Cholamandalam Investment and Finance Company (511243) Q2 26/27 earnings summary

Executive summary

• Q2 FY27 disbursements rose 47% YoY to ₹35,872 crore; AUM reached ₹2,68,009 crore, up 25%, and PAT increased 41% to ₹1,630 crore.

• H1 disbursements grew 34% to ₹65,484 crore; PBT rose 43% to ₹4,409 crore and PAT rose 43% to ₹3,284 crore.

Financial highlights

• Q2 total income rose 23% YoY to ₹9,367 crore and net income increased 24% to ₹5,037 crore; Q2 PBT rose 40% to ₹2,188 crore.

• Q2 expenses increased 22% to ₹1,975 crore, while net credit losses declined 3% to ₹874 crore; H1 net income rose 26% to ₹9,967 crore.

• H1 total income rose 23% to ₹18,300 crore and PBT increased 43% to ₹4,409 crore; reported H1 ROE was 20.3%.

Outlook and guidance

• FY growth guidance remained 20%-23% on a steady-state basis; management said initial targets of 25% growth and 1.4% net credit cost had been achieved at H1, with H2 potentially stronger.

• Management expected seasonally stronger H2 performance, with growth rates potentially moderating against a stronger base; October vehicle disbursements were up 18%-20% YoY.

• CSEL unsecured business loans and consumer durable/digital lending were delivering close to 3.6% ROA, with combined pretax ROA expected to exceed 4%.

• Floating-rate books, including affordable housing, LAP and SME, were expected to be repriced in Q3; aggregate yield could decline at least 10 bps as funding costs rise.

• Affordable housing finance AUM was expected to grow 19%-21% in FY27; management expected mortgage businesses to gain share over 3-4 years.