Edelweiss Financial Services (EDELWEISS) Q1 24/25 earnings summary

Executive summary

• Consolidated PAT for Q1 rose 17% year-over-year to INR 59 crore; ex-insurance PAT at INR 107 crore, with net worth at INR 6,052 crore and strong customer asset growth.

• Net debt reduced by INR 2,670 crore year-over-year to INR 12,700 crore, with significant deleveraging since 2019.

• Strategic focus on unbundling businesses, value unlocking through Nuvama demerger, and ongoing EAAA stake sale process.

• Customer reach expanded 38% year-over-year to 8.2 million, and customer assets grew 13% year-over-year to INR 2.2 lakh crore.

• Appointment of Mr. C. Balagopal as Independent Director for a 5-year term.

Financial highlights

• Alternative Asset Management AUM up 17% year-over-year to INR 56,350 crore; PAT up 44% year-over-year to INR 66 crore.

• Mutual Fund AUM up 24% year-over-year to INR 1,36,000 crore; equity AUM up 71% year-over-year; retail folios up 45% year-over-year.

• General Insurance gross written premium up 56% year-over-year to INR 236 crore; Life Insurance gross premium up 10% year-over-year to INR 275 crore.

• NBFC retail disbursals up 24% year-over-year to INR 200 crore; Housing Finance disbursals up 80% year-over-year to INR 320 crore.

• Asset Reconstruction business PAT up 6% year-over-year to INR 85 crore; recovered INR 1,332 crore in Q1.

Outlook and guidance

• Continued focus on unlocking value in all businesses, with EAAA stake sale decision expected by September 30 and further debt reduction targeted.

• Life insurance business remains on track for break-even by FY27, with focus on traditional products and VNB margin.

• Management remains confident in leveraging India's economic growth and sectoral drivers.

• Expect slower credit and ARC business growth in coming quarters due to RBI orders, but long-term outlook remains positive.