Shriram Finance (SHRIRAMFIN) Q2 24/25 earnings summary

Executive summary

• Disbursement growth of 15.51% year-over-year, reaching INR 39,974.09 crore in Q2 FY25.

• Total income for Q2 FY25 rose 17.89% year-over-year to Rs. 100,966.8 mn; H1 FY25 up 18.83% to Rs. 196,937.5 mn.

• Profit after tax increased by 18.3% year-over-year to INR 2,153.27 crore in Q2 FY25.

• Board approved a 1:5 stock split (face value now INR 2 from INR 10) and declared a 220% interim dividend (INR 22 per share) for H1 FY25.

• SFL to sell stake in Shriram Housing Finance to Warburg Pincus for Rs. 46,300 mn, with SFL to receive Rs. 39,000 mn, boosting CRAR by ~80 bps.

Financial highlights

• Net interest income rose 16.37% year-over-year to INR 5,606.74 crore in Q2 FY25.

• AUM reached Rs. 2,43,042.55 crore in Q2 FY25, up 19.94% year-over-year.

• EPS for Q2 FY25 at Rs. 56.93, up from Rs. 47.61 in Q2 FY24.

• Cost-to-income ratio at 27.95% for Q2 FY25; NIM at 8.74%.

• Net worth as of September 30, 2024, stood at Rs. 52,287.13 crore, up from Rs. 46,202.05 crore a year ago.

Outlook and guidance

• Expectation of improved credit demand and economic activity in the next two quarters, supported by strong rural output and government infrastructure spending.

• Targeting further improvement in asset quality, aiming for Stage 3 assets around 5%.

• CV portfolio expected to grow 17%-18% over the next two quarters.

• Sale of Shriram Housing Finance Limited is highly probable, with regulatory approvals in place and assets/liabilities classified as held for sale.

• Forward-looking statements caution actual results may differ due to risks and uncertainties, including strategy execution and policy changes.