MOTILALOFS

January 24, 2024 To BSE Limited National Stock Exchange of India Limited P. J. Towers, Exchange Plaza, Plot No. C/1, G Block, Dalal Street, Fort, Bandra-Kurla Complex, Bandra (E), Mumbai - 400001 Mumbai - 400051 Security Code: 532892 Symbol: MOTILALOFS Sub.: Investor(s)/Analyst(s) Presentation – Financial Performance for Q3 FY 2023-24 Dear Sir/Madam, This is with reference to our earlier letter dated January 19, 2024 regarding Earnings Conference Call with Institutional Investor(s)/Analyst(s) for discussing Q3 FY 2023-24 Financial Performance of the Company. In this regard, please find enclosed herewith the Presentation to be made to Investor(s)/Analyst(s). The said Presentation will be uploaded on the Company’s website at www.motilaloswalgroup.com. Further, the Audio recording & transcript of earning con-call will be made available on the Company’s Website i.e. www.motilaloswalgroup.com. Kindly take the same on record. Thanking you, Yours faithfully, For Motilal Oswal Financial Services Limited Kailash Purohit Company Secretary & Compliance Officer Encl.: As above Earnings Presentation Q3F Y 24 & 9MF Y 24 BUSINESSES FOCUS ON SUSTAINABLE ALL BIZ OFFER HUGE BUILDING SCALE GROWTH HEADROOM FOR GROWTH GDP during Amrit Kaal to reach $30tn mark Gross Domestic Product ($ Tn) 30.0 27.4 25.0 22.9 20.9 19.1 17.4 15.9 14.5 13.3 12.1 11.1 10.1 9.2 8.4 7.7 7.0 6.4 5.9 5.4 4.9 4.5 4.1 3.7 3.2 3.4 2.7 2.7 2.8 2.7 2.0 2.1 2.3 3 Source: As per internal estimate KEY HIGHLIGHTS FINANCIALS BUSINESSES Well positioned for the USD 100+ tn savings opportunity Gross Domestic Savings (USD tn) 9 . 9 0 . 9 2 . 8 5 . 7 9 . 6 3 . 6 7 . 5 2 . 85 . 44 . 04 6. 4 3. 3 0. 3 8. 3 5. 3. 2 1.2 1 . 0 1 . 0 1 . 0 1 . 0 1 . 0 1 . 0 1 . 0 2 . 0 2 . 0 3 . 0 3 . 0 5 . 0 4 . 0 5 . 0 6 . 0 6 . 0 6 . 0 6 . 0 7 . 0 7 . 0 7 . 0 9 . 0 9 . 0 8 . 0 8 . 0 9 . 0 0 . 1 1 . 1 2 . 1 3 . 1 5 . 1 6 . 1 8 . 1 9 . 1 . 2 2 7 9 1 3 5 7 9 1 3 5 7 9 1 3 5 7 9 1 3 5 7 9 1 3 5 7 9 9 0 0 0 0 0 1 1 1 1 1 2 2 2 2 2 3 3 3 3 3 4 4 4 4 Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y Y F F F F F F F F F F F F F F F F F F F F F F F F F F Source: MotilalOswalWealth Creation Study 4 KEY HIGHLIGHTS FINANCIALS BUSINESSES Decadal strong growth, Next decade equally exciting Demat Account grown at 20% CAGR in last 10 years (in Mn.) Retail ADTO grown at 63% CAGR in last 10 years (₹ tn ) 0 Monthly addition . 2 4.5 160 1 1 4.0 Total (RHS) 140 3.5 120 1 . 3.0 1 100 6 2.5 80 7 . 2.0 9 60 7 2 1 1 . . 0 5 40 6 . 0 7 . 0 1 . 1 1 . 1 8 . 1 1 . 3 9 . 4 9 . 6 . 1 1 0.5 20 0.0 0 3 4 5 6 7 8 9 0 1 2 3 4 1 1 1 1 1 1 1 2 2 2 2 2 Y Y Y Y Y Y Y Y Y Y Y Y F F F F F F F F F F F F M 9 SIP flows on a relentless rise, making the markets resilient – grown at 24% CAGR in last 7 years Dec-2023 ₹ 176bn Mar-2020 ₹ 86 bn Dec-2016 ₹ 39 bn 6 7 7 7 8 8 8 9 9 9 0 0 0 1 1 1 2 2 2 3 3 3 1 1 1 1 1 1 1 1 1 1 2 2 2 2 2 2 2 2 2 2 2 2 - - - - - - - - - - - - - - - - - - - - - - c r g c r g c r g c r g c r g c r g c r g c e p u e p u e p u e p u e p u e p u e p u e 5 D A A D A A D A A D A A D A A D A A D A A D KEY HIGHLIGHTS FINANCIALS BUSINESSES Financialization of Savings propelling equities % of Household Assets in Equities Total Indian Household assets $ 11.1 Tn (FY23) 4.8 4.7% 4.7 50.7% 4.3 3.4% 3.9 3.8 5.8% 5.9% 3.4 15.5% 14.0% 2.9 2.7 2.7 Equities Cash Provident & Pension funds Insurance funds 2.2 2.2 Bank deposits Gold Property FY13 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 In USA, share of equity in household assets is at ~45% vs India it is just 4.7% 6 Source –Jefferies Report 2023 KEY HIGHLIGHTS FINANCIALS BUSINESSES 36-year brand MOFSL awarded ‘Brand of the Year’at the CNBC TV18 - India Business Leadership Awards 2018 MOFSL was featured in ‘Fortune 500 (India)’ in 2017, 2019, 2020, 2021, and 2022 MOFSL gets featured in ‘Forbes Super 50 Companies’2017 & 2018 MOFSL gets listed in ‘Fortune 500 India’s Largest Corporations’in 2018 MOFSL gets inducted in the ‘HALL OF FAME’ at the CNBC 10th Financial Advisor Awards 2019 MOFSL certified as ‘Great Place to Work’ by GPTW® - INDIA continues for 6 years 7 KEY HIGHLIGHTS FINANCIALS BUSINESSES Double Engine Model – Operating Business+Active Investments Book Investments are used strategically Engine #1 Engine #2 for operating businesses OPERATING BUSINESSES TREASURY INVESTMENTS Synergy • Asset light businesses • Skin in the game + • Diversified revenue streams • Highly liquid Liquidity • Each business is run by + • Healthy returns separate CEO Stability Operating profit post dividend payout invested 8 KEY HIGHLIGHTS FINANCIALS BUSINESSES Engine #1 – Operating Business PAT ₹ Mn 791 1,191 981 3,114 3,486 2,486 3,983 4,706 8,264 8,835 8,420 # FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 9MFY24 All nos. are excluding carry income 9 #FY19 PAT is lower mainly on account loss in housing finance (HFC) business of ₹ 132 crdue to one time higher provisions. Excluding HFC loss PAT is ₹ 381 cr KEY HIGHLIGHTS FINANCIALS BUSINESSES Total PAT (incl. OCI) Operating PAT Treasury Investments PAT (incl. OCI) ₹ Mn 19,994 15,523 8,420 12,595 4,706 8,822 8,264 6,623 3,486 1,235 3,600 8,835 2,836 1,436 1,691 3,114 3,983 771 1,191 2,486 981 486 3,137 10,817 4,331 11,574 791 245 710 -13 350 -20 -2,748 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 9MFY24 10 KEY HIGHLIGHTS FINANCIALS BUSINESSES Engine #2- Treasury Investment Book ₹ Bn 58.7 43.3 40.9 31.3 17.4 17.9 17.5 11.3 9.9 7.3 1.6 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 Dec-23 11 KEY HIGHLIGHTS FINANCIALS BUSINESSES Highly professionalised structure RAAMDEO AGRAWAL MOTILAL OSWAL NAVIN AGARWAL AJAY MENON RAJAT RAJGARHIA ABHIJIT TARE CHAIRMAN MD & CEO MD & CEO –ASSET CEO – RETAIL BROKING CEO – INSTITUTIONAL CEO – INVESTMENT MANAGEMENT AND DISTRIBUTION EQUITIES BANKING A CA by qualification, Mr. A CA by qualification, Mr. Oswal Mr. Agarwal is a CA, ICWA, Mr. Menon is a CA by Mr. Rajgharhiais a CA and MBA Mr. Tare brings with him over Agarwal started MOFSL along started MOFSL along with Co- CS and CFA by qualification. qualification. He possesses over by qualification. He joined 26 years of rich experience in with Mr. Motilal Oswalin 1987. promoter, Mr. Raamdeo He was responsible for the 24 years of experience in MOFSL in 2001 as a Research Institutional Equities and He is Chairman of MOFSL. A Agrawal in 1987. He has served Institutional Broking & Capital Markets. He joined the Analyst, went on to Head the Investment Banking. He is a CA keen believer and practitioner on the Boards of the BSE, Indian Investment Banking business Group in 1998. He is also a Research team, and currently by qualification. He has worked of the QGLP philosophy, his Merchant’s Chamber (IMC), and and has been instrumental in Whole time Director of MOFSL. heads the Institutional Equities with TAIB Securities and HRS wealth creation insights and on various committees of the building a market-leading business. Insight. He joined MOFSL Group decades-rich experience have BSE, NSE, SEBI and CDSL. position for the Group in in 2004. played a pivotal role in the Institutional Broking. He has growth of MOFSL. been with MOFSL since 2000. VISHAL TULSYAN SUKESH BHOWAL ASHISH SHANKER SHALIBHADRA SHAH PANKAJ PUROHIT NIREN SRIVASTAVA CEO – PRIVATE EQUITY CEO-HOUSING FINANCE CEO-WEALTH MANAGEMENT CHIEF FINANCIAL OFFICER HEAD- INFORMATION CHIEF HUMAN RESOURCE TECHNOLOGY OFFICER Mr. Tulsyanis a CA (all-India Mr. Sukesh has 27 years of Mr. Shanker is an alumni of Mr. Shah is a CA by qualification. Mr. Purohit has done Bachelor in Mr. Srivastava is a Postgraduate rank holder). He has more than experience in Sales & Harvard Business School and has He is a Finance professional with Engineering and has more than in HR and has completed his 16 years of experience in Distribution, Retail & Mortgage 25 years of experience. He joined 18 years of experience spanning 26 years of experience. He is a graduation in Political Science Financial Services. He has Lending, Real Estate Lending MOPWM as Head-Investment the entire gamut of Finance, seasoned IT leader who has led and Sociology. He has more than worked with Rabobank as a etc. He has worked with DCB Advisory in 2012 and was Accounts, Taxation & large IT teams in various vertical 17 years of experience. He Director. He joined MOFSL in Bank, HDB Financial Services, instrumental in building the Compliance He joined MOFSL in the financial space. He joined joined MOFSL Group in 2023 and 2006 and is the founder MD& Citibank and HSBC. He is research and advisory platform. Group in 2006. MOFSL Group in 2004. was previously associated with CEO, of Motilal Oswal BachelorofTechnologyfromIIT Prior to joining MOPWM, he was Aditya Birla Group. Alternates. BombayandPGDMinFinance& associated with HSBC and SCB. MarketingfromIIMLucknow 12 Robust business infrastructure & network R O B U Distribution Network Geographical Reach S 9,300+ Franchisee 2,500+ Business Location T 20,000+ IFAs 98% of PIN codes covered Motilal Oswal Tower - Mumbai I N F R Clients A ~60,00,000 S Motilal Oswal Tower - Ahmedabad T R U C T Employees Advisors & Research Team U 10,000+ 2,500+ Advisors 100+ Research Team R E Motilal Oswal Tower - Bangalore 13 KEY HIGHLIGHTS FINANCIALS BUSINESSES Research & Advisory Powerhouse Institutional Equities Wealth Retail Management Broking 100+ Research Team & 2,500+ Advisors Alternative Asset Asset Management Management Investment Banking 14 KEY HIGHLIGHTS FINANCIALS BUSINESSES Group Structure MOFSL Group Capital Markets Asset and Wealth Management Housing Finance Asset Private Broking & Institutional Investment Wealth Management Equity & Distribution Equities Banking Management Company Real Estate Motilal Oswal Motilal Oswal Motilal Oswal Asset Motilal Oswal Motilal Oswal Financial Alternate Investment Motilal Oswal Home Investment Advisors Management Company Wealth Ltd. Services Ltd. (MOFSL) Advisors Pvt. Ltd. Finance Ltd. (MOHFL) Ltd. (MOIAL) Ltd. (MOAMC) (MOWL) (MOAIAPL) Motilal Oswal FinvestLtd. (MOFL) 15 KEY HIGHLIGHTS FINANCIALS BUSINESSES Strong balance sheet is important not only to survive but also to thrive Covid -19 pandemic Being resilient over last NBFC crisis in India 36 years and weathered multiple crisis Global Financial Crisis (Lehman Brothers) Importance of net worth in Financial Services sector Ability to absorb the Grab the new To reward the Indicator of efficient shocks in a uncertain opportunity and to shareholders fund utilization environment foster existing business - Supporting working capital Total pay out till date - NSEL needs of Broking business 18.5% XIRR on fund based - Dividend - ₹ 1,037 Cr - Housing Finance stress - Sponsor investments in AMC, investment - Buyback - ₹ 336 Cr PE & RE funds 16 KEY HIGHLIGHTS FINANCIALS BUSINESSES 22% CAGR growth in Net Worth for last 10 years Operating Business Dividend Payout Treasury Investments Book Value per share ₹ Bn 82.7 Rs. 557 62.5 56.7 28.8 44.6 17.2 30.9 30.5 17.2 28.9 12.8 B p o e o r k s V h a a l r u e e 11.7 12.9 14.4 17.8 4.5 5.0 2.3 47.9 57.2 65.7 0.5 1.3 26.6 29.2 33.9 39.2 ₹ 85 12.6 13.4 15.0 18.0 -0.2 -0.5 -1.1 -1.5 -2.2 -3.7 -5.3 -7.5 -8.3 -11.8 -11.8 FY14 FY15 FY16 FY17 FY18 FY19 FY20 FY21 FY22 FY23 9MY24 8% 18% 4% 22% Avg. Treasury 26% Avg. Operating Dividend Net Worth Investments PAT Avg. PAT ROE PAT ROE Payout(2) CAGR ROE(1) 1. XIRR of 18.5% since inception 2. Dividend Payout includes buyback and is paid out on Operating PAT 17 FY18 figures are adjusted for INDAS transition KEY HIGHLIGHTS FINANCIALS BUSINESSES Future is as exciting as past Engine #1 Operating PAT grew 31% Expect to grow at 15-20% CAGR Total Operating PAT CAGR in last decade Treasury Investments Engine #2 Book grew 45% CAGR in Maintain / improve existing IRR of 18.5% Treasury Investments last decade 30% of Operating PAT in Continue to distribute 25-30% of Operating Dividend Payout last decade PAT Grew 22% CAGR in last Maintain / improve the same Net Worth decade 18 Operating PAT CAGR is for FY14 –FY23 KEY HIGHLIGHTS FINANCIALS BUSINESSES Motilal Oswal - Q3FY24 & 9MFY24 Performance 19 Key Highlights for Q3FY24 Assets under advice Revenue Operating PAT Total PAT (incl. OCI) Net Worth ₹ 4.4 tn 43% YoY ₹ 13.8 bn 30% YoY ₹ 3.1 bn 35% YoY ₹ 7.7 bn 222% YoY ₹ 82.7 bn 33% YoY Lending Book1 ROA (incl. OCI)2 ROE2 Clients Employees ₹ 110.6 bn 47% YoY 9.8% 36.8% ~6.0 mn 13% YoY 10,747 Trailing 12 months 1. Average lending book Market Capitalization Revenue Operating PAT Total PAT (incl OCI) 2. ROA and ROE are annualized ₹ 197.4 bn3 3. As on December 31, 2023 ₹ 52.8 bn ₹ 10.7 bn ₹ 21.2 bn 20 KEY HIGHLIGHTS FINANCIALS BUSINESSES Consolidated P&L PARTICULARS (₹ Mn) Q3FY24 Q3FY23 YoY (%) Q2FY24 QoQ (%) 9MFY24 9MFY23 YoY (%) Capital Markets (Broking, Distribution & IB) 10,285 7,565 36% 10,191 1% 29,323 20,892 40% Asset and Wealth Management 2,872 2,518 14% 2,542 13% 7,853 7,062 11% Housing Finance 1,464 1,357 8% 1,435 2% 4,335 3,934 10% Total Revenues 14,620 11,440 28% 14,168 3% 41,511 31,887 30% Total Revenues after Intercompany adj. 13,771 10,607 30% 13,539 2% 39,277 29,819 32% Operating Expense 2,782 2,214 26% 2,797 -1% 7,752 6,577 18% Employee Expense 2,992 2,555 17% 3,054 -2% 9,167 7,208 27% Interest Expense 2,495 1,562 60% 2,276 10% 6,828 3,797 80% Other Expense 1,344 1,181 14% 1,571 -14% 4,290 3,543 21% Total Expense 9,613 7,512 28% 9,699 -1% 28,037 21,125 33% PBT 4,158 3,095 34% 3,840 8% 11,240 8,694 29% Operating PAT 3,113 2,299 35% 2,884 8% 8,437 6,470 30% Treasury Investments PAT(1) 3,486 -35 - 2,427 - 8,742 1,199 - PAT 6,599 2,263 192% 5,312 24% 17,179 7,669 124% Treasury Investments PAT through OCI (OCI)1 1,142 142 - 244 - 2,831 43 - PAT (incl. OCI) 7,741 2,405 222% 5,555 39% 20,011 7,712 159% PBT Margin on Net Revenue 49% 45% 45% 46% 45% 21 1.Treasury Investments PAT & OCI comprises of MTM gains on our Treasury Investment Book KEY HIGHLIGHTS FINANCIALS BUSINESSES Consolidated Balance Sheet Particulars (₹ Bn) Dec 31, 2023 Mar 31, 2023 Net Worth Deployment SOURCES OF FUNDS Net Worth 82.7 62.5 9% Borrowings 126.0 103.1 5% Minority Interest 0.4 0.3 15% Total Liabilities 209.0 165.9 70% APPLICATION OF FUNDS Fixed assets (net block) 5.7 4.7 Treasury Investments Investments 63.9 47.9 MOHF Loans and Advances 101.4 72.2 CorporateOffices Net Current Assets(1) 38.0 41.2 Working Capital & Others Total Assets 209.0 165.9 1. Net Current Asset includes cash and cash equivalents and bank balance of ~₹ 30.2 bn in Dec-23. Out of which Treasury investments have earned XIRR (since inception) of 18.5% 22 unencumbered cash & cash equivalents is ~₹ 18.2 bn KEY HIGHLIGHTS FINANCIALS BUSINESSES Capital Markets • MOFSL amongst top 3 brokers in terms of Gross 8.1% 7.5% ₹ 35,000+ ₹ 263 Bn ₹ 7.7 Bn Brokerage. Focus to further improve our market share in a fast growing market Retail F&O premium Retail cash market One of the highest Distribution AUM; Distribution Net market share; +60bps QoQ share; +42 bps QoQ ARPUs in the industry +25% YoY Sales in Q3FY24 • Strong surge in cash volumes leading to growth in retail brokerage PARTICULARS (₹ Mn) Q3FY24 Q3FY23 YoY (%) Q2FY24 QoQ (%) 9MFY24 9MFY23 YoY (%) • ADTO grew by 95% YoY/8% QoQ to ₹ 5,683 bn. Revenues 10,285 7,565 36% 10,191 1% 29,323 20,892 40% • Brokerage 5,361 4,366 23% 5,823 -8% 15,705 12,650 24% • Retail Cash ADTO market share grew by 164 bps • Distribution 563 503 12% 463 22% 1,475 1,321 12% YoY / 42 bps QoQ to 7.5%. • Interest 3,536 2,105 68% 3,146 12% 9,299 5,127 81% • F&O Premium market share for Dec 2023 was 8.7% • IB 193 47 306% 210 -8% 899 261 245% • Other Operating 632 543 16% 548 15% 1,945 1,534 27% • Number of Franchisees increased from 8,033 as on Income Mar 23 to 9,397 as on Dec 23 Total Expense 7,592 5,683 34% 7,804 -3% 22,142 15,907 39% • Employee Expense 1,869 1,613 16% 2,045 -9% 6,051 4,676 29% • Acquired 4.4 lakh new clients in 9MFY24. • Commission Expense 2,585 2,003 29% 2,684 -4% 7,297 5,870 24% • Completed 6 IB deals with total issue size of ₹ 52 • Interest Expense 2,048 1,119 83% 1,806 13% 5,342 2,507 113% bn during Q3FY24 • Other Expense 1,091 948 15% 1,269 -14% 3,451 2,854 21% PBT 2,692 1,882 43% 2,387 13% 7,182 4,984 44% • MOFSL Institutional Equities has been ranked 1 for PAT 2,016 1,397 44% 1,796 12% 5,393 3,702 46% Best Execution and Corporate Access by PBT Margin onNet Asiamoney Poll 2023 48% 42% 42% 43% 40% Revenue* 23 * Net Revenue = Revenue less Commission and Interest Expenses KEY HIGHLIGHTS FINANCIALS BUSINESSES Super App to offer bouquet of financial services Trade Invest 24 KEY HIGHLIGHTS FINANCIALS BUSINESSES Best in class customer experience Common Portfolio including portfolio analysis Get easy Portfolio view with Asset and Product wise Dashboard Personalization Global Search Personalized landing page One search menu for all based on customer needs & trading & investment past requirements products Futuristic Quick & easy order placements Customizable Watchlist Buy/Sell Stocks, US Stocks and Get watchlists for Indian Stocks, customer Mutual funds in few clicks US Stocks & even Mutual Funds experience Powerful Indicators Superstar investors Easy decision making with the help of Get insights from ace technical indicators, moving average, investors portfolios SWOT analysis and Fundamentals 25 KEY HIGHLIGHTS FINANCIALS BUSINESSES Broking and Distribution – Emphasis on Revenue & Productivity Robust DP AUM growth (₹ Bn) Rising Distribution AUM (₹ Bn) ADTO continue to rise 5,683 37 263 213 2,2932 0 182 2,2436 9 5,647 134 8 6 4 8 1 8 5 9 8 3 9 4 5 9 90 21384 4 2 3 8 9 8 3 7 1 7 2,447 2,897 , , , , 4 1 1 1 2 846 216 411 Mar-20 Mar-21 Mar-22 Mar-23 Dec-23 Mar-20 Mar-21 Mar-22 Mar-23 Dec-23 FY20 FY21 FY22 FY23 Q3FY23 Q3FY24 F&O (₹ Bn) Cash (₹ Bn) One of the Highest ARPUs* Gaining Market Share Steady Client base 8.1% 10.0 40.3 45.0 7.5% 35.0 9.0 40.0 7.2% 7.5% 8.0 28.5 35.0 6.9% 7.0 7.1% 30.0 6.5% 6.0 19.7 25.0 5.0 14.5 3 9 6 7 3 3 1 7 6.2% 4.0 12.0 1 2 5 0 . . 0 0 6 7 2 5 2 7 2 5 5.8% 3.0 7 , 2 , 2 , 4 , 3 , 3 , 2 , 9 , 2.0 10.0 7 8 8 0 9 3 0 5 3.2 3.8 5.6 9.0 8.1 8.2 1 2 1 3 1 3 2 3 1.0 5.0 5.1% 0.0 0.0 Q4 FY23 Q1 FY24 Q2 FY24 Q3 FY24 Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Dec-23 Brokerage ARPU (₹) Overall ARPU (₹) F&O Premium Market Share % Retail Cash Market Share % Active Clients (Lakhs) Total Clients (Lakhs) 26 *Revenue includes Gross Brokerage, Distribution and Interest Income for TTM KEY HIGHLIGHTS FINANCIALS BUSINESSES Inst. Equities – Solid track record of Research & Corporate Access award  Focus driven differentiated research products covering:  250+ companies  21 sectors  catering to 840+ institutional clients  50+ research & corporate access team  Institutional team wins big in Asiamoney poll 2023. Overall Team Ranking Overall  Best Execution  Thematic Strategy  Best Domestic Brokerage for Sales  Best Corporate  Banks  Best Brokerage Transformation  Small/Mid Caps Access  Transportation & Logistics 27 KEY HIGHLIGHTS FINANCIALS BUSINESSES Investment Banking – Strong deals across fund raising services Q3FY24 H1FY24 IPO QIP Block Deal IPO IPO ₹ 6.1 Bn ₹ 10.0 Bn ₹ 8.4 Bn ₹ 10.1 Bn ₹ 19 Bn Buyback Buyback IPO IPO QIP ₹ 10.2 Bn ₹ 0.6 Bn ₹ 4.9 Bn ₹ 6.4 Bn ₹ 7.5 Bn QIP Block Deal IPO Block Deal ₹ 7.5 Bn ₹ 3.1 Bn ₹ 12.0Bn ₹ 1.5 Bn Senior Management hiring expect to improve share in IB league table 28 KEY HIGHLIGHTS FINANCIALS BUSINESSES Asset and Wealth Management • AMC AUM stood at ₹ 649 bn, up 40% YoY/17% QoQ with MF AUM at ₹ 429 bn and Alternates AUM at ₹ 220 bn. ₹ 649 Bn 34% ₹ 94 Bn ₹ 896 Bn ₹ 30 Bn • ₹ 12.4 bn flows in Small Cap MF NFO, highest in the Small AMC AUM; +40% Alternates share in PE & RE Fee Earning Wealth AUM; Wealth Net Sales in Cap MF category till date YoY AMC AUM +117% YoY Q3FY24; +152% YoY • Market share gain in Gross Sales ,Net Sales & SIP due to PARTICULARS (₹ Mn) Q3FY24 Q3FY23 YoY (%) Q2FY24 QoQ (%) 9MFY24 9MFY23 YoY (%) top quartile performance across schemes like Midcap, LMC & BAF Total Revenues 2,872 2,518 14% 2,542 13% 7,853 7,062 11% • In Alternate assets, 19 out of 19 schemes have • AMC 1,721 1,412 22% 1,501 15% 4,599 4,243 8% outperformed the benchmark in past 1 year period • PE & RE 452 525 -14% 470 -4% 1,342 1,248 8% • Added ~261k new SIPs in Q3FY24, up 293% YoY/24% QoQ • Wealth 699 581 20% 571 22% 1,912 1,571 22% and SIP flows of ₹ 769 cr in Q3FY24, up 112% YoY/19% QoQ Total Expense 1,815 1,592 14% 1,629 11% 5,006 4,450 13% • Employee Expense 818 719 14% 742 10% 2,288 1,877 22% • Added net 51 Wealth RMs in last 9 months resulting into higher employee expense. • Commission Expense 644 563 14% 565 14% 1,768 1,704 4% • Investments in RM has brought down operating margin • Other Expense 353 310 14% 322 9% 949 868 9% to 30% compared to historical trend of 35% - 40%. PBT 1,057 926 14% 913 16% 2,847 2,612 9% Expect to recoup margins in coming years PAT 789 672 17% 682 16% 2,128 1,924 11% • Partial investment exits in private equity funds through IPO in Happy Forgings Limited and Updater Service Limited at IRR of 32.5% and 15.5% respectively in Q3FY24 29 KEY HIGHLIGHTS FINANCIALS BUSINESSES Turnaround in AMC fund performance yielding the result now Performance for past one year Q3FY23 Q3FY24 Total No. of Funds (MF + PMS + AIF) 27 SIP Market Share 0.9% 1.6% No. of funds outperformed benchmark 24 MF Gross Sales Market Share 0.7% 1.9% Mutual Fund 5 (0.8)% 3.1% MF Net Sales Market Share Alternates (PMS + AIF) 19 MF Redemption Market Share 1.4% 1.3% Outperforming Funds (%) 89% Performance as on Dec 31, 2023 30 KEY HIGHLIGHTS FINANCIALS BUSINESSES Asset Management – Robust flows and folio additions Strong growth in AMC AUM (₹ Bn) Robust growth in AMC Gross Sales (₹ Bn) 649 49 40 553 514 21 22 457 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Q4FY23 Q1FY24 Q2FY24 Q3FY24 AMC MF SIP flows AMC MF Folios Continue to Rise (in Mn) Dec 23 flow 2.5 2.81 Bn 1.6% 9.00 1.8% 1.4% 1.9 1.9 8.00 1.6% 1.2% 1.2% 7.00 1.4% 6.00 0.9% 1.2% 1.3 SIP Flow (₹ Bn) 5.00 1.0% 1.0 4.00 0.8% 3.00 0.6% Market Share 2.00 0.4% 3.63 5.07 5.32 6.47 7.69 1.00 0.2% 0.00 0.0% Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Mar-20 Mar-21 Mar-22 Mar-23 Dec-23 31 KEY HIGHLIGHTS FINANCIALS BUSINESSES Marketing Campaign yielding robust flows High Quality, High Growth ₹ Mn Marketing Expense Net Revenue % FY23 89 3,594 2.5% 9MFY24 85 3,061 2.8% Small Cap NFO Large Cap NFO Click on images to see Ad 32 KEY HIGHLIGHTS FINANCIALS BUSINESSES Strong performance across Private Equity & Real Estate Funds Successful launch of PE & RE Funds over years Robust performance across funds Expected exit in near future PE RE IBEF IV Valued IRR (%) FY25 FY25 FY26 IREF V ₹ 45 Bn 26.8% IREF IV ₹ 12 Bn 22.9% Fully IBEF III ₹ 11.5 Bn 20.5% Exited IRR (%) Exited in IREF III ₹ 23 Bn 18.7% 18.1% 18.1% FY22 IREF II ₹ 10.3 Bn 13.9% IBEF II ₹ 4.9 Bn IBEF I ₹ 9.5 Bn ₹ 5.5 Bn FY07 FY12 FY14 FY17 FY18 FY19 FY21 FY22 IBEF I IBEF II IBEF III IREF II IREF III IREF IV IREF V *Valuations are done on half yearly basis Investments spread across sectors PE & RE Investments 37 50.0 40 30.9% 45.0 30 A 35 UM (₹ Bn) 25.1% 24.4% 40.0 30 35.0 25 30.0 16 No. of 25.0 15 20 12 investments 13.5% 20.0 11 9 15 15.0 10 10.0 6.0% 9.5 23.0 45.0 4.9 10.3 11.5 12.0 5 5.0 - 0 Consumer Financial Niche Pharma Service IBEF II IBEF III IBEF IV* IREF II IREF III IREF IV IREF V Services Manufacturing *Deployed ₹26.6 Bntill 15thJan, 24 33 KEY HIGHLIGHTS FINANCIALS BUSINESSES Carry income from seven funds to be realized in coming years Illustration of Expected Carry Income for Private Equity IRR- 20% Carry 20% Fund Raised Cumulative Returns Carry Income ₹ 100 after 8 years ₹ 330 ₹ 66 Illustration of Expected Carry Income for Real Estate Fund Raised IRR- 16% Cumulative Returns Carry 15% Carry Income ₹ 100 after 4 years ₹ 80 ₹ 12 34 KEY HIGHLIGHTS FINANCIALS BUSINESSES Wealth Management – Strengthening RM base for sustainable growth Strong growth in WM AUM (₹ Bn) RM Productivity 4.5 13.5 16.0 12.2 AUM per 896 4.0 11.0 14.0 10.3 RM (₹ Bn) 3.5 12.0 3.0 7.8 10.0 2.5 8.0 Revenue per 2.0 6.0 RM (₹ Mn) 520 1.5 4.0 1.0 344 0.5 1.2 2.1 2.4 2.9 3.8 2.0 - - 156 253 FY20 FY21 FY22 FY23 9MFY24 FY20 FY21 FY22 FY23 9MFY24 Productivity is impacted due to net hiring of 51 RM during 9MFY24 Investment in RMs impacted margin Continued traction in RM addition Added 89 RMs 233 Family 7,000 250 44% 182 6,000 RM 200 37% 5,000 144 126 129 123 150 30% 4,000 3,000 100 2,000 50 1,000 3,719 4,186 5,004 4,665 5,358 6,302 0 0 Mar-19 Mar-20 Mar-21 Mar-22 Mar-23 Dec-23 30% of RMs have vintage of more than 3 years 35 FY22 FY23 9MFY24 KEY HIGHLIGHTS FINANCIALS BUSINESSES Focus on building recurring revenue… Closing AUM/LoanBook(₹ Bn) Net Yield/NIM Net Revenue (₹ Mn) Particulars Q3FY24 Q2FY24 Q3FY23 Q3FY24 Q2FY24 Q3FY23 Q3FY24 Q2FY24 Q3FY23 Asset Management 649 553 466 0.73% 0.73% 0.74% 1,152 1,005 911 Wealth Management* 529 468 384 0.52% 0.48% 0.51% 644 553 524 Private Equity 94 98 95 1.62% 1.67% 2.06% 388 411 466 Total Asset and Wealth 1,272 1,118 945 0.73% 0.71% 0.80% 2,184 1,968 1,901 Management Distribution Assets 263 250 194 0.56% 0.38% 0.55% 357 227 281 Margin & Debtors Funding Book 73 67 39 5.88% 5.75% 6.04% 1,086 982 588 Housing Finance 38 38 37 8.50% 8.31% 8.24% 801 780 754 *Wealth Management figures are excluding custody assets 36 KEY HIGHLIGHTS FINANCIALS BUSINESSES Strong ARR across Capital market & Asset and Wealth Management Particulars (₹ Mn) Q3FY24 Q3FY23 YoY% Q2FY24 QoQ % Annual Recurring Revenue (ARR) 3,745 3,108 20% 3,490 7% Asset Management Fees 1,508 1,324 14% 1,393 8% Wealth & Distribution 454 534 -15% 456 -2% Net Interest Income 1,488 990 50% 1,339 11% Other operating income 294 260 13% 292 1% Transaction Bearing Revenue (TBR) 3,365 2,776 21% 3,285 2% Brokerage 2,563 2,259 13% 2,792 -8% Wealth & Distribution 579 288 101% 322 80% Other operating income 223 229 -2% 171 30% ARR as % of Net Revenue* 53% 53% 52% ARR Assets (₹ Bn.) 1,065 850 25% 995 7% Retention 1.41% 1.46% 1.40% *Excludes Revenue from IE, IB & HFC businesses 37 KEY HIGHLIGHTS FINANCIALS BUSINESSES Home Finance • Retail disbursement grew by 50% YoY/25% QoQ to ₹ ₹ 37.8 Bn ~2.5 Bn 7.7% ₹ 12.5 Bn 3.3% 1.78 bn Disbursements in NIM in 9MFY24 Net worth as on ROA in 9MFY24 AUM as on Dec-23 Q3FY24; up 25% QoQ Dec-23 • Net gearing stood at 2.0x, CRAR remained robust at 47.5% PARTICULARS (₹ Mn) Q3FY24 Q3FY23 YoY (%) Q2FY24 QoQ (%) 9MFY24 9MFY23 YoY (%) • Incremental COF for 9MFY24 was 8.3% Interest Income 1,397 1,308 7% 1,382 1% 4,159 3,804 9% Interest Expense 596 554 8% 601 -1% 1,820 1,598 14% • Hired net 232 Sales RM during Q3FY24 and 373 Net Interest Income Sales RM in last 12 months. This impacted the cost 801 754 6% 780 3% 2,339 2,207 6% (NII) to income ratio Total Income 868 803 8% 834 4% 2,514 2,336 8% Operating Cost 379 295 28% 369 3% 1,085 882 23% • Focus on improving productivity through improvement in TAT and Approval ratio -Employee Cost 305 223 37% 267 14% 828 655 26% -Other Cost 74 73 2% 102 -28% 257 227 13% • New leadership across senior management Operating Profit 489 507 -4% 464 5% 1,430 1,454 -2% Provisioning 12 38 -69% 29 -59% 135 125 8% • Building blocks are in place, expect strong QoQ ramp up in disbursements and AUM growth in the PBT 477 469 2% 435 10% 1,294 1,329 -3% coming years PAT 363 363 0% 328 11% 978 1,018 -4% 38 KEY HIGHLIGHTS FINANCIALS BUSINESSES Home Finance - Experienced Leaders Sukesh Bhowal has a rich experience of 27 years in Business Management, Sales & Distribution, Retail, Mortgage Chief & Real Estate Lending and Retail Banking. He was associated with DCB Bank, where he headed the Mortgages, Executive Micro-Mortgages, Construction Finance & Gold Loans and was responsible for starting and scaling up these Officer businesses. He was also associated with HDB Financial Services, Citibank and HSBC. Sukesh has strong academic credentials of Bachelor of Technology fromIIT Bombay and PGDM in Finance & Marketing fromIIM Lucknow. Shobhit Doru has a rich experience of 25 years in Sales, Product, Strategy and Analytics in Mortgage, SME Chief Lending and LAP product. Previously, he was associated with Bajaj Finserv, where he was Head- Risk of the SME Operating Business vertical. In his previous stints, he was also associated with Bajaj Housing Finance, Standard Chartered Officer Bank and IDBIBank. Shobhit has done an Accelerated Management Programat the Indian Schoolof Business. Rajesh Maiya has a rich experience of 25 years in Sales & Distribution, Channel Management and Customer Chief Service. Prior to joining MOHFL, he was associated with Aavas Financiers, where he was National Sales Manager Business and was responsible for developing and managing Home loan and LAP business. He was also associated with Officer ICICI Bank in his previous stint. Rajesh has done PGDM fromMangalore University. Mr. Bhavin Shah has a rich experience of over 12 years into NBFC domain with expertise in Treasury, Asset- Chief Liability management, Financial reporting and analysis, Budgeting, Business planning and Strategy. Prior to Financial joining MOHFL, he was Deputy Vice President at IIFL Finance Group, where he was responsible for overseeing Officer the Treasury FrontOfficeforthe group. Bhavin is a Chartered Accountant & post graduate of Mumbai University. 39 KEY HIGHLIGHTS FINANCIALS BUSINESSES Home Finance – Focus on strengthening sales and improve productivity Growing Disbursements (₹ Mn) Improving sales productivity 3,607 2,471 • Sales and lead management is now through digital mode with geo- 2,022 1,974 tagging and geo-fencing capabilities 933 • 100% end to end paperless approval process, with 85% e-sign of loan documents Q3FY23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 • Focus on hiring senior sales leadership team Strengthening RM Sales Force • Login to sanction ratio improved to 46% in Q3FY24 vs 42% in Q2FY24 856 753 715 • Revamped sales distribution framework through dedicated team for 624 small distributors, large distributors and direct sales 540 498 428 415 439 • Reoriented entire training framework with dedicated senior team. Apr-23 May-23 Jun-23 Jul-23 Aug-23 Sep-23 Oct-23 Nov-23 Dec-23 40 KEY HIGHLIGHTS FINANCIALS BUSINESSES Home Finance – Diversified products, geographies and liabilities Product Mix Wide Geographic Reach 32% New Purchase PRESENCE ACROSS 24% Self-Construction 111 LOCATIONS IN 12 STATES/UTS 13% Construction Finance* HR DL UP 13% Resale RJ 08% LAP 136 Branch Sales GJ MP CG Manager servicing the 03% Home Impr./Ext. MH above locations TS 02% Composite KA AP 07% Others TN AUM by Ticket Size Diversified Liability Mix Dec-23 – 1.03 Mn 3% 8% 7% 11% 7% 8% 7% 5% 4% Term loan 07% Up to 0.5 Mn 16% 51% 17% NCD 28% 34% 0.5 –1.0 Mn 40% 8% 21% NHB 31% 1.0 –1.5 Mn Securitization 14% 1.5 –2.0 Mn ECB 60% 55% 49% 45% 50% 09% 2.0 –2.5 Mn 05% Above 2.5 Mn Note: FY20 FY21 FY22 FY23 9MFY24 *Construction Finance with Motilal Oswal Real Estate (MORE); lending to CAT A builders 41 KEY HIGHLIGHTS FINANCIALS BUSINESSES Home Finance – Stable asset quality ECL Provisioning Details Robust Collection Efficiency PARTICULARS (₹ Mn) Dec 2023 103% 101.3% 100% 98% 99% CE incl. Stage 1 & 2 36,748 prepayments was 129% in % portfolio in stage 1 & 2 97.88% Dec-23 Stage 3 796 % portfolio in Stage 3 2.12% ECL Provision % Stage 1 & 2 1.34% Total Assets 37,544 ECL Provision 811 ECL Provision % 2.16% Q3YF23 Q4FY23 Q1FY24 Q2FY24 Q3FY24 Stage 3 Provision Coverage Ratio 40.2% Collection efficiency (CE) = Total EMI Collected/ 1 EMI Due. CE is excl. prepayments. Total Provision Coverage Ratio 102% GNPA and NNPA for Total Book GNPA for New Book 20 1.0% 1.2% Loan book GNPA 18 0.9% 0.9% 1.0% in ₹ Bn 16 0.8% 0.8% 2.1% 2.1% NNPA 14 0.8% GNPA 1.9% 12 10 0.4% 0.6% New book 1.3% 1.3% 8 (disbursements 1.1% 0.4% 6 starting Apr 18) 0.1% 4 constitute 52% of 0.2% 2.5 8.2 14.2 14.0 16.8 18.0 2 total book 0 0.0% Mar-20 Mar-21 Mar-22 Mar-23 Jun-23 Sep-23 Dec-23 Q1FY24 Q2FY24 Q3FY24 42 KEY HIGHLIGHTS FINANCIALS BUSINESSES Home Finance – Key Ratios Parameters Q3FY24 Q3FY23 Q2FY24 9MFY24 9MFY23 Yield 14.2% 13.8% 14.2% 14.3% 13.9% COF 8.3% 7.9% 8.3% 8.3% 7.9% Spread 5.9% 5.9% 6.0% 6.0% 6.0% NIM 7.7% 7.7% 7.7% 7.7% 7.8% Cost/Income 43.7% 36.8% 44.3% 43.1% 37.8% ROA 3.6% 3.8% 3.3% 3.3% 3.7% ROE 12.0% 13.5% 11.2% 11.2% 13.0% CRAR 47.5% 46.3% 51.6% 47.5% 46.3% Net Leverage 2.0x 2.2x 2.0x 2.0x 2.2x *All ratios are annualized 43 KEY HIGHLIGHTS FINANCIALS BUSINESSES Treasury Investments • Treasury Investment includes sponsor commitments ₹ 58.7 Bn 18.5% 19.9% cum investments in equity MF, PE funds, Real estate Total equity investment Cumulative XIRR on XIRR on PE/RE including alternate funds total investments investments funds, AIF and strategic equity investments. • Total equity investment including alternate funds PARTICULARS (₹ Mn) Q3FY24 Q3FY23 Q2FY24 9MFY24 9MFY23 was at ₹ 58.7 bn as of Dec-23, MTM of these gains Revenues 4,138 221 2,952 10,446 1,863 are included in earnings under Ind-AS reporting. -MF/Alternates 3,289 28 1,766 8,327 1,673 • Cumulative XIRR on total investments is 18.5%, -PE/RE 697 77 949 1,659 410 whereas XIRR on PE/RE investments stood at 19.9%. -Unlisted Shares/Others 152 117 237 461 -221 Expenses 213 226 232 665 563 • These investments have helped “seed” our new PAT 3,486 -35 2,427 8,742 1,199 businesses, which are scalable, high-RoE OCI 1,129 142 241 2,842 39 opportunities. They also serve as highly liquid TCI 4,615 107 2,668 11,585 1,237 “resources” available for future investments in business, if required. Note:Unlisted investments’ (incl. PE/RE funds) are fair valued and recognized on half yearly basis 44 KEY HIGHLIGHTS FINANCIALS BUSINESSES Treasury Investments – Skin in The Game Skin in the Game in AMC (₹ Bn) Strong Growth in investments over the years 58.7 649 AMC AUM 27 Sponsor AUM 22 Promoter 43.3 26.9 AUM 40.9 15.7 31.3 Skin in the game in PE & RE (₹ Bn) 17.8 13.4 136 Total Capital Raise till date 31.8 17.5 27.6 1.7 23.1 13 Sponsor 17.9 15.8 Commitment in PE & RE Mar-20 Mar-21 Mar-22 Mar-23 Dec-23 3 Promoter Commitment Investment at cost (₹ Bn) Gain (₹ Bn) in PE & RE 45 KEY HIGHLIGHTS FINANCIALS BUSINESSES MOFSL - ESG Initiatives Launched online ESG profile platform, CRISIL has assigned “STRONG”rating to which adheres to international frameworks such as MOFSL in its Sustainability Yearbook 2022 IFC, GRI, SASB, CDP etc. ENVIRONMENTAL SOCIAL GOVERNANCE • More than 80% of servers are in • Physical & emotional wellbeing • Diverse Board Composition virtual environment which reduces assistance program • 50% Independent Director in Holding electricity cost & carbon foot print • Employee engagement programs- Company and at least 50% in material subsidiary • Main office building is equipped with sports events & festival celebrations rainwater harvesting system and • Average Board experience >30 years • Set standard practices is followed recycled waste water is reused as across all branches to ensure safety • Remuneration policy recommended flush water and in watering plants by Nomination of employees & Remuneration Committee • Planted and maintaining trees in & • Dedicated Talent Development around the office premises. • Corporate Governance Program for developing High • Food wastage awareness drive in Potentials, fast-tracking for Hi-Pos • Code of Conduct Policy head office • Company has formed committee W- • Risk Management Policy • We ensure that we fund to projects I-N-G-S (Women Initiative to Nurture, • Data privacy policy which is on non agriculture land & Grow & Succeed) to ensure • Business Responsibility Reporting non forest land and having all substantial women representation in • Policy for prohibition of Insider environmental clearance. mid-senior level of the organization Trading • MOHF follows International Finance • Offers home loan at concessional • Prevention of sexual harassment Corporation (IFC) Performance rate to women borrowers. at workplace policy & awareness Standard 46 KEY HIGHLIGHTS FINANCIALS BUSINESSES Safe Harbour This earning presentation may contain certain words or phrases that are forward - looking statements. These forward-looking statements are tentative, based on current analysis and anticipation of the management of MOFSL. Actual results may vary from the forward-looking statements contained in this presentations due to various risks and uncertainties involved. These risks and uncertainties include volatility in the securities market, economic and political conditions, new regulations, government policies and volatility in interest rates that may impact the businesses of MOFSL. MOFSL has got all market data and information from sources believed to be reliable or from its internal analysis estimates, although its accuracy can not be guaranteed. MOFSL undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof. DISCLAIMER Thisreport isfor information purposes only &does notconstrue to beany investment, legalortaxation advice. It isnot intended asanofferorsolicitation forthe purchaseorsaleof any financial instrument. Any action taken by you on the basis of the information contained herein is your responsibility alone and MOFSL and its subsidiaries or its employees or directors, associates will not be liable in any manner for the consequencesofsuchactiontakenbyyou.Wehaveexercisedduediligenceincheckingthecorrectnessandauthenticityofinformationcontainedherein,butdonotrepresentthatitisaccurateorcomplete.MOFSL or any of its subsidiaries or associates or employees shall not be in any way responsible for any loss or damage that may arise to any person from any inadvertent error in the information contained in this publication.Therecipientofthisreportshouldrelyontheirowninvestigations.MOFSLand/oritssubsidiariesand/ordirectors,employeesorassociates mayhaveinterestsorpositions,financialorotherwiseinthe securitiesmentionedinthisreport. 47 For any query, please contact : SHALIBHADRA SHAH CHIEF FINANCIAL OFFICER 91-22-7193 4917 / 98190 60032 shalibhadrashah@motilaloswal.com CHETAN PARMAR HEAD INVESTOR RELATIONS 91-22-7190 6600 / 74003 12700 chetan.parmar@motilaloswal.com