Capitaline

Results 23-Jul-24

Analysis

Mahindra & Mahindra Financial Services

AUM up 23%

Mahindra and Mahindra Financial Services (MMFSL), on a consolidated basis, has reported 39% increase in the net profit to Rs 497.66 crore in the quarter ended June 2024 (Q1FY2025). The credit cost for the company rose to 209 bps (annualized) in Q1FY2025 compared with 144 bps in preceding quarter and declined from 273 bps in the corresponding quarter last year. The net interest margin (NIM), on calculated basis, of the company declined to 6.93% in Q1FY2025 compared with 7.59% in the corresponding quarter last year.

Income from Operations increased 16% to Rs 3923.06 crore during the quarter ended June 2024, compared to the corresponding previous year quarter. Other Income jumped 61% to Rs 431.87 crore. The total Income moved up 20% to Rs 4354.93 crore, while interest expenses increased 23% to Rs 1960.33 crore in the quarter ended June 2024.

The staff cost moved up 6% to Rs 591.62 crore, while other operating expenses increased 50% to Rs 530.21 crore. The ensuing operating profit improved 13% to Rs 1272.77 crore in the quarter ended June 2024.

Depreciation rose 14% to Rs 75.82 crore during the quarter under review. Provisions & write-off declined 6% to Rs 554.55 crore. The profit before tax increased 37% to Rs 642.40 crore. After accounting for taxation of Rs 164.46 crore, net profits increased 39% to Rs 497.66 crore in the quarter ended June 2024.

Business highlights

AUM (Business assets) increased to Rs 1,06,339 crores against Rs 86,732 crores, up 23%

Disbursement: Rs 12,741 crores against Rs 12,165 crores, up 5%

Total Income increased 20% to Rs 3760 crore from Rs 3125 crore.

ontinued leadership in Passenger vehicles, Pre-owned vehicles and Tractors.

Stable Asset quality: GS2%+GS3% < 10%. Stage-3 at 3.6%.

Credit Cost:1.5% in Q1FY2025 from 2.1% in Q1FY24.

Capital Adequacy healthy at 18.5% - Tier-1 Capital at 16.4%.

Provision coverage on Stage 3 loans prudent at 59.8%.

Total liquidity buffer comfortable at Rs 8216 crore

inancial Performance FY2024:

For the year ended March 2024 (FY2024), MMFSL reported 20% rise in the Income from Operations to Rs 14412.33 crore, against the corresponding previous year period. Other Income increased 81% to Rs 1557.99 crore. As a result, the total Income grew 24% to Rs 15970.32 crore. Interest expenses moved up 37% to Rs 6959.20 crore, while the operating expenses increased 19% to Rs 4248.45 crore. Operating profits increased 13% to Rs 4762.67 crore. Depreciation increased 22% to Rs 274.85 crore, while Provisions & write-off surged 65% to Rs 1955.75 crore. PBT fell 8% to Rs 2588.13 crore. The effective tax rates stood at 25.5% in FY2024 compared with 26.5% in FY2023. Net Profit declined 7% to Rs 1932.69 crore in FY2024 over FY2023.

Mahindra & Mahindra Financial Services: Consolidated Results
Particulars	2406 (3)	2306 (3)	Var %	2403 (12)	2303 (12)	Var %
Income from operations	3923.06	3368.83	16	14412.33	12029.51	20
Other Income	431.87	268.08	61	1557.99	858.95	81
Total Income	4354.93	3636.91	20	15970.32	12888.46	24
Interest Expenses	1960.33	1597.19	23	6959.20	5094.30	37
Operating Expense	1121.83	911.51	23	4248.45	3569.11	19
Gross Profits	1272.77	1128.21	13	4762.67	4225.05	13
Depreciation / Amortization	75.82	66.36	14	274.85	225.96	22
Provisions and write off	554.55	592.82	-6	1955.75	1182.59	65
PBT before EO	642.40	469.03	37	2532.07	2816.50	-10
Extra ordinary item (EO)	0.00	0.00	-	0.00	-56.06	-100
PBT after EO	642.40	469.03	37	2532.07	2760.44	-8
Tax Expense	164.46	120.58	36	645.13	732.56	-12
Net Profit	477.94	348.45	37	1886.94	2027.88	-7
Minority Interest	-0.65	3.53	-118	10.36	-1.20	-963
P&L of Assosiate Co.	19.07	13.77	38	56.11	43.32	30
PAT	497.66	358.69	39	1932.69	2072.40	-7
EPS (Rs)*	16.1	11.6		15.7	17.1
Adj BV (Rs)	149.2	136.2		149.5	131.7
*Annualized on current equity of Rs 246.89 core excluding EO and relvant tax. Face Value: Rs 2, Figures in Rs crore
Source: Capitaline Corporate Database

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Mahindra & Mahindra Financial Services
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