SBFC Finance (SBFC) Q3 24/25 earnings summary

Executive summary

• AUM reached ₹8,148 crore as of December 2024, up 30% year-over-year and 6% quarter-on-quarter, with 99% secured by property and gold.

• Profit after tax for Q3 FY25 was ₹88 crore, up 38% year-over-year and 5% quarter-on-quarter; nine-month profit exceeded the previous full year.

• Branch network expanded by five during the quarter, totaling 197 branches across 16 states and 2 UTs.

• Unaudited standalone and consolidated financial results for the quarter and nine months ended 31 December 2024 were approved, reflecting continued growth in revenue and profitability.

• Statutory auditors issued unmodified limited review reports for both standalone and consolidated results, indicating no material misstatements.

Financial highlights

• Total income for Q3 FY25 was ₹333 crore, up 26.2% year-over-year and 6% sequentially.

• Core operating profit grew 38% year-over-year and 6% quarter-on-quarter, aided by improved operating efficiency and a reduction in cost-to-income ratio from 45% to 40%.

• Yield for the quarter stood at 17.81%, with spreads at 8.5% and cost of funds stable at 9.31%.

• Gross NPA stood at 2.70%, up 32 bps year-over-year; credit cost at 0.97% for the quarter.

• Capital adequacy ratio at 38.4%; tangible net worth at ₹2,820 crore.

Outlook and guidance

• Maintains guidance of 5%-7% quarter-on-quarter AUM growth, annual operating cost reduction of 50 basis points, and credit cost at the higher end of 80-100 basis points.

• Expects to reach 15% ROE by the last quarter of next financial year or Q1 of the following year.

• MSME financing market (₹5–30 lakh segment) estimated at ₹3.21 lakh crore, growing at 24% CAGR.

• Continued focus on granular, secured lending and technology-driven credit underwriting.

• No plans to change underwriting filters in the near term; will reassess after another quarter.