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19 Oct 2021

ISec Q2FY22 Performance Highlights

  • Revenue at 857 crore, up 26% YoY; strong growth across all businesses
    • Equities and allied revenue at 541 crore, up 19% YoY
    • Distribution income at 151 crore, up 53% YoY
    • Private Wealth Management revenue at 232 crore up 129% YoY
    • Issuer Services & Advisory* revenue at 73 crore up 17% YoY
  • PAT at 351 crore, up 26% YoY
  • Interim dividend of 11.25 per share vs 8 in Q2FY21
  • Cost to income ratio 45%; Return on Equity (annualized) at robust 66%
  • Over 5.8 lakh clients added; up by over 400% YOY; highest ever quarterly addition
  • Total client assets at ~ 5.1 Lakh crore#, up 77% YoY
  • Wealth AUM at 2.49 Lakh crore#, up 115% YoY
  • 2.58 million overall active clients, up 65% YoY

* Our investment banking business

# Assets of our clients incl. equity demat assets maintained with ICICI Bank and excluding promoter holding

Mumbai, Tuesday, October 19, 2021 - ICICI Securities, a part of the ICICI Group and India's leading retail-led equity franchise, distributor of financial products, and investment bank, today declared all round improvement in financial and operational performance for the quarter ending 30th September 2021 (Q2FY22) as compared to the corresponding quarter last year (Q2FY21).

Q2FY22 Performance

The company reported consolidated revenue of 857 crore in Q2FY22, against 680 crore in Q2FY21, up 26%, aided by strong all round performance across business segments

Consolidated Profit After Tax (PAT) for Q2FY22 stood at 351 crore, Vs 278 crore in Q2FY21, up 26%, on account of growth in revenue and improvement in margins.

Cost to income ratio stood at 45% in Q2FY22, while Return on Equity (annualized) was at robust 66%.

The board has declared an interim dividend of 11.25 per share vs 8 in Q2FY21.

Business Highlights

ICICI Securities has a client base of ~63 lakh, of which over 5.8 lakh were added during the quarter, which is highest ever addition in a quarter. Digital sourcing and open architecture approach continue to demonstrate strength with 77% of new customers coming from non ICICI Bank channels. With the signing up with HSBC Bank during the quarter -- second such partnership agreement after Federal Bank -- to provide a seamless 3-in-1 account services to the its customers, the company has further broad-based its acquisition engine.

The company has ~2.58 million active clients (those who have transacted across any product categories in the last 12 months) and ~2.27 million NSE active clients (those having traded on the NSE in the last 12 months), up 65% and 90% YoY respectively.

Total client assets stood at 5.1 Lakh crore# on 30th September, 2021, vs 2.9 Lakh crore a year ago, up 77%.

In Q2FY22, Equities and Allied Business, which comprises retail equity, institutional equity, lending towards ESOP (Employee Stock Option Plans) & MTF (Margin Trade Funding), Prime & NEO subscription fees and other charges, rose 19% on-year to 541 crore. The Retail Equities and Allied Business reported revenues at 498 crore, up 20%, vs 416 crore in Q2FY21.

ESOP & MTF interest income rose 160% year-on-year to 116 crore in Q2FY22 and the daily average book for these businesses stood at ~ 5,150 crore for Q2FY2022, against ~ 1,810 crore for Q2FY2021. Prime subscription income grew 33% YoY to 17 crore. The company continued 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 ~ 8.7 lakh Prime subscribers (vs 4.2 lakh a year ago) and Prime and Prepaid customers together contribute 64% of retail equities revenue.

During the quarter, the company launched ICICIdirect Markets app, a brand new trading app, providing a superior trading experience with its simple, fast and intuitive UI & UX (User Interface & User Experience) design. Within a short period of time, the app has seen over 1 lakh downloads. During the quarter, the company also introduced curated portfolios of US stocks and ETFs based on models constructed by renowned global fund managers.

Institutional equities revenue during the quarter increased by 12% year-on-year to 43 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 151 crore in Q2FY22 up 53% against Q2FY21.

ICICI Securities is India's second largest non-bank MF distributor by revenue and assets. (based on FY21 AMFI data). ICICI Securities' MF revenues grew by 52% YoY to 87 crore in Q2FY22. On the back of SIP count rising 42% YoY to 0.92 million in September 2021, the company's market share in SIP flows has expanded to 4% in Q2FY22 from 3.4% in Q2FY21. ICICI Securities' MF AUM is up 37% YoY and is at an all-time high.

ICICI Securities 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 business grew by 62% YoY in Q2FY22 to 61 crore. The company's market share of SGB for Q2FY22 was 9%, and ETF (as on 30th June) was 13%. ICICIdirect disbursed 690 crore worth of loans during the quarter, against 360 crore in the same period last year. In the recent past, the company has added two new insurance principals on its platform - HDFC Life for Life Insurance and Max Bupa for Health Insurance.

I-Sec's Private Wealth Management (PWM) business reported 232 crore of revenue in Q2FY22 up 129% on-year. The PWM business is a home-grown franchise serving ~ 61,850 High Networth and Ultra High Networth (HNI/U-HNI) clients (~6,900 added during the quarter), with an asset base of 2.49 Lakh crore#, up 115% year-on-year.

# Assets of our clients incl. equity demat assets maintained with ICICI Bank and excluding promoter holding

Our Issuer Services and Advisory business (Investment Banking) revenue stood at 73 crore in Q2FY22, up 17% on-year. ICICI Securities is ranked #1 in IPO/ FPO/ InvIT/ ReIT issuance (in terms of deal count) with a deal volume market share of 52% (Q2FY22). The company has strong IPO pipeline (as per SEBI filing) of 54 deals amounting to over 1.2 lakh crore.

Management Commentary

Mr. Vijay Chandok, Managing Director and Chief Executive Officer, said, "Our strategy of broad basing our customer acquisition engine is paying off and I am happy to report highest ever quarterly customer addition yet again this quarter. During the quarter, younger millennials and Gen Z accounted for 65% of new customers (vs 39% a year ago) and those from tier II and below cities are now 84% of new customers (67% last year). We see a long growth runway, given our country's current position in the financialisation journey, expected secular long term GDP growth, large number of youth entering the job market annually and equally large number of retirees with both sets with differential needs.

From an e-broker we have evolved into a one-stop-shop for our customer's financial lifecycle journey. We are now transitioning to a digitally integrated financial marketplace. For this we are acquiring and developing relevant skill sets and also doubling down on digital investments to automate processes and use new age tools like analytics and machine learning to provide customized solutions matching customer profile, risk appetite, and goals. "

About ICICI Securities

ICICI Securities Limited (I-Sec) is a subsidiary of ICICI Bank Ltd. The company began its operation in May 1995 and continues to grow its operation through expanding its client base and providing different type of services.

I-Sec operates www.icicidirect.com, India's leading virtual financial supermarket, meeting the three need sets of its clients- investments, protection, and borrowing. Through its four lines of businesses -- broking, distribution of financial products, wealth management and investment banking-- I-Sec serves customers ranging from the retail and institutional investors to corporates to high net-worth individuals to government.

I-Sec is listed on National Stock Exchange (NSE) and the Bombay Stock Exchange (BSE). For details, visit: www.icicisecurities.com

Disclaimer

Except for the historical information contained herein, statements in this release which contain words or phrases such as 'will', 'expected to', etc., and similar expressions or variations of such expressions may constitute 'forward-looking statements'. These forward-looking statements involve a number of risks, uncertainties and other factors that could cause actual results, opportunities and growth potential to differ materially from those suggested by the forward-looking statements. These risks and uncertainties include, but are not limited to, the actual growth in broking business and other financial services in the countries that we operate or where a material number of our customers reside, our ability to successfully implement our strategy, including our use of the Internet and other technology our exploration of merger and acquisition opportunities, our ability to integrate mergers or acquisitions into our operations and manage the risks associated with such acquisitions to achieve our strategic and financial objectives, our growth and expansion in domestic and overseas markets, technological changes, our ability to market new products, the outcome of any legal, tax or regulatory proceedings in India and in other jurisdictions we are or become a party to, the future impact of new accounting standards, our ability to implement our dividend policy, the impact of changes in insurance regulations and other regulatory changes in India and other jurisdictions on us. ICICI Securities Limited undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date thereof.

For further details, contact:

ICICI Securities Ltd.
Rabin Ghosh
rabin.ghosh@icicisecurities.com
Adfactors PR Ltd.
Rasika Badshah
rasika.badshah@adfactorspr.com
+91 9821631379