Piramal Enterprises Limited (PEL) has reported a robust financial performance for the first quarter, with a significant increase in net profit and strong growth in its retail lending segment. The company's strategic focus on expanding its retail portfolio and optimizing its wholesale business has yielded positive results.

Key Financial Highlights

• Net Profit: PEL's consolidated net profit surged by 52% year-on-year to ₹276.00 crores, compared to ₹181.00 crores in the same quarter of the previous year.
• Assets Under Management (AUM): Consolidated AUM grew by 22% to approximately ₹85,700.00 crores.
• Retail AUM: Witnessed a strong growth of 37% year-on-year, now forming 80% of total AUM.
• Growth Business: Comprising retail and wholesale 2.0, now represents 93% of total AUM.
• Consolidated Profit Before Tax (PBT): Stood at ₹301.00 crores, with the Growth business contributing ₹295.00 crores.
• Net Interest Margin (NIM): Increased by 10 basis points quarter-on-quarter to 5.9%.

Retail Lending Performance

The company's retail lending segment continued to show strong momentum:

• Disbursements: Reached ₹8,718.00 crores, up 28% year-on-year.
• Mortgage Business: Grew by 38% year-on-year to ₹47,101.00 crores, accounting for 55% of total AUM and 68% of retail AUM.
• Customer Franchise: Expanded by 21% year-on-year to 4.8 million.

Wholesale Lending and Asset Quality

• Wholesale 2.0 AUM: Grew by 14% quarter-on-quarter to ₹10,425.00 crores.
• Disbursements: ₹2,302.00 crores during the quarter across real estate and Corporate Mid-Market Lending (CMML) segments.
• Asset Quality: The wholesale 2.0 portfolio maintained zero delinquencies since inception.

Merger Update and Capital Position

• The merger between Piramal Enterprises and Piramal Finance is expected to complete by September 2025.
• Capital adequacy ratio stood at 19.3% compared to 23.6% at the end of the previous year.
• The completion of the merger process is anticipated to reverse about 245 basis points of the reduction in capital adequacy.

Management Commentary

Ajay Piramal, Chairman of Piramal Enterprises, commented on the results: "With the first quarter of the current year, we've had a good start of the year with balanced performance on all key parameters. Our Growth business, comprising of retail and wholesale 2.0, now stands at 93% of our total AUM. With reduced drag of the Legacy business, our consolidated PBT is ₹301.00 crores, out of which Growth business PBT is ₹295.00 crores."

Future Outlook

The company maintains a positive outlook, with targets set for Total AUM, Growth AUM, Retail-Wholesale AUM mix, Legacy AUM reduction, and total consolidated PAT. Management expressed confidence in meeting all these targets based on the first quarter performance.

Piramal Enterprises continues to focus on expanding its retail lending business while maintaining a cautious approach in certain segments. The company's strategic initiatives, including the upcoming merger with Piramal Finance, are expected to further strengthen its position in the financial services sector.

As the company navigates through the evolving market conditions, it remains committed to maintaining a balanced growth strategy and improving operational efficiencies to deliver sustainable value to its stakeholders.

Piramal Enterprises Limited (PEL) has released an investor presentation highlighting its robust financial performance and ambitious growth strategies for its financial services business. The company's focus on retail lending and plans for corporate restructuring underscore its commitment to creating shareholder value and streamlining operations.

Financial Performance Highlights

PEL reported a consolidated Assets Under Management (AUM) of ₹80,689.00 crore as of March 2025, marking a 12% Compound Annual Growth Rate (CAGR) from FY23 to FY25. The company's growth business, comprising retail and wholesale 2.0 segments, achieved an AUM of ₹73,769.00 crore with a Return on Assets Under Management (RoAUM) of 1.40%.

Retail Lending Momentum

The retail lending segment has shown particularly strong momentum:

• 35% year-over-year AUM growth in retail lending
• Presence expanded to 517 branches across 26 states
• Average Ticket Size (ATS) for retail loans at ₹15.00 lakh based on disbursements

Corporate Restructuring

PEL outlined plans for a significant corporate restructuring move:

• Merger of PEL with Piramal Finance Limited (PFL)
• Expected completion by Q3 FY26
• Aims to simplify the group structure
• Will provide shareholders direct access to the lending business

Financial Projections

The company has set ambitious targets for the near future:

• Consolidated Profit After Tax (PAT) of ₹485.00 crore for FY25
• Projected growth business AUM of approximately ₹96,000.00 crore for FY26
• Retail share in total AUM expected to reach 80-85% in FY26

Strategic Focus Areas

PEL's presentation emphasized several key strategic areas:

1. Diversification: Building a granular and diversified lending portfolio
2. Distribution: Expanding multi-channel, high-touch, and high-tech distribution model
3. Risk Management: Implementing superior data-driven underwriting capabilities
4. Technology Integration: Leveraging an agile tech framework for improved customer experience

Asset Quality

The company reported improving asset quality metrics:

• Gross Non-Performing Assets (GNPA) at 2.80%
• Net Non-Performing Assets (NNPA) at 1.90%

Conclusion

Piramal Enterprises' latest investor presentation paints a picture of a company in transformation, with a clear focus on retail-led growth and operational efficiency. The planned merger with Piramal Finance Limited signifies a strategic move to streamline the corporate structure and enhance shareholder value. As PEL continues to expand its retail presence and leverage technology for growth, investors will be watching closely to see if the company can deliver on its ambitious financial projections for FY26.