Shriram Finance Limited (SFL), one of India's largest retail asset financing NBFCs, has announced its financial results for the second quarter ended September 30, showcasing robust growth across key metrics.

Financial Performance Highlights

SFL reported a notable 11.39% year-on-year increase in Profit After Tax (PAT), which stood at Rs. 2,307.18 crores for Q2, compared to Rs. 2,071.26 crores in the same quarter last year. The company's Net Interest Income (NII) also saw a healthy growth of 11.77%, reaching Rs. 6,266.84 crores, up from Rs. 5,606.74 crores in Q2 of the previous year.

Key Financial Metrics

All financial figures in Rs. crores, except EPS in Rs.

Assets Under Management

SFL's Assets Under Management (AUM) witnessed significant growth, increasing by 15.74% to Rs. 2,81,309.46 crores as of September 30, compared to Rs. 2,43,042.55 crores a year ago.

Interim Dividend Declaration

The Board of Directors has declared an interim dividend of 240%, amounting to Rs. 4.80 per equity share of face value Rs. 2 each. The record date for dividend entitlement is set as November 07.

Asset Quality

The company's asset quality showed improvement, with Gross Stage 3 assets decreasing marginally by 0.22% year-on-year. However, Net Stage 3 assets increased by 10.10%, indicating a potential area for monitoring.

Segment-wise Performance

Commercial Vehicles continued to be the largest segment in SFL's portfolio, contributing 45.55% to the total AUM, followed by Passenger Vehicles at 21.17% and MSME loans at 14.44%.

Conclusion

Shriram Finance Limited's Q2 results demonstrate the company's resilience and growth potential in the retail asset financing sector. The significant increase in AUM, coupled with improved profitability, positions SFL well for sustained growth. However, investors should keep an eye on the slight increase in Net Stage 3 assets, which may require careful management in the coming quarters.

As SFL continues to expand its presence across India with a network of 3,225 branches and a customer base of over 96 lakh, it remains a key player in the NBFC sector, particularly in financing commercial vehicles and MSMEs.

Shriram Finance Limited (SFL), one of India's largest retail asset financing Non-Banking Finance Companies (NBFCs), has announced a significant increase in its Assets Under Management (AUM) for the second quarter ended September 30, 2023.

Key Highlights

• Total AUM grew by 15.74% year-over-year to Rs. 2,813,094.60 million
• Net Interest Income increased by 11.77% to Rs. 62,668.40 million
• Profit After Tax rose by 11.39% to Rs. 23,071.80 million

AUM Growth

Shriram Finance reported a robust growth in its Assets Under Management, which stood at Rs. 2,813,094.60 million as of September 30, 2023. This represents a 15.74% increase compared to Rs. 2,430,425.50 million in the same period last year. The growth indicates a significant expansion in the company's lending portfolio and overall business scale.

Financial Performance

The company's financial results for Q2 FY24 show strong performance across key metrics:

Segment-wise AUM Break-up

Shriram Finance's diverse lending portfolio shows growth across various segments:

Asset Quality

The company maintained a stable asset quality profile:

• Gross Stage 3 assets stood at Rs. 127,362.60 million, a slight decrease of 0.22% year-over-year
• Net Stage 3 assets increased by 10.10% to Rs. 67,884.10 million
• Provision coverage ratio for Stage 3 assets was 46.70%

Management Commentary

Y. S. Chakravarti, Managing Director & CEO of Shriram Finance, stated, "Our strong AUM growth of 15.74% reflects the robust demand across our diverse product offerings. We continue to focus on expanding our reach and maintaining asset quality while driving sustainable growth."

Dividend Announcement

The Board of Directors has declared an interim dividend of 240%, amounting to Rs. 4.80 per equity share of face value Rs. 2 each for the financial year 2023-24.

Conclusion

Shriram Finance's impressive AUM growth and solid financial performance demonstrate the company's strong position in the retail asset financing sector. With a diverse product portfolio and expanding customer base, the company appears well-positioned for continued growth in the coming quarters.