Conservative proactive measures have always complemented PEL’s bold strategic decisions, which enabled the Company navigate through challenging business environments.
Some of these proactive measures generally taken by the Company include:
Always maintained low leverage in the Financial Services business and allocated significant capital of ~`5,000 Crores to the business post the ~`7,000 Crore fund-raise in FY2018
Created independent risk and legal teams reporting directly to the Board
Unique asset monitoring process, that gives early warning signals
Maintained conservative provisioning despite healthy asset quality – 1.9% of overall loan book vs. GNPA ratio of 0.9%; 224% PCR1 - higher than top players in the industry
Proactively improved borrowing mix, by reducing share of CPs over the last 6 months from `18,000 Crores as on Sep-2018 to `8,900 Crores as on Mar- 2019
Nurtured a strong quality-driven culture in the Pharma business and hence, successfully completed 33 USFDA inspections
Periodic portfolio stress test – identified 18 deals and addressed potential asset quality stress under hypothetical, worst-case scenarios
Note: 1. PCR - Provision Coverage Ratio
Sensitivity Analysis: Residential Real Estate Portfolio
Even in the hypothetical worst case scenario, only 18 of 242 deals required ‘proactive measures’
Factors considered for sensitivity analysis: