IIFL Finance , a leading non-banking financial company (NBFC), reported mixed results for the first quarter, with strong growth in gold loans offsetting challenges in other segments.

Financial Performance

The company reported a profit after tax of Rs 274.00 crores, up 9% quarter-on-quarter but down 19% year-on-year. Pre-provision operating profit increased 28% quarter-on-quarter to Rs 836.00 crores. Consolidated loan Assets Under Management (AUM) grew 21% year-on-year to Rs 83,889.00 crores.

Gold Loan Rebound

IIFL Finance's gold loan business showed a remarkable recovery, surging 85% year-on-year to Rs 27,274.00 crores, surpassing pre-embargo levels. The gold loan portfolio's Loan-to-Value (LTV) ratio stands at 66%, with yields improving to 18.2%.

Asset Quality Concerns

The company faced asset quality challenges, particularly in the MSME and microfinance segments. Gross Non-Performing Assets (NPAs) stood at 2.3%, while net NPAs were at 1.1%. The company has taken steps to address these issues, including discontinuing unsecured MSME and micro-LAP businesses.

Segment-wise Performance

Management Commentary

Nirmal Jain, Managing Director of IIFL Finance, stated, "This quarter has been a quarter of revival and reassurance. Our gold loan business has fully bounced back from last year's embargo, reaching an all-time high in AUM. We remain focused on building a high-quality, compliant retail loan franchise."

Future Outlook

IIFL Finance maintains its target of overall AUM growth of around 20% for the full year while aiming for a Return on Assets (ROA) of 3%. The company expects credit costs for the year to be around 3%, higher than the earlier guidance of 2.5%-2.7%.

Governance and Risk Management

IIFL Finance has strengthened its board with the appointment of B.P. Kanungo, former RBI Deputy Governor, as a board member. The company is also focusing on enhancing its risk management practices and technology-led execution.

In conclusion, while IIFL Finance faces challenges in certain segments, the strong performance of its gold loan business and strategic focus on retail lending provide a positive outlook for the company's future growth.

IIFL Finance Limited , a leading retail-focused non-banking financial company (NBFC), has announced its financial results for the first quarter, demonstrating robust growth and recovery across key business segments.

Financial Highlights

• Consolidated profit after tax (PAT) reached ₹274.00 crore, up 9% quarter-on-quarter (QoQ)
• Assets under management (AUM) grew to ₹83,889.00 crore, a 7% increase QoQ
• Gold loan AUM surged to ₹27,274.00 crore, marking a significant 30% growth QoQ and 85% year-on-year (YoY)

Segment Performance

• Home Loans: AUM grew 14% YoY and 1% QoQ to ₹32,017.00 crore
• MSME Loans: AUM rose 13% YoY to ₹13,939.00 crore, though down 2% QoQ
• Microfinance: AUM stood at ₹8,916.00 crore, down 26% YoY and 10% QoQ

Key Financial Metrics

Management Commentary

Nirmal Jain, Managing Director of IIFL Finance, stated, "Q1 has been a quarter of revival and reassurance. Our Gold Loan business has not just recovered post-embargo—it has surged to a new peak in loan AUM, reaffirming customer trust and branch-level resilience."

Kapish Jain, Group Chief Financial Officer, added, "The year has started on a strong footing both on the top line and bottom line with the flagship business of Gold showing smart AUM growth of 30% q-o-q and 85% y-o-y supported by healthy LTV, improving yield and best in class asset quality."

Strategic Initiatives

• Received RBI approval to open 10 branches in Jammu & Kashmir and 500 in locations across India
• Commenced AI initiatives with a dedicated team to implement transformation across business and customer-facing processes
• Strengthened governance with the appointment of former RBI Deputy Governor B.P. Kanungo to the Board of IIFL Finance

Asset Quality

• Gross Non-Performing Assets (GNPA) ratio stood at 2.34%, up from 2.23% in the previous quarter
• Net Non-Performing Assets (NNPA) ratio was 1.13%, compared to 1.05% in the previous quarter

IIFL Finance continues to focus on its digital transformation strategy, blending its extensive physical branch network with robust digital platforms to ensure seamless customer experiences and cost-effective scaling.

The company remains cautious on the MSME and microfinance segments due to current headwinds, emphasizing strengthening credit, recovery, and collection processes in these areas.

With a network of 4,872 branches and a customer base exceeding 4.6 million, IIFL Finance is well-positioned to continue its mission of enabling credit access for India's underbanked population.