 40 years of experience with the RBI▪ PG Diploma in Bank Management, Indian Institute of Banking &
Finance, CAIIB (Honorary Fellow) & MA (Economics)▪ Currently a member of the RBI services board, and a director at
ARCIL and Vidharan (MFI)
Abhijit Sen - Chairman, Audit Committee
Independent Members of the Board
Specialization: Government Policies
Specialization: Credit, SME
Specialization: SEBI Regulations
Specialization: Finance Function
Specialization: RBI Regulations
Specialization: Audit, Tax
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Specialization: Retail Banking
▪ Ex-Head of Branch Banking, HDFC Bank, Board Member Equitas▪ Over 30 years of experience at HDFC Bank and ANZ Grindlays Bank▪ B. Com from St. Xavier’s College Calcutta, MBA from Texas Christian
University and CA from ICAI▪ Currently a member of the Equitas Small Finance Bank board
Navin Puri
Amit GuptaNewQuest
Non-Executive Directors
Manoj SehrawatADV
Kanak KapurPAG
Chetan GuptaSamena
Formation of Chokhani Securities Preferential Allotment Qualified Institutional Placement
Birth of U GRO Capital Preferential Allotment
1994: Formation of Chokhani1995: Listing on the BSE2004-Present: 14-year track-record of profitability
₹ 4,350 M raised from global privateequity firms - ADV Partners,NewQuest and IndGrowth
₹ 1,120 M raised from public marketfunds, insurance companies
Acquisition of Chokhani SecuritiesRevamp of the management teamDemerger of the lending business ofAsia Pragati approved – ₹ 1,750 M
₹ 1,920 M raised from large familyoffices / HNIs through a preferentialallotment of shares
19
94
-2
01
7
De
c 2
01
7
De
c 2
01
7
Au
g 2
01
8
Disbursements started in
January, 19
May
20
18
23
Private Equity Funds Public Market Funds Insurance Firms Family Offices
Chhattisgarh Investments
MK Ventures
Group family
Taparia family
Jaspal Bindra
Backed by Diverse and Marquee Shareholders
Our Journey Thus Far
GRO-Plus
GRO-Chain
GRO-Direct
GRO-Xstream24
26 31
80
108
187
276
422
515
575
647
702 753
Jan-19 Feb-19 Mar-19 Apr-19 May-19 Jun-19 Jul-19 Aug-19 Sep-19 Oct-19 Nov-19 Dec-19
First Term Loan from a
Small Finance Bank
First Securitization
deal
Traditional and BFSI Channels Activated
Ecosystem Channel
Activated
SBI Co-Lending
Partnership
Bank of Baroda Co-
Lending Partnership
D2C Channel Announced –
Dec 2019 Launch
Completion of Asia Pragati Demerger
Crossed $100M in Disbursals
Crossed $10M in Disbursals Crossed $50M
in Disbursals
AUM Growth (₹ Cr)
First Digital Partnership
Signed
First NCD Issuance
Reached 100 employees
Received A/A1 Rating from Acuite
ICICI Co-Lending
Partnership
Crossed $100M in
AUM
First Term Loan from a
General Bank
U GRO Tech Module Development
First Machinery
Loans Partnership
Achieved Profitability for Q3 FY20
25
Focus on sustainable growth and building long-term partnerships during the current period of challenging market conditions
Metric
BFSI Partners
Disbursals
Employees AUM
GRO Partners
Ecosystem Partners
Customers
Branches
Secured
Co-Origination Partners
₹1,073Cr9
₹753Cr
3
67%
311
7,512
15164
26
Where We Stand Now
Data as of 31 December 2019
Know More, Grow More
Sector based approach to specialization
26
27
Deep Analysis of Macro and Micro Economic Factors…
Reached Targeted 8 Sectors
Future business prospects
Size of lending opportunity
Relative competition
lending
Impact of regulatory developments
180+ Sectors
20 Sectors
Interest coverage
Asset Turnover
ratio
Demand supply gap & cyclicality in
demand
Impact of change in
technology
Working Capital Cycle
Revenue Growth
EBITDA Margins
Upgrade & downgrade
ratio
Median rating
Gearing
Sector specific government
policy
Environmental issues
Input risk
Criteria
27
Criteria
An 18-month process involving extensive study of macro and micro economic parameters carried out in conjunction with market experts like CRISIL
…to Arrive at a Set of 8 Sectors
Focus on SME clusters in India
~50% - Contribution of the 8 sectors to the overall SME lending market in India
Validated independently by CRIF, CRISIL and the company distribution and underwriting teams
Selected sectors aside from Auto Components have been relatively less affected by the economic slowdown
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Large lending opportunity
Lower impact of regulatory changes
Secular consumption driven growth
Low geographical concentration
Relatively less competition from
banks
Top 8 Sectors
Healthcare
Education
Chemicals
Food processing/
FMCG
Hospitality
Electrical equipment
and components
Auto components*
Light engineering
Halted disbursals to Auto Components sector
We Further Narrowed Down on Select Sub-sectors
Healthcare Education Chemicals
Food Processing/FMCG
HospitalityElectrical Equipment
and Components
Auto Components Light Engineering
Key sub-sectors: General nursing homes, eye clinics, dental clinics, diagnostic labs, radiology/pathology labs, pharma retailersKey clusters: NCR, Mumbai, Bengaluru, Hyderabad and Chennai
Key sub-sectors: Fine dining (standalone), QSRs, fine dining chains, manpower agencies, boutique hotels, guest housesKey clusters: NA
Key sub-sectors: K-12 schools, play schoolsKey clusters: NCR, Mumbai, Coimbatore, Chennai, Hyderabad and Pune
Key sub-sectors: Dyes and pigments, bulk and polymers, agrochemicalsKey clusters: Mumbai, NCR, Ahmedabad, Vadodara and Surat
Key sub-sectors: B2B, B2CKey clusters: NCR, Pune, Bengaluru, Chennai, Aurangabad and Rajkot
Key sub-sectors: Engine parts, drive transmission and steering parts, body and chassis, suspension and breaking parts, electrical parts, other equipment, tradersKey clusters: NCR, Mumbai, Kolkata, Hyderabad and Bengaluru
Key sub-sectors: Dairy and dairy products, non-alcoholic beverages,consumer foods, poultry, sea food, food and beverage tradersKey clusters: NCR, Mumbai, Chennai, Hyderabad and Pune
Key sub-sectors: Casting and forging, medical equipment and devices, pipes, process control instruments, tradersKey clusters: NCR, Chennai, Pune, Ludhiana, Bengaluru, Ahmedabad and Rajkot
29
Sub-sectors selected basis the contribution to the overall sector credit demand and risk profiles
India’s First Sectoral and Sub-sectoral Statistical and Expert Scorecards
30
A Seamless, Customized Customer Journey
31
File Flow for a Secured Loan
~8 segment specific statistical scorecards
Log-In
▪ Plug and play distribution module
▪ Machine learning based OCR software
Pre-defined Criteria Met?
Loan Approved Pre-approval checksQuarterly
Monitoring
Feedback Loop
▪ Defined ticket size, sectors, turn-over
▪ Geographical location▪ Borrowing history
~38 sub-segment specific
scorecards
▪ Legal Verification▪ Fraud Control Unit Check▪ Field Investigation▪ Valuation
Criteria1,000+ Parameters
evaluated
20+ Data Sources
Data Enrichment~Sub-sector Specific PD Templates
Statistical Scorecards
Expert Scorecards
In Principal Approval in 60
mins
Final Approval in 48 to 72 hours
Sub-sectorPolicies
Data and Analytics
Touch and Feel
Experience
Disbursement
Statement Analyzers
Utilization of Big Data to Arrive at U GRO’s Sectoral Scorecards
Default rate across score ranges
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3.45%
1.23%
0.75%
0.56%
0.40%
0.45%
0.26%
0.12%
0.08%
0.00%
718
751
798
823
846
871
907
980
1,341
1,500
‘Bad rates’ across intervals8M+
850
60%+
70%
U GRO Behavioral ScoreParameters per loan
Loan records
GINI coefficient
‘Bads’ eliminated by removal of bottom 20% by score
Look-alike based application scores for each of our 8
sectors
Ability to estimate risk enables the company to
move to a risk-based pricing model
U GRO has received the 2020 Finnoviti Award for Business Model Innovation for the Development of Sector-specific Scorecards
Supplemented by Industry First ‘Expert Scorecards’ for all Sub-sectors
Parameters Factors Case A Case B Case C
Facilityrelated
Vintage of the entity 20% 15% 10%
Doctor’s Experience 20% 15% 10%
Arrangement with pharmacy unit 30% 30% 40%
NABH accreditation 30% 40% 40%
Operational
Share of IPD revenues in overall nursing home revenue 15% 20% 20%
Share of insurances cases in overall IPD admissions 15% 20% 20%
Govt empanelled cases in overall insurance admissions 10% 10% 10%
Occupancy rate 30% 20% 20%
Revenue per occupied bed 30% 30% 30%
Financial
Operating margins 15% 15% 15%
Return on Capital Employed 20% 20% 20%
Interest coverage 30% 30% 30%
Asset turnover ratio 20% 20% 20%
Receivable days 15% 15% 15%
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Facility40%
Operational 40%
Financial20%
Case A: Less than 20 bedded nursing home
Facility30%
Operational 30%
Financial40%
Case B: 20-50 bedded nursing home
Facility20%
Operational 20%
Financial60%
Case C: 50-100 bedded nursing home
Sector: HealthcareSub Sector: Nursing Homes
▪ Combination of operating and
financial parameters
▪ Scorecards developed in
consultation with CRISIL market
experts
▪ Methodology
▪ 1,000+ personal interviews
across 9 locations
▪ Responses for over 50+ curated
questions for each sub-sector
Credit Risk – Supplemented by Enterprise Risk
34
Asset Liability Management
Liquidity equivalent to 6 months of liability and 2 months of advances to be maintained at all times
The one year bucket mis-match will be positive or equivalent to zero
Asset strategy influenced by liability strategy
Fraud Risk
Background/Fraud checks on all outsourcing partners, agencies and employees before onboarding
Seeding checks conducted regularly
Operational Risk
Standard operating procedures defined for all processes
End to end automation of processes to limit manual intervention
PORTFOLIO LEVEL RISK ENTERPRISE LEVEL RISK
Concentration
Secured loans to be ~70% of overall portfolio in FY20
Single sector concentration is capped at 25%, single geography is capped at 20%
The BFSI channel to be <20% of the overall portfolio in FY20
FCU Checks
An independent team with deep market expertise
Partnerships with multiple FCU agencies and Hunter
Property appraisal
Collateral specialist hired
2 valuation agencies appointed for loan disbursal > ₹ 1 Cr
FI verification
Personal visits by employees
Geo-tagging of customer location
End-to-end automation of FI initiation and completion
Early warning systems
Automated, analytics led, early warning systems basis proprietary rules framework incorporating social, sector, macro-economic feeds
Credit Process Enabled by Integrated Technology
35
An In-house Technology Platform that Enables Our Underwriting Process
36
Fintech-enabledFour Channels
CustomerAcquisition
CustomerOnboarding
360° view of the customer
Customer Management
Expert Scorecards
Early Warning Systems1
2
3
Bank/GST Statement Analyzer
Statistical Scorecards
ML-Enabled OCR
Distribution Module
LOS
LMS
Data Integrations
Fraud Control
8 sectoral statistical scorecards
38 sub-sectoral expert scorecards
25+ API integrations
Automated policy checks
Multiple industry firsts to enable a
60-minute in-principal approval
Completely seamless, paperless onboarding
Plug and Play Distribution Module
37
A Plug and Play Distribution
Module
GRO Partners BFSI Channel Corporates Customer
Customer ERPGRO App Partner LOS
A paperless, and seamless customer onboarding process
Multiple customer
touchpoints
GRO LOS
Data Enrichment Layer
No documents
needed
Customer Devices
Credit Evaluation
Authenticity Verification
Business Prominence
Collateral Valuation
OCR Technology with Machine Learning to Expedite Processing
38
150+Applications processed
80%+Savings in time to process
<5Central Ops resources
50+System coded validation
checks
100+Financial parameters stored per case
3,000+Pages machine-read
P&L Statement, Balance Sheet
7-10 pages ingested per income assessment instance
Extensive accounting checks on P/L and Balance sheet entries
Determines if OCR output needs curing or if repeat upload is needed
Based on Natural Language Processing and Machine Learning
System assisted curing window
Handles unstructured text semanticallyWork of over 1 day can be
compressed inside 60 mins
Ingestion Validation
Image Processing Curing
A Machine Learning Based OCR system
System capable of handling pdfs and scanned copies
Accordingly cases progress in the workflow
Integration with legacy software through RPA and APIs
Curing data used by ML engine for progressive improvement
Advanced Bank, GST and Bureau Analyzers to Size Up the Customer’s Cash Flows, Ability to Repay, Risk-Return Metrics and Estimate Loan Exposure
▪ ~ 100 different product variants basis bureau standard definitions classified into ROI/tenor buckets
▪ Product level ROI, tenor assumptions to compute obligations
▪ Product specific obligations computation encoded
▪ Process replicated for all financial applicants for footprint across both Commercial and Consumer bureaus
Category
Counterparty
State
Month
▪ 400+ data parameters
▪ Validate monthly sales, expenses, gross margins
▪ Insight into borrower's business network and concentration
▪ Digitization of sector identification
▪ State-wise break up providing information on operating markets
Overview
Aggregate
Transactions
Bounces
▪ Information related to bank statement analysis obtained from Perfios through an API integration customized to U GRO requirements
▪ Ability to validate business transaction trends (sales, expenses, margins), cheque bounce patterns, loan/EMI details, supplier & vendor identification and concentration
Bank Statement Analysis Bureau Record Analysis
GST Statement Analysis
39
Tradelines
Granular Details
▪ OFAC▪ Interpol (Red and Yellow Notices)▪ UN Sanctions and Wanted Lists▪ Development Bank Blacklists
(World Bank, ADB, KfW, AFDB)▪ NIA Terrorist Lists▪ Wanted List under COFEPOSA
AML
LOS▪ Case logged in through another
channel for same product▪ Rejected in last 6 months due to
default/ fraud
LMS▪ Automated existing customer
check▪ In case of duplication, good-bad
logic is run – checking bounces/ defaults in last 3 months
▪ Group exposure▪ Family exposure
Internal De-dupe
Comprehensive de-dupe including internal LMS de-dupe, AML, litigation search covering BIFR, NCLT, all district courts, high courts, supreme courts, DRT, DRAT, ITAT
BIFR
▪ Array of BIFR Cases▪ Status of the BIFR Case▪ Name of the Entity▪ BIFR Case Number / Year ▪ Address of the Entity▪ Last date of Order
NCLT
▪ Name of Advocate▪ Status of Case▪ Names of all parties ▪ Interim Orders▪ Date of Order▪ Order/Judgement
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Comprehensive de-dupe including internal LMS de-dupe, AML, litigation search covering BIFR, NCLT, all district courts, high courts, supreme courts, DRT, DRAT, ITAT
Courts and Tribunals
▪ Access to court records of Indian District, High and Supreme Courts
▪ API Integration through eCourtsServices
▪ Comprehensive checks against database of 900,000+ cases
Fraud Checks and Litigation
Automated Policy Approvals Reducing Subjectivity in Credit Appraisal
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| Highly flexible | Capable of handling complex computations and policies |
Automated comparison to policy
Computation of loan amount
and ROI
Machine learning based credit systems
Industry leading TAT and
productivity
No manual errors
Auto-escalation to relevant authorities
Parallel processing against
all policies to capture best fit
Large and Scalable Distribution Platform Enabled by Technology
42
43
Development of System Architecture for Full-Suite SME Lending
GRO-ProtectCore Engine
GRO-Xstream
Partnerships
Core LMSSystem of Records
GRO-Direct
Direct Interface
GRO-Chain
Supply Chain
GRO-Plus
Intermediaries
Anchor
Buyers
Suppliers
Banks/FIs/DFIs
Insurance/Mutual Funds/HNIs
NBFCs/Fintechs
An uberized distribution model capable of
onboarding DSAs, CAs and other intermediaries
Direct to customer (Online) channel – went live in beta phase in December 2019
Supply chain financing platform for vendor and
dealer/distributor financing
An online marketplace for large banks to partner with smaller NBFCs to either co-
originate or purchase assets
A comprehensive set of modules that will allow for maximal lending outreach within our mandate
Four Distribution Channels that Drive Our Asset Engine
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▪ 311 intermediary GRO-Partners onboarded in 9branches across key SME clusters in India
▪ Facilitated by our proprietary GRO-Plus app, anUberized distribution model which enables GROPartners and allows Principle Approval within one hour
▪ U GRO’s BDMs achieve industry leading productivitiesand TATs through our tech-enabled approach
Traditional Channel | GRO-Plus
▪ Our Ecosystem Channel involves partnering withAnchor companies, to gain access to their base ofvendors for invoice-backed supply chain financing
▪ This model allows for credit provision to reach dealers,distributors and tier 2 suppliers who are not eligible fortraditional financing
▪ Development ongoing of GRO-Chain, an SCF platformfor vendor and dealer/distributor financing
Ecosystem Channel | GRO-Chain
▪ Partnerships spanning co-lending, onward lending andsecuritization. We have partnered with 26 BFSIs, withan emphasis on serving ‘bottom of the pyramid’ SMEs
▪ Driven by GRO-Xstream, an industry-first onlinemarketplace for large banks to partner with smallerNBFCs to either co-originate or purchase assets
BFSI Partner Channel | GRO-XStream
▪ Our proprietary Digital Lending Platform GRO-Directaims to allow SMEs to directly apply for credit,increasing borrowing ease and further reducing TATs
▪ Digital partnerships signed with several fintechmarketplaces, service providers and aggregators
Direct Digital Channel | GRO-Direct
U GRO’s distribution model is geared towards catering SMEs across all geographies and ticket sizes. We create tailored products which allow for highly structured deployment of capital – optimized for both the distribution channel and customer
Turnover: Up to ₹5 CrTicket Size: Up to ₹2 Cr
Turnover: Up to ₹1 CrTicket Size: Up to ₹50 L
Turnover: Up to ₹20 CrTicket Size: Up to ₹5 Cr
Turnover: Up to ₹50 CrTicket Size: Up to ₹5 Cr
Traditional Channels | A New Approach to the Old…
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▪ Rigorous vetting of 1,200+ partnersto reach an initial list of 100 channel partners.
▪ Selection criteria:
₋ Track-record of 3+ years
₋ Infrastructure Readiness
₋ Portfolio performance
▪ Partners have a track-record of acquiring $700M+ per month
▪ Channel partners pay an onboarding fee – a first in the industry
Delhi
Jaipur
Hyderabad
Bangalore
Ahmedabad
Kolkata
Mumbai
Chennai
Branch Offices
Head Office
Locations identified through SME cluster analysis
and portfolio benchmarking
Partner Selection Criteria Partner App: An Industry First
Vijaywada
Coimbatore
Pune
NashikNagpur
Rajkot
VapiSurat
Baroda
Jodhpur
Indore
LudhianaChandigarh
Planned Branches
Value Proposition for Channel Partners
▪ Lower TAT : In principal approval in 1 hour
▪ Higher productivity: High conversion (~60%) post the in-principle approval
▪ Analytics-driven opportunity to cross-sell/top-up within their customer bases
▪ U GRO co-lends with larger banks, allowing partners to originate larger ticket sizes
▪ Payment within 7 days resulting in improved working capital management
…Leading to Higher Productivity Across the Value Chain
Traditional Model U GRO Model
Customer Journey
▪ Needs to fill lengthy forms, submit multiple documents to 7-10 NBFCs, wait 6-10 days for an in principal approval and then 30 days for a final approval post multiple rounds of follow-ups
▪ In-principal approval in 60 mins by submitting only the GST/PAN details, and financials to the DSA
▪ Post submission, disbursal in 4-5 days for 60-70 percent of cases
Partner Universe ▪ Mainly Direct Sales Agents▪ DSAs, Chartered accountants, Mutual
Fund/Insurance brokers
Turn-around time▪ Channel Onboarding: 1 week▪ Loan Onboarding: 30-45 days
▪ Channel Onboarding: 1 day▪ Loan Onboarding: 1 hour in-principal approval; 4-
5 days for disbursement
Role of a branch sales manager▪ Co-ordinating with the credit team, collecting
documents, relationship management▪ Managing relationships with the customer, and
the channel partner
FOS productivity▪ 2 secured files/month▪ 4-5 unsecured files/month
▪ 5-6 secured files/month▪ 9-10 unsecured files/month
Credit productivity▪ Manual CAM preparation, review of every logged
in file▪ Automated CAM, trigger-based review
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Disrupting the traditional branch led model through technology
Partnership with a smart energy solutions platform
▪ Pre-approved program based on data analytics for unsecured & secured loans to energy product vendors
▪ Performance data of vendor partners with U GRO to be shared by the aggregator
— Vintage, location, transaction history
▪ Pay-outs to vendors routed through an escrow account created for the program
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Independent vertical headed by the Chief Growth Officer
▪ Each sector to be led by a ‘sector head’
Develop partnerships in prioritized segments with key participants e.g. sector
specific lenders, industry bodies
▪ E.g. Anchor led supply chain financing, partnerships with equipment
suppliers
Dedicated “Growth Team” to build industry partnerships
Ability to go deep into the partner value chain
Hotel Franchisor(Anchor)
Receivable financing to their partner
ecosystem
Cross-sell of other products to the
franchisees
Ability to tap into the end consumer by providing travel
loans
Ability to tap into the partners’ network of distributors, dealers, suppliers and then eventually the end customer through an ecosystem-based lending strategy
Growth Channels | Ecosystem Based Lending
BFSI Partnership Channels | Ability to service the bottom of the pyramid
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Symbiotic partnerships to cater to the MEL segment
Challenges faced by NBFCs:
▪ Given scale of NBFCs, their regional concentration and the target segment, access to credit for such NBFCs is limited
U GRO Solution:
▪ Create a steady liability solution for such NBFCs through multiple modes including direct lending, on tap assignment, co-lending and debt syndication
▪ Joint under-writing by U GRO and the partner NBFC
Advantage to U GRO
▪ Ability to create a large, granular micro-enterprise book without incurring significant opex
▪ First loss credit enhancement from the NBFC
The BFSI partnership channel is U GRO’s strategy to cater to the micro-enterprise segment without incurring high Opex costs
Large Corporates
Small and Medium
Enterprises
Micro Enterprises
U GRO target segment
Mainly located in large SME customers in metros/Tier 1
cities
Catered to by smaller regional NBFCs
Needs heavy investments in branches/feet on street
especially in Tier 2/3 cities
Mainly catered to by large banks
Ticket size > $7M
Our Innovation-Driven Digital Lending Platform
Product Development▪ Sectoral Need Gap
Identification based on Perception Maps
▪ E.g. Solutions available for Dentists Loan (Healthcare → Doctors) & Kirana Shop Loans (FMCG → Trading)
Marketing▪ Customer Data Identification▪ Push & Pull Marketing
Campaigns▪ Personalised Communication▪ Personalised on-boarding
journey (ChatBots)
Product and MarketingInnovation driven by Micro-Level
Focus within Sub-sectors
Sector-Focused Partnerships▪ Ecosystem Players▪ Aggregators▪ Web Portals Listings▪ Payment Gateways▪ Marketplaces▪ Industry Bodies/Associations
Direct To Customer Campaigns▪ Integrated Marketing Automation
Tool for campaign delpoyment▪ Medium: SMS/Flash Message
/WhatsApp/Voice Blasts/Email ▪ Outbound Calling with loan
solutions to optimise conversion
AcquisitionMicro–targeting of customer andpartner audiences for onboarding
▪ Based on Industry First Sector Specific Scorecards
▪ Pings other Tech Platforms for information gathering and validation via customized APIs
▪ Assisted models (Outbound Calling) to induce customers to convert
▪ Outsourced partners to collect documents and meet regulatory compliance
Underwriting/Fulfilment60 Mins Decisioning – 100% Digital
▪ Completely Digital Customer Servicing▪ No reliance on human interrvation ▪ Web-service based APIs for instant
query/request handing over app/web or IVR call
Customer ServiceChatbot based, integrated with
popular message apps (proposed)
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Launched in Dec 2019
Distribution Network
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Branches
BFSI Partners
GRO Partners
Ecosystem Partners
Co-lending Partners
9
26
311
21
3
20
45-50
800-1000
50-60
10-15
Current FY24P
Deep Sectoral Understanding
Leading to Tailor-made Product Solutions
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Our Product Philosophy
To create sub-sector specific products by modulating the following attributes to meet customer requirements…
Loan Structuring
Collateral TenorAssessment Parameters
Pricing
Moving beyond conventional products offered by most NBFCs in the market…
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Supply Chain Financing
Unsecured LoansSecured Loans
Mostly long tenor, loan against property
Short term working capital loans
30-90 day loans against invoices
A Holistic Product Solution…
PricingRate of Interest / Processing Fee
Methods of assessment| Financial |Banking | Turnover |
CollateralMovable/ Immovable
Property
TenorRepayment Frequency/
Repayment Period3
Sector based product
parameters
Loan structuringAbility to offer structured disbursement
and repayment solutions
Scenario: Hospitality/restaurants; franchise set up▪ 1st disbursal – transferred to master franchisee account –
repayment to start post 6 months▪ 2nd disbursal –for infrastructure development – repayment
post 6 months▪ 3rd Disbursal – as the first disbursal as a line of credit, valid for
12 months, quarterly bullet repayments
Scenario: Healthcare Retailers▪ Data on prospective borrower is provided by super distributor ▪ Includes monthly / yearly procurement and payment pattern
Sales and recovery report from the supplier / super distributor taken as document proofs
Scenario: Education▪ Repayment frequency to match the frequency of fee receipt ▪ If the fee is received once in a quarter, the EMI frequency can
also be structured accordingly
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Scenario: Education Industry▪ Future fee receivables as primary collateral ▪ Institution building as the secondary collateral
Scenario: Type of collateral▪ ROI to vary basis collateral▪ Self occupied residential property to have lower ROI as
compared to vacant residential properties▪ K12 / Hospital buildings to have higher ROIs
…With Tailored Products for Each Sub-Sector
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Sector Sub-sector Key Insights
Boutique Hotels
▪ Boutique hotels want a convenient and hassle-free loan process
▪ Business data available on digital marketplaces
▪ Very open to completely digital process
Hospitality
Healthcare
Food Processing& FMCG
Dental Clinics
FMCG Traders
Key PropositionsTarget Segment
Two/three star mid sized and budget hotels
Restaurants and QSRsQuick service
restaurants and fine dining restaurants
▪ Restaurants with different formats have highly disparate sources of income
▪ Broad range of margins across sub-types, affected in particular by owning a liquor license
▪ Pre-approved loan disbursement based on marketplace data e.g. trivago, MakeMyTrip etc.
▪ Parameters for loan decision include online rating, # of rooms, average room rate etc.
▪ Restaurant format-based eligibility approach -QSR standalone, QSR franchise and fine dining
▪ Scorecard approach with higher scores for owned property, liquor license, home delivery
Existing dental clinics
▪ Loan eligibility in this sector is quite margin reliant
▪ Dental clinics offering high end, very specialized services have higher margins
▪ Procedure based lending approach
▪ Liquid Income program available based on specialization of the dentist
▪ Parameters for loan decision include doctor’s qualifications, clinic vintage etc.
Kirana shops measuring a minimum of 200 sq. ft
▪ Outlook and repayment behavior have a strong correlation with shop size and business vintage
▪ Volume is very dependent on speed at which they can rotate stock
▪ Business and sourcing stability are also of critical importance
▪ Loans offered based mainly on floor area and business/shop vintage
▪ Further parameters monitored include supplier stability, quantity of stock maintained, inventory turnover etc.
Leading to a Portfolio that Caters to the Needs of a Diverse Set of Liability Providers
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Liability is an ‘Art’ – U GRO is designed to perfect this Art..
Liability led asset strategy
▪ Build a diversified, granular book catering to prime/near prime customers
▪ Start with a primarily secured book and slowly build the unsecured part
▪ 95% of the book to be Priority sector/Impact lending
▪ Minimal asset-liability mismatch
Diversified Liability Base
▪ Diverse liability mix to include – all major banks, debentures, capital market and insurance companies
▪ Access funding from new sources of funding such as multilateral agencies, impact funds, development bank etc.
▪ A mix of on and off-balance sheet assets
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Active engagement with stakeholders
▪ Enhance ratings through close partnerships with rating agencies and by creating a diverse and secure lending book
▪ Early conversations with banks to secure debt and co-lending partnerships
| Build loan book starting from high equity/low leverage to higher leverage over a period of time | Achieve low cost of borrowing basis high credit rating over a period of time |
U GRO’s asset strategy would lead to a low cost of capital
Key tenets of our liability strategy
Our Liability Strategy | A Tri-Pronged Approach
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U GRO PlatformKnowledge | Technology
U GRO Capital Larger Banks/NBFCs
Balance-sheet Co-origination
Insurance Firms/Mutual Funds
Assignment
| Ability to generate significant fee income | More competitive interest rates | Ability to cater to customers of all risk profiles | Increased scale | Minimize ALM mismatch |
Partnerships already signed with SBI, ICICI Bank and Bank of Baroda
Specialized programs for DFIs/multi-lateral organizations
Policy of actively securitizing the loan book to ensure that the mismatch in the greater than 5-year bucket is funded by
equity
Co-origination with larger banks to originate higher
ticket loans
Healthcare, education, female entrepreneurs, clean energy
Co-origination Partnerships with Three of the Largest Banks in India
Bank of Baroda(Loan Book: $67B)Secured Business Loans Signed October 5, 2019
State Bank of India(Loan Book: $312B)
Small Ticket SBL & UBL Signed November 8, 2019
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ICICI Bank(Loan Book: $84B)Secured Business Loans Signed December 13, 2019
Co-origination is a value accretive strategy
Customer pays a single blended rate of 12%
The Co-lending bank receives 80% of the loan
at an ROI of 10.5%
U GRO receives 20% of the loan at an ROI
of 12%
U GRO also receives the differential
between the ROI received on the 80% of the loan and the bank rate as a fee
(i.e. 1.5% on the 80%)
Numbers provided are for illustrative purposes only
▪ U GRO achieves a high total income per loan with this model, leading to a higher ROE▪ Co-origination provides a channel for quasi-liability at an attractive cost of debt▪ U GRO’s income from 80% of the loan is classified as fee income, for which there are no
capital adequacy requirements▪ The full responsibility for origination, underwriting and collections (if required) lie with U
GRO Capital▪ Co-lending model allows U GRO to better cater to varying risk classes
Example of Co-origination Model
Sustained and Controlled Early Growth
59
60
Progression of Growth Metrics
82
300
702
1,073
FY19 Q1 FY20 Q2 FY20 Q3 FY20
Total Disbursals (₹ Cr)
80
276
575
753
FY19 Q1 FY20 Q2 FY20 Q3 FY20
AUM (₹ Cr)
49525
6,395
7,487
FY19 Q1 FY20 Q2 FY20 Q3 FY20
Number of Customers
76
131
232
311
FY19 Q1 FY20 Q2 FY20 Q3 FY20
GRO Partners
3
11
15
21
FY19 Q1 FY20 Q2 FY20 Q3 FY20
Ecosystem Partners
10
19 19
26
Q4 FY19 Q1 FY20 Q2 FY20 Q3 FY20
BFSI Partners
61
16%
18%
10%
15%
17%
10%
9%5%
Sectoral Mix*
Electrical Equipment
Education
Food Processing
Hospitality
Light Engineering
Auto Components
Chemicals
Healthcare
Portfolio Snapshot (As on Dec 31, 2019)Geographical Mix*
*Includes Traditional and Ecosystem Channels
▪ Delhi/NCR▪ Karnataka▪ Gujarat▪ Telangana▪ Maharashtra▪ Rajasthan▪ West Bengal▪ Tamil Nadu▪ Haryana▪ Uttar Pradesh▪ Punjab▪ Chhattisgarh
21%
12%
7%
8%
14%9%
8%
9%
1%
1%
5%
3%
67%
33%
Secured Mix
Secured
Unsecured
Well diversified by geography and sector | Majority secured book, with unsecured running down faster through end FY20
Presence in 100+ cities across India
Balance Sheet
▪ Remain liquid with ₹277 crores of
immediate liquidity on the balance sheet
▪ ₹66 crores obtained from the conversion
of warrants in Q3
▪ CRAR: 88.9%
▪ GNPA: 0.07%
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Balance Sheet (₹ Lakhs) Q3 FY20 Q2 FY20
Financial Assets 106,436 91,682
Loans 74,722* 56,729
Cash and Investments 23,317 29,310
Other Financial Assets 8,398 5,643
Non-Financial Assets 4,941 4,882
Total Assets 111,377 96,564
Financial Liabilities 20,942 13,434
Trade/Other Payables 905 825
Borrowings & Debt Securities 16,690 9,359
Other Financial Liabilities 3,347 3,251
Non-Financial Liabilities 364 397
Total Equity 90,071 82,733
Equity Share Capital 7,053 5,690
Other Equity 83,018 77,043
Total Liabilities + Equity 111,377 96,564
*AUM as of Q3 is ₹753Cr, the ‘Loans’ figure adjusts for net payouts and ECL as per Ind-AS
Income Statement
63Ind-AS accounting standards have been in place since Q1 FY20
Income Statement (₹ Lakhs) Q3 FY20 Q2 FY20 QoQ Q3 FY19 YoY
Interest Income 2,389 1,517 57.5% 1,014 135.6%
Other Operating Income 501 649 -22.8% 599 -16.4%
Less: Financing Costs 523 116 350.8% 39 NA
Net Income 2,366 2,050 15.4% 1,574 50.3%
Operating Expenses 1,683 2,410 -30.1% 1,238 35.9%
Provision 104 250 -58.4% 2 NA
Profit Before Tax 579 (611) NA 334 73.3%
PBT after Exceptional Items 579 (347) NA 334 73.3%
Less: Tax (110) (22) NA (19) NA
Profit/(Loss) for the period 689 (325) NA 353 95.1%
Other Comprehensive Income (Net
of Tax)(6) 3 NA - NA
Total Comprehensive Income 683 (322) NA 353 93.4%
▪ Operating income has increased as a result of
expansion of loan book
▪ The reduction in operating expenses as
compared to Q2 FY20 is primarily due to us
having previously incurred one-time expenses
that were not present in Q3