The Company reported Total comprehensive income (TCI) of Rs332 crore up 33% yoy and net profit after tax of Rs330 crore up 24% yoy. Pre-provision operating profit (PPOP) was Rs674 crore. Loan growth in core products was robust — Gold loans and Home loans AUM grew by 29% and 26% y-o-y respectively. Microfinance and Business loans grew by 43% and 7% y-o-y respectively.
The Company has been on an aggressive expansion spree, adding over 200 branches and about 2,000 manpower. For many loan products, the first quarter of the financial year is seasonally slack, we expect the growth pace to accelerate. While Q1 was impacted by higher provisions for microfinance and other loans, intense competitive pressure on gold yield seems to be easing and demand for home and business loans is seeing positive traction.
Nirmal Jain, Managing Director, IIFL Finance Ltd., remarked on the financial results: “FY23 has begun well. Credit demand for retail loan products is picking up the pace. Hike in interest rate till now, has not had any significant impact on credit demand or performance. India’s macro economy has been responding positively to the interventions by government and central bank.
While good monsoon and downward trend in the commodity prices, augur well for the Indian economy, risk factors for growth continue to be inflation leading to interest rate hikes and adverse global geo- political developments.
We are excited about ADIA’s equity investment to bolster our housing finance business. Our long- term strategy of expansion of physical network and attaining digital domain depth remain on track. We are optimistic about outlook for the NBFC sector and the company’s robust competitive position in the sector.”
IIFL Finance had loan assets under management (loan AUM) of Rs52,761 crore as at June 30, 2022, with the home loans segment constituting 35%, gold loans 32%, business loans 15% and microfinance loans 12% of the total AUM.
The company’s annualized ROE and ROA for Q1FY23 stood at 20.5% and 2.9% respectively. Core pre-provision operating profit stood at Rs674 crore. for the quarter up 32% y-o-y. Average borrowing costs for the quarter declined 9 bps q-o-q and 48 bps y-o-y to 8.5%. 95% of our loans are retail in nature and 67% of our retail loans (excluding gold loans which are not classified as PSL loans) are PSL compliant. The assigned loan book stood at Rs14,577 crore.
Besides, there are securitized assets of Rs1,957 crore. Apart from securitization and assignment, we have co-lending book of Rs3,842 crore. GNPA stood at 2.6% down from 3.2% q-o-q and NNPA stood at 1.5% down from 1.8% q-o-q, as at June 30, 2022.
Business segment review
Home Loans: At the end of the quarter, retail home loan assets grew by 26% y-o-y and 5% q-o-q to Rs18,618 crore. The primary focus in this segment is on affordable and non-metro housing loans. Over 55,700 customers were benefitted with a subsidy of more than Rs1,300 crore under the Pradhan Mantri Awas Yojana — Credit Linked Subsidy Scheme.
Gold Loans: As of June 30, 2022 the gold loan AUM grew to Rs17,130 crore, showing a strong growth of 29% y-o-y and 6% q-o-q. Gold loans are provided through our widespread presence in 1,313+ cities across 22 states to salaried, self-employed and MSME customer segments.
Microfinance: The microfinance loan AUM stood at Rs6,276 crore, up 43% y-o-y and 2% q-o-q, as at June 30, 2022. The microfinance customer base stood at 17.9 lakh customers.
Business loans: Secured business loan AUM grew by 6% y-o-y to Rs5,760 crore. whereas unsecured business loan AUM grew by 12% y-o-y to Rs1,884 crore.
Construction and Real Estate: Construction and real estate AUM stood at Rs2,487 crore, down 11% y-o-y and 14% q-o-q as at June 30, 2022.
On Thursday, IIFL Finance ended at Rs352.20 per share higher by 1.94% on the BSE.
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