Shriram Finance (SHRIRAMFIN) Q1 24/25 earnings summary

Executive summary

• Net interest income for Q1 FY25 rose 20.63% YoY to ₹5,354.47 crore; PAT up 18.21% YoY to ₹1,980.59 crore; consolidated PAT increased 18.60% YoY to ₹2,030.64 crore; EPS (basic) up 17.82% YoY to ₹52.70.

• Assets under management (AUM) grew 20.82% YoY to ₹2,33,443.63 crore as of June 30, 2024.

• Board approved divestment of entire stake in Shriram Housing Finance; deal with Warburg Pincus expected to close by Q3 FY25.

• Asset quality improved, with gross Stage III at 5.39% and net Stage III at 2.71%, both better than the previous year.

• Shriram Housing Finance AUM grew 50.93% YoY, with NII up 40.62% and PAT up 5.87% YoY.

Financial highlights

• Disbursements in Q1 FY2025 were INR 37,709.79 crore, up from INR 30,454.81 crore in Q1 FY2024.

• Total income for Q1 FY25 was ₹9,609.71 crore, up from ₹8,008.01 crore in Q1 FY24.

• Net profit after tax (standalone) for Q1 FY25: ₹1,980.59 crore vs ₹1,675.44 crore in Q1 FY24; consolidated net profit after tax: ₹2,030.64 crore vs ₹1,712.19 crore in Q1 FY24.

• Book value per share as of June 30, 2024: ₹1,344.99, up 12.22% YoY.

• Cost-to-income ratio improved to 27.45% from 28.85% in Q1 FY2024.

Outlook and guidance

• AUM growth guidance for FY2025 remains at 15%, with management expecting to potentially exceed this due to strong momentum.

• Disinvestment of Shriram Housing Finance expected to increase CRAR by ~80 bps post completion.

• Focus remains on bottom-line growth and improving product mix, especially in new geographies and smaller ticket loans.

• No material deviation in use of proceeds from recent non-convertible securities issues; all funds utilized as intended.

• Board approved resource mobilisation plan for debt securities issuance from Aug 1 to Oct 31, 2024.