Capitaline

Results 27-Apr-24

Analysis

Shriram Finance

Strong loan growth, healthy asset quality and margins

Shriram Finance has posted robust 57% surge in the net profit to Rs 2008.80 crore on consolidated basis in the quarter ended March 2024 (Q4FY2024). The company has improved the net interest margin to 9.02% in Q4FY2024 from 8.93% in the previous quarter and 8.52% in the corresponding quarter last year. The net interest income (NII) of the company increased 20% yoy to Rs 5336.06 crore in Q4FY2024.

The company has also maintained strong and steady loan growth at 21% at end March 2024. The Asset under Management (AUM) increased 21% to Rs 224862 crore at end March 2024. Further, the company has exhibited an improvement in the asset quality, while reducing the NNPA ratio in Q4FY2024.

Shriram Transport Finance Company reported 24% rise in Income from operations at Rs 9400.13 crore on a consolidated basis. Other income jumped 37% to Rs 518.17 crore compared with Rs 379.50 crore in Q4FY2023. The total income moved up 24% to Rs 9918.30 crore.

Interest expense increased 25% to Rs 4197.46 crore, while other expenses rose 34% to Rs 1553.87 crore. Ensuing Gross profit increased 20% to Rs 4166.97 crore.

Depreciation declined -63% to Rs 159.11 crore, while provision and write offs rose 7% to Rs 1265.01 crore. PBT moved up 48% to Rs 2742.85 crore.

Effective tax rate declined to 26.4% compared to 30.6% in the corresponding period last year. The share of profit of associate declined 6% to Rs 2.95 crore. The final bottomline of the company improved 56% to Rs 2008.80 crore in Q4FY2024.

Business performance and Asset quality

AUM of the company increased 21% yoy to Rs 224862 crore end March 2024. The commercial vehicle loan book increased 15% yoy to Rs 106935 crore, passenger vehicle 28% to Rs 43196 crore, construction equipment 18% to Rs 16954 crore, farm equipment 7% to Rs 3715 crore, MSME 37% to Rs 26227 crore, two wheelers 21% to Rs 12552 crore, gold 41% to Rs 6300 crore and personal loans 35% to Rs 8982 crore end March 2024 over March 2023.

The borrowings of the company increased 18% to Rs 185840 crore end March 2024.

The branch network of the company stood at 3082 branches with 8.39 million customers at end March 2024. The employee count of the company stood at 74645 employees at end March 2024.

The gross stage 3 assets ratio declined to 5.45% at end March 2024 and Net NPA ratio fell to 2.70% at end March 2024. The company has maintained NPA coverage ratio at 51.79% at end March 2024.

Book value of the company on a consolidated basis stood at Rs 1289.7 per share at end March 2024. The adjusted book value increased to Rs 1134.7 per share at end March 2024.

Financial Performance FY2024

For the year ended March 2024 (FY2024), Shriram Transport Finance Company reported 19% rise in Income from operations at Rs 34698.41 crore. Other income increased 32% to Rs 1714.58 crore compared with Rs 1302.52 crore in FY2023. The total income moved up 19% to Rs 36412.99 crore.

Interest expense increased 20% to Rs 15521.76 crore, while other expenses rose 26% to Rs 5791.13 crore. Ensuing Gross profit increased 16% to Rs 15100.10 crore.

Depreciation declined -2% to Rs 587.60 crore, while provision and write offs moved up 9% to Rs 4552.33 crore. PBT increased 21% to Rs 9960.17 crore.

Effective tax rate stood at 25.8% compared to 26.8% in the corresponding period last year. The share of profit of associate declined -9% to Rs 7.78 crore. The final bottomline of the company improved 23% to Rs 7366.38 crore in FY2024.

Shriram Finance: Consolidated Results
Particulars	2403 (3)	2303 (3)	Var %	2403 (12)	2303 (12)	Var %
Income from operations	9400.13	7600.25	24	34698.41	29205.87	19
Other Income	518.17	379.50	37	1714.58	1302.52	32
Total Income	9918.30	7979.75	24	36412.99	30508.39	19
Interest Expenses	4197.46	3361.23	25	15521.76	12931.27	20
Other expenses	1553.87	1155.33	34	5791.13	4593.65	26
Gross profit	4166.97	3463.19	20	15100.10	12983.47	16
Depreciation	159.11	427.09	-63	587.60	600.69	-2
Profit before tax and Provisions	4007.86	3036.10	32	14512.50	12382.78	17
Provisions and write off	1265.01	1185.36	7	4552.33	4169.06	9
Profit before tax	2742.85	1850.74	48	9960.17	8213.72	21
Provision for tax	724.52	565.70	28	2569.06	2202.25	17
Net profit	2018.33	1285.04	57	7391.11	6011.47	23
Share of profit/loss of associate	2.95	3.14	-6	7.78	8.56	-9
Minority interst	12.48	2.99	317	32.51	8.99	262
PAT	2008.80	1285.19	56	7366.38	6011.04	23
EPS*(Rs)	213.8	136.8		196.0	160.0
Adj BV (Rs)	1134.7	1002.3		1134.7	1002.3
* Annualized on current equity of Rs 375.79 crore. Face Value: Rs 10, Figures in Rs Crore
Source: Capitaline Corporate Database

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