Max India Limited Investor Presentation November, 2014 - PowerPoint PPT Presentation

Max India Limited Investor Presentation November, 2014 www.maxindia.com BSE Scrip Code: 500271, NSE Ticker: MAX, Bloomberg: MAX:IN 1

MAX GROUP - OVERVIEW www.maxindia.com 2

Max Group Vision “To be the most admired corporate for service excellence” • Positive social impact • Culture of Service Sevabhav • Helpfulness • Mindfulness • Expertise • Entrepreneurship Excellence • Dependability • Business performance • Transparency • Respect Credibility • Integrity • Governance 3

Our Businesses Multi-business corporate Focused on people and service “ IN THE BUSINESS OF LIFE ” Life Insurance Healthcare Health Insurance Senior Living Protecting Life Caring for Life Enhancing Life 100% Owned; Continuing Care 74:26 JV* with Mitsui 74:26 JV with BUPA Equal JV^ with Life Retirement Community in Sumitomo; Healthcare, SA; Finance Plc, UK Dehradun Largest non bank lead 2,000 beds private life insurer Speciality Films Corporate Social Responsibility Clinical Research 100% owned; Niche high barrier polymer films & Leather Focus on healthcare, children and the 557 active sites Finishing Foils environment *Max India currently holds 71.1% in Max Life 4 ^Current holding in MHC is Max India-46%, Life Healthcare-46% and IFC-7.5%

A unique investment opportunity and a resilient business model INR 116 billion+ Revenues*..INR 100 billion+ MCap.. 5 Mn+ Customers..15,000 Employees.. 1 55,000+^ Agents.. 2,100+ Doctors 2 Strong growth trajectory even in challenging times; a resilient & diversified business model 3 Steady revenue growth and cost rationalization leads to strong financial performance Well established board governance….internationally acclaimed domain experts inducted 4 Diversified ownership…..marquee investor base 5 6 Superior brand recall with a proven track record of service excellence 7 Strong history of entrepreneurship and nurturing successful business partnerships Electronic Mobile Communication Plating Medical Life Pharma Component Telephony Services Chemicals Transcription Insurance COMSAT Hutchison ATOTECH *Total Revenue for FY14, 5 ^Across Life and Health Insurance

Growth potential recognized by the market…. high pedigree investor base Shareholding Pattern as on Sep 30, 2014 Others 8.7% Mutual • Reliance MF Funds • Temasek 11.2% Shareholding • Fidelity Promoters • Norges Concentrated 40.5% • New York Life with Marquee • Jupiter • GIC Investors FII (Others) • ICICI Prudential 21.0% • Comgest IFC 3.1% Goldman Sachs 15.5% Number of outstanding shares : 26.55 Cr. 6

Consistent track record of strong growth across businesses with the group turning strong profits Rs Cr. Rs Cr. Operating Revenue Trend FY 10 FY 11 FY 12 FY 13 FY 14 10000 Operating 8000 5,574 6,668 7,648 8,180 9,139 Revenue 6000 Investment and 2,087 1,223 914 2,444 2,544 9139 Other Income 8180 4000 7643 6668 5574 Total Revenue 7,661 7,891 8,562 10,624 11,683 4508 2000 Profit / (Loss) (86) 32 242 991* 274 0 before Tax FY 09 FY10 FY11 FY12 FY 13 FY14 Rs Cr. Profitability Trend FY 10 FY 11 FY 12 FY 13 FY 14 400 300 1,993 1,944 2,513 2,903 2,984 Net Worth 200 274 242 32 440 507 549 676 702 Loan Funds 100 197 0 Net Fixed 965 1,017 1,256 1,361 1,495 -100 Assets (86) -200 Treasury 909 540 397 409 235 -300 Corpus -400 (333) FY 09 FY10 FY11 FY12 FY 13 FY 14 10,121 13,836 17,215 20,458 24,716 Life Ins. AUM 7 * Investment & Other Income and PBT for FY13 includes income from stake sale in Max Life amounting to Rs. 802 Cr and Rs.794 Cr, respectively. However, PBT for FY13 has been appropriately adjusted in the chart to reflect proper trends

MAX LIFE INSURANCE COMPANY (Max Life) www.maxnewyorklife.com 8

The Essence of our chosen Strategy Our objective To be the most admired life insurance Sources of competitive advantage company in India with sharp focus on financial metrics ”Build a robust multi - channel distribution architecture while Max Our approach To serve the long-term savings and Life’s proprietary high protection needs of mass affluent+ quality agency will customers through a high quality agency remain the core distribution channel.” supplemented by our privileged bancassurance partnership Key choices RECREATE GROW TURBOCHARGE OPPORTUNISTIC REDUCE  High quality  Privileged banc-  Product  New PD deals  Cost “platinum assurance development  Group business – Driving cost standard” agency relationship with process management  Discover growth that we were Axis Bank  Change – known for options for the Lowering  Expand management and future costs of bancassurance governance agency  Persistency management 9

Product Mix of top insurers observed steering towards a linked heavy portfolio driven by buoyancy in equity markets H1 FY - 2014 H1 FY - 2015 Par Non Par ULIP 3% ICICI Pru 37% 60% 16% 82% 2% HDFC Life 40% 9% 51% 27% 20% 53% SBI 27% 35% 38% 51% 14% 35% Max Life 11% 4% 68% 21% 63% 34% Birla Sunlife 56% 40% 45% 23% 32% 4% Kotak Life 18% 40% 42% 20% 41% 39% K EY I NSIGHTS ICICI Prudential is one of the top insurers to have witnessed a sharp rise in UL design products. Also, the PAR segment has gained traction primarily filling the void left by index linked plans (since Sep 30th) HDFC Life’s NPar segment has picked up with online term product showing great potential. High ULIP share is attributed to it’ s high dependence on the Banca channel (66% FYP share in H1 FY15) SBI Life’s non - par segment has shrunk as it’s top selling NPar products - ‘Flexi - Smart’ and ‘ Subh Nivesh ’ are now being sold as PAR products Birla Sunlife’s vision series (Vision life/income etc) has lifted the Par contribution. ULIP share to decrease going forward with the exit of C itibank in Q2’14 Max Life saw a surge in UL sales on account of buoyant equity markets 10 SOURCE: Market Intelligence & Internal Estimates | Public Disclosures

Max Life continues to perform better than the top private insurers on agency efficiency parameters Average Branch Productivity Average Agent Productivity In Rs. Lakhs per month In Rs. 000's per month 9.7 1,735 Max Life 1,696 8.6 Industry Productivity solutions through Performance 897 6.5 various bets by most insurers has led SBI Life 1,147 7.9 to improved agent productivity in Q1’FY 15; though decline in case rate 801 3.0 ICICI Pru 956 3.4 568 3.5 Kotak Life Max Life’s 675 Max Life continued to lead 3.5 Performance productivity parameters (both agent 524 3.5 productivity and branch productivity) HDFC Life 671 5.1 557 3.2 Birla Sunlife 530 3.2 Q1 FY 14 Q1 FY 15 Note: Agency productivity calculated using FYP (100% SP) 11 SOURCE: Market Intelligence & Internal Estimates | Public Disclosures

Max Life well positioned for the transformation  Agency base at ~44,500 agents Highly productive agency  H1FY15 Average case size at ~Rs. 31,000 with average case rate ~0.30 model and best in class  Need based insurance sales training  400+ trainers on board Comprehensive product  Product mix for H1FY15: Par 63%, Non-par 3%, ULIP 34% portfolio with an enduring  Long tenor products (20 Yr) & a young customer profile (35 Yr) customer base  Embedded Value; EV for FY14 at Rs. 3,953 Cr, operating RoEV of 15.6% Disclosures ahead of competition  Implied NBM is 13.4% on APE* for FY14 (FY13 at 14%)  Max Life’s share of private sector for H1FY15 at 10.7% (H1FY14 -10.4%)  Assets under Management at Rs. 28,038 Cr. as at Sep 30, 2014, grow 29% y-o-y  Over 3.6 million polices in-force with Sum assured over Rs. 200,000 Cr. Other key drivers  Business capitalised at Rs. 2,127 Cr. as at Sep 30, 2014; solvency surplus of Rs. 2,254 Cr. and solvency margin of 475%  Paid Dividend for H1FY15 of Rs.150 Cr post DDT (PY Rs.128 Cr) *APE – Adjusted Premium Equivalent (Annualized First Year Premium adjusted for 10% of Single Premium). 12

Track record of strong performance Renewal premium and conservation ratio 2 New Business Growth – Adjusted FYP 1 and AUM 1800 30000 6000 90% 1724 1769 1700 25000 5000 83% 82% 20458 81% 81% 80% 1595 1584 24716 78% 1600 20000 4000 17215 1506 1513 13836 1500 15000 3000 60% 10,121 1400 10000 2000 5405 1300 5000 1000 2014 3011 3751 4489 4739 5017 1200 0 0 30% FY 09 FY10 FY11 FY12 FY 13 FY 14 FY 09 FY10 FY11 FY12 FY 13 FY 14 AFYP (Rs cr) AUM (Rs cr) Renewal Premium (Rs cr) Conservation Ratio In force business and No. of policies Distribution Mix 100% 250 5 4.5 29% 34% 36% 3.5 3.6 80% 200 4 3.5 3.4 50% 3.5 8% 71% 75% 8% 2.6 60% 150 3 3.0 14% 2.5 200 152 40% 100 2 22% 53% 155 169 49% 41% 1.5 94 123 20% 50 1 22% 23% 22% 0.5 4% 10% 9% 9% 6% 3% 3% 0% 1% 0 0 FY09 FY10 FY11 FY12 FY13 FY14 FY 09 FY10 FY11 FY12 FY 13 FY 14 Group Bancassurance Partnership Distribution Own Channel Sum Asssured (Rs 000's cr) Policies million 1. Individual First Year Premium adjusted for 10% single pay 13 2. Conservation ratio = Renewal premium for the current period / (First Year + Renewal Premium for the previous period)