Fedbank Financial Services (FEDFINA) Q3 24/25 earnings summary

Executive summary

• Q3 FY25 AUM reached ₹14,922 crore, up 39.3% YoY; disbursements rose 31.4% to ₹4,395 crore.

• Net profit fell 71.3% YoY to ₹18.8 crore after a ₹75.5 crore one-time provision; NII rose 31.0% to ₹283.8 crore and operating profit rose 30.9% to ₹144.6 crore.

• Mortgage delinquencies and delayed NPA recoveries prompted tighter underwriting, stronger collections and elevated provisioning.

Financial highlights

• Total income was ₹543.0 crore, up 26.5% YoY; net total income reached ₹321.8 crore, up 26.8% YoY.

• Core NII rose 32.2% YoY to ₹264.5 crore; net gain on direct assignment was ₹19.3 crore and other income was ₹38.0 crore.

• Operating expenses were ₹177.2 crore, up 23.7% YoY; pre-provisioning operating profit was ₹144.6 crore, up 30.9% YoY.

• Q3 impairment expense was ₹119.57 crore, versus ₹22.66 crore YoY and ₹39.86 crore QoQ.

• Nine-month net profit was ₹15,353 lakh versus ₹17,705 lakh; basic EPS was ₹4.14 versus ₹5.39.

Outlook and guidance

• Q4 FY25 credit cost is expected to remain below 1%; management expects a more predictable cost trajectory as business-loan exposure slows.

• Business loans are expected to decline from 12% of loans to 5% over the next year; gold is expected to remain 30%–40% of the portfolio.

• Small-ticket LAP is planned as a faster-growing pivot business, with investment in people, processes, technology and collections; management expects stress to pull back from Q1.

• Cost-to-income improvement is a FY26 priority; specific ROA/ROE targets were deferred, with strategy to be calibrated quarter by quarter.