Mumbai, Monday Jan 25, 2021 – ICICI Securities (I-Sec), a part of the ICICI Group and India’s leading retail-led equity franchise, distributor of financial products, and investment bank, today announced the financial results for the quarter ending 31 th December 2020 quarter (Q3 FY21).
The company reported consolidated revenue of ` 620 crore in Q3FY21, against ` 423 crore in Q3FY20, up 47%, aided by strong all round performance in equities & allied business, distribution business, private wealth management business, as well as investment banking business.
Consolidated Profit After Tax (PAT) for Q3FY21 stood at ` 267 crore, Vs ` 137 crore in Q3FY20, up 95%, on account of growth in revenue and improvement in margins.
Cost to income ratio stood at 42% in Q3FY21, against 56% in Q3FY20. Return on Equity (annualized) during the period was at robust 71%, vs 51% in Q3FY20.
I-Sec has a client base of ~5.07 million, of which over 139,000 were added during the quarter, which is highest ever addition in a quarter. Digital sourcing continues to demonstrate strength with ~ 38,000 customers added through this channel during the quarter, vs ~28,000 in Q2 and ~20,000 in Q1. Our open architecture model, where customers from any bank can trade on our platform, is also witnessing encouraging traction with about a third of new accounts being opened by non-ICICI Bank customers.
The company has over 1.63 million active clients (those who have given us revenue/transacted across any of our product categories in the last 12 months) and over 1.29 million NSE active clients (those having traded on the NSE in the last 12 months), up 17% and 34% YoY respectively. In Q3FY2021, I-Sec expanded its equity market share (by volume) by 160 bps YoY to 10.5%.
Total client assets stood at ₹ 3.4L crore# on 31st Dec, 2020, vs 2.5L crore a year ago, up 36%.
During the quarter, the company launched ICICIdirect NEO, a revolutionary and path breaking plan targeted at traders, offering unlimited trading with zero brokerage on all Futures trades, and a flat ₹20 per order for Intraday and Options trades. I-Sec also launched ‘ICICIDirect Money’ mobile app, which provides a vast array or services related to mutual funds like investment, redemption, setting up or cancelation of SIP mandates, reviewing research recommendations etc. It is witnessing healthy download traction and has high user rating.
In Q3FY21, Equities and Allied Business, which comprises retail equity, institutional equity, lending towards ESOP (Employee Stock Option Plans) & MTF (Margin Trade Funding), depository and other charges, and Prime & NEO subscription fees, rose 66% on-year to ` 428 crore. The Retail Equities and Allied Business reported revenues at ` 390 crore, up 70% vs ` 229 crore in Q3FY20. ESOP & MTF interest income rose 69% year-on-year to ` 44 crore in Q3FY21 and the average book for these businesses stood at ~ `1,840 crore as on 31th December 2020, against ~ ` 950 crore last year. Prime subscription income grew 164% YoY to ` 15 crore.
The company continues to receive encouraging response to Prime, its annual subscription based plan that provides a package of privilege pricing, exclusive research, and higher eATM (payout within 30 mins of selling stocks) limits per day. Currently there are ~ 5.3 lakh Prime subscribers and Prime and Prepaid customers contribute ~64% of retail equities revenue.
Institutional equities revenue during the quarter increased by 34% on-year to ` 38 crore on the back of established traction with in DII (Domestic Institutional Investors) space and growing traction in the FII (Foreign Institutional Investors) space.
Distribution revenue stood at ` 108 crore in Q3FY21 up 5% against Q3FY20
-Sec is India’s second largest non-bank MF distributor by revenue and assets with a 4.5% revenue market share (based on FY20 AMFI data). In spite of the mutual funds industry witnessing a decline of 7% YoY in gross equity flows along with net outflows in the equity segment, I-Sec MF revenues grew by 9% YoY to ` 63 crore in Q3FY21. On the back of SIP count rising 5% YoY to 0.68 million in Q3FY21, our market share in SIP flows has expanded to 3.66 % from 3.22% YoY, and in overall gross flows to 28 bps from 15 bps YoY. I-Sec MF AUM is up 2% YoY and is at an all-time high.
I-Sec is also a leading distribution of other financial products like loans, fixed income products, corporate bonds and deposits, insurance, bank Fixed Deposits (FD), Alternate Investment Funds (AIF), Portfolio Management Services (PMS), Sovereign Gold Bonds (SGB), and National Pension Scheme (NPS). This non-MF distribution revenue rose 5% YoY in Q3FY21 to ` 43 crore. With business environment rapidly improving, this business has made a strong comeback after a few quarters of subdued performance. Home loans disbursed during the quarter increased to ` 360 cr, which is highest ever.
As digitization of products of services picks up pace, the company has reduced the number of physical branch network to 151 in Q3FY21 vs 178 a year ago. The company has a nationwide network of 15,200+ (up 75% YoY) business partners, consisting of sub-brokers, authorized persons, IFAs & IAs, whose processes too have been digitized.
I-Sec’s Private Wealth Management (PWM) business reported ` 114 crore of revenue in Q3FY21 up 86% on-year. The PWM business is a home-grown franchise set up to service affluent customers. It serves ~ 42,700 clients, (+6,700 QoQ) with an asset base of ` 1.47 L crore# , up 45% year-on-year.
I-Sec’s proprietary Portfolio Management Scheme (PMS) AUM stood at ~ ` 170 crore as on 31th December 2020, against ~` 110 crore same period last year.
Our Issuer Services and Advisory business (Investment Banking) revenue stood at ` 23 crore in Q3FY21, up 33% on-year. I-Sec executed 10 investment banking deals during the quarter, against 7 in the corresponding quarter last year. I-sec is ranked #1 in IPO/ FPO/ InvIT/ ReIT issuance with a 85% market share (9MFY21), and #2 in Merger Market league table (amongst domestic financial advisors) by number of deals. The company has strong IPO pipeline (as per SEBI filling) of 10 deals amounting to over ` 13,800 crore.
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