IIFL Finance (IIFL) Q4 08/09 earnings summary

Executive summary

• Consolidated income fell 5.9% YoY to Rs 9,630.9m; profit after tax before exceptional items declined 4.0% to Rs 1,573.4m.

• Broking remained the largest revenue stream, while financing and investment income grew 37.0% YoY and commodities broking income rose 30.8%.

Financial highlights

• Consolidated profit before interest, depreciation and tax was Rs 2,922.7m, versus Rs 4,022.2m in FY 2007-08.

• Standalone gross total income was Rs 5,716.0m versus Rs 6,724.4m; standalone net profit was Rs 1,058.2m versus Rs 1,577.3m.

• Consolidated basic EPS before exceptional items was Rs 5.07 versus Rs 7.13; diluted EPS was Rs 4.76 versus Rs 5.91.

Outlook and guidance

• Management viewed medium- to long-term prospects in India positively, citing a stable central government and increased FII confidence in India as an investment destination.

• The diversified, one-stop financial services model and investment in technology and research were positioned to capture more of the advice-to-execution value chain at lower delivery cost.

• Global financial services conditions remained uncertain after the 2008 crisis; management cautioned that it was too early to assess whether systemic risks had passed.