MUMBAI: The largest auto-focused non-bank lender Shriram Finance Friday reported 57 percent jump in consolidated net income at Rs 2,021.28 crore on better asset quality and stable margins coupled with higher income led by incremental loan sales in the March quarter.
Consolidated net interest income for the quarter increased 22.27 percent to Rs 5,543.47 crore as against Rs 4,533.63 crore in the same period previous year. Disbursals clipped at a tad over 15 per cent on-year.
For the full year, consolidated profit after tax increased by 20.26 to Rs 7,190.48 crore as against Rs 5,979.34 crore in the previous year.
Total assets under management increased 21.10 percent to Rs 224,862 crore compared to Rs 185,682.86 crore in March 2023 and Rs 214,233.47 crore in December, 2023.
The company saw the asset quality improving with the net bad loans ratio falling to 2.5 from 2.7 in the reporting period.
The management has recommended a final dividend of Rs 15/ share of a nominal face value of Rs 10 or 150 percent for the financial year. This is in addition to the two interim dividends of Rs 20 and Rs 10/share for the FY24 declared in October 2023 and January 2024.
With this the total dividend for the year is Rs 45/share.
The management led by Umesh Govind Revankar, the executive vice-chairman, expects to maintain same growth levels, if not less given that there is a rate cut in the second half, of this fiscal, too. “We expect the loan growth to come in at least 15 percent, which as the same as in the just concluded fiscal and also maintain stable margins at 9 percent. This optimism is based on cost of funds marginally coming down from the second half as I see a rate cut in the third quarter,” Revankar told The New Indian Express here on Friday. Of course, this depends on how the monsoons fare, he added.
On fundraising, he said to fuel a 15 percent growth we need at least Rs 30,000 crore of additional capital.
He said the company currently has borrowings/liability of Rs 42,000 crore in deposits which constitutes the largest chunk of its funding source, followed by Rs 40,000 crore of term loans from banks and other lenders, which is around 24 percent of its debt.
Then securitisation forms around 16 percent or Rs 29,00 crore, debt from capital markets by way of publicly placed and privately placed NCDs of Rs 30,000 crore or 17 percent of the total funding and external commercial borrowings comprising social bonds and social loans—of Rs 25,000 crore or 14 percent of the liabilities.