Conference Call with Muthoot Microfin Management and Analysts on Q1FY25 Performance and Outlook. Listen to the full earnings transcript.
Finance company Muthoot Microfin announced Q1FY25 results: Financial Highlights: Total income increased by 33.5% YoY from Rs 480 crore to Rs 641 crore Net interest income (NII) increased by 36.6% YoY from Rs 280 crore to Rs 383 crore Pre-provision operating profit (PPOP) increased by 50.4% YoY from Rs 148 crore to Rs 223 crore Profit After Tax (PAT) up by 18.3% YoY from Rs 96 crore to Rs 113 crore The GNPA of the Company is at 2.10% as against GNPA of 2.75% a year ago, NNPA (Net of Stage III provision)* stood at 0.71% as against 1.09% last year. The GNPA improved by 65 bps and NNPA* by 38 bps. Robust liquidity of Rs 1,070 crore of unencumbered cash and cash equivalents, 9% of the total assets alongside unutilized sanctions totalling Rs 3,159 crores. Healthy capital position with a CRAR of 30.29% 26.8% of our collections are via digital channels such as UPI/Customer App, while 100% disbursements are entirely executed digitally Business Highlights: GLP grew by 21.6% YoY from Rs10,038 crore to Rs 12,210 crore; company disbursed Rs 2,204 crore Borrower base grew by 13.1% YoY from 30 lakhs to 34 lakhs across 1,562 branches. The branch count grew by 27.0% YoY as the company added 54 new branches in Q1. South now comprises 51% of portfolio as the company makes inroads to two new states - Telangana and Andhra Pradesh During the quarter Muthoot Microfin Ltd received Corporate Agent licence from IRDAI; enabling customized insurance plans to customers while augmenting its sources of revenue and earnings Entered into Co-lending Agreement with State Bank of India to empower women entrepreneurs in rural and semi-urban regions Lowered interest rates by 35 bps in July; second rate reduction introduced this year bringing down effective lending rate from 23.65% to 23.30% Greenshoe portion of the ECB oversubscribed from USD 25 million to USD 38 million; closure at USD 113 Million Thomas Muthoot, Managing Director of Muthoot Microfin, said- “Q1FY25 was a challenging quarter. In spite of the long duration of general elections, we managed to maintain the growth momentum. Despite these temporary disruptions, we remained resilient and continue to focus on steady portfolio growth driven by customer acquisition and the expansion of our branch network. Our scale enables us to achieve greater operating efficiencies, and with stable NIMs and robust asset quality, we are in a position to implement and execute the growth plans with greater confidence.” Sadaf Sayeed, CEO, Muthoot Microfin, said- “Reflecting on our Q1FY25, we are proud with our consistent operating performance. In spite of the elections, heatwaves and seasonal factors at play during the quarter, AUM growth remained strong at 21.6% YoY driven by expansion in branches and acquisition of customeRs Our core states in South remain resilient showing no stress from elections, agitations or natural calamities. We recently entered Telangana and plan to venture in Andhra Pradesh in the coming quarteRs We see a lot of untapped potential and believe a large chunk of growth in future to be also driven by further penetration into these markets. Our NIMs remain steady and we have passed two consecutive rate cut benefits during 2024 to our customeRs Our cost of borrowings too has improved sequentially and incremental cost stands at healthy 10.3%. We continue to reaffirm our guidance to full year numbers led by our robust regional mix, strong asset quality, Tech innovations and efficient liability franchise." Result PDF