il&fs investmart


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il&fs investmart

  1. 1. November 2006
  2. 2. Agenda Indian Financial Market Overview Company Overview Business Strategy Highlights2
  3. 3. 3    0 50000 100000 150000 200000 250000 300000 350000Apr-05 120516  May-05 130146Jun-05 169857 Jul-05 184882Aug-05 221636Sep-05 226661Oct-05 179890Nov-05 162253Dec-05 227238Jan-06 228734 Rising Markets Driven by :Feb-06 205424 Increased retail participation Continued Surge in FII flows believe, the best is yet to come !!!Mar-06 328126Apr-06 264827 Robust CM Market GrowthMay-06 297213Jun-06 223048 Jul-06 173385 capital markets are concerned, and of course we Increased primary mobilisation by Mutual Funds (Rs. in cr)Aug-06 193871 Just to sum it up, India has had a dream year as far as Market Summary Primary market issuances continue to attract heavy flows 0 2000 4000 6000 8000 10000 12000 14000 0 100,000 200,000 300,000 400,000 500,000 600,000 700,000 800,000 Apr-05 6154 Apr.05 195,962 May-05 6715May.05 208,375 Jun-05 7194 Jun.05 271,242 Indian Capital & Financial Jul-05 7635 Jul.05 308,160 Aug-05 7805Aug.05 372,301 Sep-05 8634Sep.05 399,750 Oct-05 7892 Oct.05 433,651 Nov-05 8789 Nov.05 395,845 Dec-05 9398Dec.05 523,803 Jan-06 9920 Jan.06 487,580 Feb-06 10370Feb.06 492,664 Mar-06 11280Mar.06 734,842 Apr-06 Apr.06 12043 737,832 May-06May.06 10399 Surge in F&O Market Volumes 742,390 Jun-06 10609 Jun.06 SENSEX – Hitting the all time high 556,797 Jul-06 10744 Jul.06 477,255 Aug-06 11699Aug.06 (Rs. in cr) 469,665 Sep-06 12454
  4. 4. Indian Capital & Financial Market Summary 12 FII Investments 10.7 9.6 10 8.1 8 6.8 6 4 3 2 0.8 0 CY 2001 CY 2002 CY 2003 CY 2004 CY 2005 CY 2006 Mutual Fund Industry 60 52 50 40 32 23.1 30 18.2 20 10 0 FY 02-03 FY 03-04 FY 04-05 FY 05-06 Source: AMFI4
  5. 5. Agenda Indian Financial Market Overview Company Overview Business Strategy Highlights5
  6. 6. IL&FS Investsmart An Introduction • One of the leading financial services companies in India – Focused on retail broking (including margin financing), distribution of financial products and IPO financing – Significant growing presence in Merchant Banking, & Institutional Brokerage Businesses • Pan India presence with a network of 259 outlets (including business associates) spread across 124 major cities in India • Total Income in FY 06 of Rs. 2170 mn. and net profit of Rs. 691 mn. Shareholding Pattern IL&FS FIIs & Public 30% 33% SAIF 10% E*TRADE 27%6
  7. 7. Promoter History - IL&FS  Promoted by Infrastructure Leasing and Financial Services Ltd  Shareholders of IL&FS include SBI, ORIX-Japan, IFC-Washington, Credit Commercial de France, Indivest Pte Ltd(an Affiliate of Govt. of Singapore)  Business operations of the promoter  Infrastructure and Development Services : Sectors such as Surface Transport and Transportation Systems,Water Supply, Hydro Power, Special Economic Zone, Port and Environment & Social Management Group.  Investment Banking : Strategy, Asset Financing, Corporate Advisory, Capital Markets, Project Financing  Made contributions to the following trusts: IL&FS Infrastructure Equity Fund, IL&FS Investment Trust –I, II, IV  The Indian Innovation Award-2005: Awarded to IL&FS by President of India7
  8. 8. Strategic Partner • E*TRADE – Pioneer in the field of Internet Broking – Global Leader – Covers 3.5 million customers and 2.7 million households worldwide – Presence in over 12 countries – Superior Technology Platform Delivering a diversified and integrated portfolio of innovative, customer-focused brokerage and banking products and services to Retail, Corporate and Institutional Clients8
  9. 9. Product Portfolio Distribution of Financial Products Investment Banking Portfolio Management Loan Syndication IIL Institutional Business Retail Broking Commodity Trading Online Trading Insurance Broking9
  10. 10.  Acquired Apeejay Key Milestones Securities  Completed business restructuring  ETM as Strategic  Received the Best Investor and SAIF Performing National  Commenced equity as financial Financial Advisor  Merchant Banking broking on BSE partner Award for 2006 by and Debt on Net CNBC  ORIX & K Raheja merges with IIL  Commenced joined as new commodity  Crossed over 250 shareholders broking retail outlets spanning 125 Indian cities 1998–99 2000-2001 2003–2004 2005-2006 1999-2000 2001-2002 2004-2005 2006-2007 First full year of  Commenced  Acquired 4  Completed IPO equity broking on NSE derivative broking on branches of Tata TD NSE Waterhouse  Completed GDR Commenced retail operations at  Launched investment  Acquired Insurance  Strategic Bangalore, Chennai & advisory products Training Business investment in ESOP Kolkata Direct  Registered as Portfolio Manager10
  11. 11. Business Model Universal Broker Products Client Category Portfolio Management Services Investment Counseling HNI/MNI Mass Affluent Portfolio Advisory Retired Individuals Transaction and Corporate Distribution Products Transaction and Retail Distribution Products IIL uses the above Model to acquire and service clients11
  12. 12. Our Retail Offerings  Full Service offering across asset class Equities Investment Advisory Derivatives Portfolio Management IIL Distribution of Financial Commodities Products Depository Services Training Services Insurance Broking A Complete suite of products, offering wholesome investment Solutions12
  13. 13. Achievements Chosen as The Best Performing National Financial Advisor – Retail Segment at the CNBC TV 18 National Financial Advisor Award 200613
  14. 14. Product Offering Institutional Business Investment Banking Institutional Equity IIL Institutional Debt Broking Institutional Business IIL has a significant growing presence in the institutional capital markets in India14
  15. 15. Investment Banking Performance Parameters  Raised over Rs 14 bn from capital market through IPOs and follow-on offerings  Mobilised around 1 mn IPO applications  Acted as Advisors to 9 ESOP mandates  Executed transactions across a spectrum of industries including Logistics, Auto Ancillary, Construction, Food Processing, Media, Software, Paper, Textiles, Steel, Sugars and Shipping to name a few.  Ranked 5th in the league of Investment Bankers in No. of Book Built IPO’s executed for the year  Product reach extended with successful completion of a few M&A transactions, GDR advisory mandates and Private Equity transactions15
  16. 16. Investment Banking Execution Capabilities Initial public Offerings ESOP Buybacks Certifications Management of Private Equity Rights Issues Syndications Advisory Assignments16
  17. 17. Institutional Equity Performance Parameters  Improved Performance : Recorded a total income of Rs 139.28 mn in the current financial year compared to Rs 85.51 mn in 2004-05, a growth of 63%  Empanelments with more than 100 institutions including banks, mutual funds, FII’s and corporate treasuries. 32 new empanelments, strong traction seen  4 member sales team and 7 member sales trader team to cater to institutional clients with one dedicated team member for US, UK and South East Asia Market  Local office at Singapore  Set-up derivatives desk for Institutional Clients  Research team of 15 with a coverage of about 150 stocks17
  18. 18. Management Team Name Age Position Brief Profile Mr R. C. Bawa 52 Managing Director &  Served as Deputy MD since August 2003 CEO  Has more than 20 years of experience in Indian Banking Sector  Holds a Masters degree in Arts and post graduate diploma in Personal Management and Industrial Relationship Mr Sandeep 39 Chief Operating Officer  Served as COO since October 1999 Presswala  Has over 14 years of experience in Capital Markets  Holds a Bachelors Degree in Commerce from Bombay University and is a Chartered Accountant Mr Sachin Joshi 40 Chief Financial Officer  Served as CFO since October 1999  Has over 16 years of Financial Management experience  Holds a Bachelors degree in Commerce and is a LLB(Gen), Chartered Accountant and Cost and Works Accountants Mr Girish 37 Chief Operating Officer  Has over 15 years of industry experience in financial services Nadkarni  Holds a PGDM from IIM-A, Bachelors in Commerce from Mumbai University and is a Cost and Works Accountant18
  19. 19. Agenda Indian Financial Market Overview Company Overview Business Strategy Highlights19
  20. 20. Business Strategy OBJECTIVES STRATEGIES  Grow branch and franchisee network across India - Expand into smaller cities with significant untapped potential  Establish alliance with banks to increase market presence Grow Retail Business  Launch and grow on-line trading capabilities  Grow existing product lines like wealth management & securities related financing Sustainable Growth Drivers  Expand into related financial services such as commodities broking and financing services and insurance brokerage Capitalize on New - Established a subsidiary with membership of NCDEX & MCX Business Opportunities - Obtained a brokerage license to distribute insurance products of third party insurersGrow Institutional Brokerage  Increase institutional relationship backed by enhanced research capabilities and Merchant Banking  Harness mid-market segment witnessing robust growth  Plan to establish offices in key overseas markets, such as Singapore, Hong Targeted Presence in Key Kong, Dubai, London and New York Overseas Markets  Target growth opportunities for institutional brokering, private equity, syndication and NRI wealth management20 Capitalize on acquisition opportunities in Indian Markets
  21. 21. Growth Plan Several measures planned to sustain the growth engine  Complete business restructuring  Increase Margin Portfolio book to Rs. 7.5 bn  Accelerate branch expansion through setup of mini branches  Reach an AUM of Rs. 20 bn in MF assets  Scout for acquisitions  Strong focus on building new businesses : commodities, online trading  Launch international operations in Singapore. Complete Dubai approvals  Improve internal efficiencies : performance monitoring, operations support, development of integrated middle office trading system  Consolidate in the niche position in mid market corporate segment and graduate to large sized deals  Exploit cross – selling opportunities  Deepen the focus on research and corporate relationships to grow institutional business21
  22. 22. Network Expansion Accelerated expansion through mini branches and select franchisees planned  Rapid branch expansion on a smaller format (mini branches) planned in Mumbai, Delhi and Tier II cities  Existing franchisee relationships to be developed, growth from new franchisees to be selective Current Additional Proposed Total Branches 55 90 145 Franchisees 157 70 22722
  23. 23. Agenda Indian Financial Market Overview Company Overview Business Strategy Highlights23
  24. 24. Highlights Robust Capital Market Outlook Established Presence - Attractive Play on the Indian Securities Market Full service Investment Bank with strong retail focus Highlights Diversified Revenue Stream Strong Brand, Credibility and Innovative Product Offerings Strategic Investors With Access to Resources, Markets and Investors Strong Risk Management and Experienced and stable Management Team24