ICICI Securities July 23, 2020 National Stock Exchange of India Limited Listing Department Exchange Plaza, C-1, Block G, Bandra Kurla. Complex, Bandra (E), Mumbai - 400 051 BSE Limited Listing Department Phiroze Jeejeebhoy Towers, Dalal Street, Mumbai - 400 001 Dear Sir/Madam, Sub: Outcome of earnings call held for results for the quarter ended June 30, 2020 Ref: NSE Symbol - ISEC and BSE Scrip Code - 541179 This is further to our letter dated July 18, 2020 regarding the earnings call which was scheduled to be held on July 22, 2020. Please find enclosed herewith the investor presentation and the opening remarks for the earnings call held on July 22, 2020 to discuss the financial results for the quarter ended June 30, 2020. The same has also been uploaded on the website of the Company i.e. www.icicisecurities.com. Thanking you, Yours faithfully, For ICICI Securities Limited ~~ -- , upesh Jadhav Senior Manager Enc!.: As above Member of National Stock Exchange of India Ltd. BSE Ltd and Metropolitan Stock Exchange of India ltd. SEBI Registration : INZ000183631 CIN No.: L67120MH1995PLC086241 ,ICICI Securities Limited Registered Office (Institutional): ICICI Centre, H. T. Parekh Marg, Church gate, Mumbai 400 020, India. Tel (91 22) 2288 2460nO Fax (91 22) 2282 6580 Corporate Office (Retail): Shree Sawan Knowledge Park, Plot No. 0-507, T.T.C. Ind. Area, M.I.O.C,Turbhe, Navi Mumbai - 400 705 Tel (91 22) 4070 1000 Fax (91 22) 4070 1022 Name of Compliance Officer (Broking Operations) : Mr. Anoop Goyal Email Address.:[email protected]/Tel (9122) 40701000 Website Address: www.icicisecurities.com / www.icicidirect.com EMPOWE~INO ifl-.'ESTORS f\t.EIHlnltitti'{e
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ICICI SecuritiesJuly 23, 2020
National Stock Exchange of India LimitedListing DepartmentExchange Plaza, C-1, Block G,Bandra Kurla. Complex,Bandra (E), Mumbai - 400 051
Sub: Outcome of earnings call held for results for the quarter endedJune 30, 2020
Ref: NSE Symbol - ISEC and BSE Scrip Code - 541179
This is further to our letter dated July 18, 2020 regarding the earnings call whichwas scheduled to be held on July 22, 2020.
Please find enclosed herewith the investor presentation and the opening remarksfor the earnings call held on July 22, 2020 to discuss the financial results for thequarter ended June 30, 2020.
The same has also been uploaded on the website of the Companyi.e. www.icicisecurities.com.
Thanking you,
Yours faithfully,For ICICI Securities Limited
~~ --
, upesh JadhavSenior Manager
Enc!.: As above
Member of National Stock Exchange of India Ltd. BSE Ltd and Metropolitan Stock Exchange of India ltd.SEBI Registration : INZ000183631CIN No.: L67120MH1995PLC086241
, ICICI Securities LimitedRegistered Office (Institutional):ICICI Centre, H. T. Parekh Marg,Church gate, Mumbai 400 020, India.Tel (91 22) 2288 2460nOFax (91 22) 2282 6580
1. As at Q1-FY21, Active clients are for trailing 12 months 2. FY20 data, Source AMFI 3. ECM market share source Prime Database
* Assets of our clients including equity demat assets maintained with ICICI Bank and excluding promoter holding
** Assets of our clients with more than 1 cr AUM at individual level including equity demat assets maintained with ICICI Bank and excluding promoter holding
…a sticky, diverse & multifaceted client base…
4
37% of clients active more than 14 years ago are still active with us
>65% revenues in each of financial years (FY14 to FY20) was contributed by customers
who have been with us for more than 5 years1
In last 3 years millennials form 70% of active customers
0.95 mn clients2
with 2 or more products, up from 0.58 mn in FY16
1. Based on retail broking revenues
2. As at Q1-FY21
Not only are we able to attract millennials
but also able to retain our vintage clients
…on back of strong Cultural Anchors, …
5
Strong
customer
focusCultural
Anchors
InnovationNurturing
Talent
Agility
&
Execution
Governance
& Risk
Management
ISec is a 20 year old Company
but a 5 year young Enterprise
Multiple first to market offerings
Catering to Life cycle
Financial needs of
customers
Nuanced insights of
customer behaviour
Nurturing high quality, diverse
talent pool with an ability to
attract & retain talent
Ability to respond and react
quickly to any situation
Strong emphasis on rapid
execution
Independent Chairman
Separate posts of Chairman & MD/CEO
Board governed company with strong
Independent director representation
Proactive and real-time risk
management
…a robust business model enjoying strong brand equity
6
Strong Digital
Platform
Wide range of products under one digital platform
Investments, debt, deposits and protection
Product offering of 45+ products and services
Scalable digital capabilities and infrastructure
97% equity transactions performed online
94% mutual fund transactions performed online
Prudent Risk Management with real time monitoring
4* rating for our Mobile App on Google Playstore
Resilient
Business model
Low credit and receivables risk
Virtually no inventory and supply chain risk
Strong liquidity position
High Return on Equity
Asset light model
Agenda
• ISEC Franchise
• Strategy
• Financial Results
• Business Performance
Broadening the positioning by focusing on strategic anchors
To emerge as a provider of life stage financial services requirements of Retail Indian -
Powered digitally
Imperatives:
• Broad basing business model
• Diverse and granular revenue streams
Protection
Wealth &
Investments
8
Assets &
Loans
Distribution
Focus on our strategic anchors have enabled us to
outperform in uncertain environment
• Ramping up scale and value have improved our quality and speed of sourcing through
digital channels and growth in partnerships with ecosystem players
• Offering an enhanced product suite for our retail and HNI clients and strengthening our wealth
management franchise has helped us monetize client value
• Active customer engagement has enabled us to offer customized products thereby
deepening relationships and increasing cross sell ratio
• Digital agility and Robust technology has helped us grow speed of client engagement
across platforms
• Our focus on cost efficiency has helped us improve operating leverage
9
Multichannel open architecture has led to improvement in
quality of sourcing…
Quality of Sourcing
10
Activation rates = % of New client acquisition (NCA) who have traded during the quarter
1. Total client base with the company
2. Overall active clients are the clients who have transacted at least once during trailing 12 months across all product categories
3. NSE active client base are the clients who have traded at least once during trailing 12 months
Digital Sourcing Business Partners
Diversified our client sourcing
channel mix, largest sourcing
channel now contributing about
65% vs 80% in FY20
20,000+ accounts sourced
digitally
Non digital sourced accounts
also opened digitally amidst
lockdown
0.10
0.16
0.24
0.32
0.38
Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21
Prime customer base (mn)
34%
44%
57%
68%
58%
Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21
Activation rates
7,500+8,000+
8,600+9,400+
12,100+
16% 23% 45% 73% 266%
Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21
Business partner network NCA* (% chg)
Partnership with ecosystem
players for client acquisition
Client Base1: 4.9m, +7% Overall Active
2: 1.5m, +15% NSE Active
3: 1.1m, +27%
…which has resulted in increase in market share
Equity market share1
up 260 bps
Derivative market share1
up 150 bps
8.1%
7.4%
9.1
%
8.0
%10
.7
%
8.9
%Equity Derivative
Q1 FY20 Q4 FY20 Q1 FY21
11
1. Combined market share for retail and institutional clients
Period: Q1-FY2021 vs Q1-FY2020, Source: NSE, BSE
Volume Market Share Rolling 12 Month - NSE Active Clients (mn)
0.88
0.91
0.96
1.01
1.07
1.12
Ap
r-19
May-1
9
Ju
n-19
Ju
l-19
Au
g-19
Sep
-19
Oct-19
No
v-19
Dec-19
Jan
-20
Feb
-20
Mar-20
Ap
r-20
May-2
0
Ju
n-20
NSE Active market share at 9.2%
Enhanced product suite strengthening our offer to clients and
increasing long term revenue
MTF & ESOP book* (` bn)
12
5.36.8
11.5
5.8
15.0
Q1 FY20 Q2 FY20 Q3 FY20 Q4 FY20 Q1 FY21
55 68 109 159 192 178 204 204
346395
574
747798
654
784 793401
463
683
906990
832
988 997
FY15 FY16 FY17 FY18 FY19 FY20 Q1
FY20
Q1
FY21
Recurring Transactional
Wealth Management Assets (` bn)
0.62 0.46
0.89
1.33 1.36 1.51
0.36 0.37
0.72 0.70
0.81
1.03 0.82
1.08
0.210.40
1.34 1.17
1.71
2.36
2.18
2.59
0.57
0.77
0.76%
1.01% 0.99%
0.77% 0.82%0.72%
0.77%
0.19% 0.17% 0.16% 0.11% 0.15% 0.11%0.22%
0.27% 0.30% 0.30%0.23%
0.28%0.23%
0.34%
-3.00%
-2.50%
-2.00%
-1.50%
-1.00%
-0.50%
0.00%
0.50%
1.00%
-
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
4.50
5.00
FY15 FY16 FY17 FY18 FY19 FY20 Q1
FY20
Q1
FY21
Recurring Transactional
Yield on Recurring Assets Yield on Transactional Assets
Yield on Total AUM
Wealth Management Revenue (` bn)
*Funded value at the end of the period
Yields are on average assets for the current & preceding period
Quarterly yields are annualized
Deepening relationships
to enhance life time value
Increase cross sell ratio
Win back clients who have
stopped trading
Activate clients who have
never traded
Our key initiatives and diverse array of solutions is helping
deepen client relationships…
Identify transaction behavior
Over 400 product combinations formed, top 23 clusters
identified for personalization
Use inputs to target clients for better quality acquisition
and to enhance engagement
Make product experience for the customer unique to usage
eATM, Option pricing plan (Option 20)
66% growth in option unique traded customers Y-o-Y
Total operational expenses 2,083 2,454 2,641 8% 27%
Finance Cost 178 288 229 (20)% 29%
Total expenses 2,261 2,742 2,870 5% 27%
Profit before tax 1,760 2,077 2,594 25% 47%
Tax 622 518 663 28% 7%
Profit after tax 1,138 1,559 1,931 24% 70%
Other Comprehensive Income (OCI) (35) (19) 2 - -
Total Comprehensive Income (TCI) 1,103 1,540 1,933 26% 75%
Segment performance
30
(` million)
The group operating segment's nomenclature has been changed for better representation to the stakeholders, the classification of segment allocation has remain
unchanged.
1. Broking & Distribution from erstwhile Broking & commission
2. Issuer services & advisory from erstwhile Advisory services. Includes Financial advisory services such as equity-debt issue management services, merger
and acquisition advice and other related activities
3. Treasury from erstwhile Investment & trading
Amount of ` 148 mn pertaining to interest on income tax refund is not allocated to any segment and is included in total revenues and results of Q1-FY2020 &
FY2020 Period: Q-o-Q: Q1-FY2021 vs Q4-FY2020; Y-o-Y: Q1-FY2021 vs Q1-FY2020