Five-Star Business Finance (FIVESTAR) Q4 20/21 earnings summary

Executive summary

• FY21 remained heavily affected by COVID-19, yet AUM grew 14.21% to ₹4,445.38 crore and PAT rose 37.05% to ₹358.99 crore.

• Gross Stage 3 assets improved to 1.02% from 1.37% in FY20; lending resumed in H2 after the first five months focused primarily on collections.

Financial highlights

• Operating income was ₹1,049.74 crore versus ₹786.71 crore; total income was ₹1,051.25 crore, up 33.52% YoY.

• PBT reached ₹476.44 crore, up 36.40%; PAT was ₹358.99 crore, up 37.05%; total comprehensive income was ₹358.21 crore versus ₹260.84 crore.

• Interest income rose to ₹1,014.88 crore from ₹746.82 crore; finance costs increased to ₹325.19 crore from ₹216.94 crore.

• Impairment expense was ₹35.18 crore versus ₹49.34 crore; FY21 included ₹9.97 crore of loan write-offs.

• Basic EPS was ₹140.13 versus ₹103.24; diluted EPS was ₹136.06 versus ₹100.70.

Outlook and guidance

• Plans called for continued expansion into underserved semi-urban and rural markets, alongside deeper presence in core geographies and entry into new areas.

• FY22 priorities included investment in technology, analytics, alternate data and API integration to strengthen sourcing, underwriting and collections.

• The second COVID wave was expected to affect FY22, though the impact was viewed as potentially less prolonged than the first; economic and portfolio impacts remained under monitoring.