Conference Call with Muthoot Microfin Management and Analysts on Q2FY25 Performance and Outlook. Listen to the full earnings transcript.
Finance (including NBFCs) company Muthoot Microfin announced Q2FY25 results Financial Highlights: Total income grew by 18.0% YoY, from Rs 565 crore to Rs 667 crore. AUM increased by 15.2% YoY, from Rs 10,867 crore in Q2FY24 to Rs 12,518 crore in Q2FY25. NIM rose by 57 bps, from 12.79% in Q2FY24 to 13.36% in Q2FY25. PPOP increased by 26.0% YoY, from Rs 187 crore in Q2FY24 to Rs 236 crore in Q2FY25. GNPA increased by 33 bps YoY, from 2.37% in Q2FY24 to 2.70% in Q2FY25. CoF decreased by 14 bps, from 11.20% in Q2FY24 to 11.06% in Q2FY25. Business Highlights: GLP grew by 15.2% YoY from Rs 10,867 crore to Rs 12,518 crore; company disbursed Rs 2,674 crore. Borrower base grew by 7.7% YoY from 32 lakh to 34 lakh across 1,593 branches. The branch count grew by 18.9% YoY as the company added 31 new branches in Q2. South now comprises 50% of portfolio as the company makes inroads to two new states - Telangana and Andhra Pradesh. Thomas Muthoot, Managing Director of Muthoot Microfin, said: "Amid recent industry challenges, Muthoot Microfin delivered a solid performance this quarter, achieving a 15.2% YoY increase in our Gross Loan Portfolio, now at Rs 12,518 crore. We also added 31 new branches during this period. Our disciplined lending practices, backed by robust underwriting standards and prudent NATCAT policies, have driven sustainable portfolio growth while preserving asset quality. This quarter, we maintained a GNPA of 2.70% and NNPA of 0.97%, underscoring the strength of our portfolio. As we look ahead, we are prepared to accelerate our growth trajectory in this evolving industry landscape. With the implementation of SRO guardrails, we are committed to upholding high standards that will further strengthen stakeholder confidence and enhance the industry’s reputation.” Sadaf Sayeed, CEO, Muthoot Microfin, said: “The company has cautiously inched up disbursements to Rs 2,674 crore in the September quarter, up from Rs 2,204 crore in the previous quarter and returning to similar levels as last year. We expect growth to reaccelerate in coming quarters with usual seasonal upswing coupled with our focus on harnessing existing customers and strengthening our core geographies. Our asset quality remains stronger-than-peers led by our core mature southern markets and our robust underwriting and collection practices. During Q2, we have gone a step further and adopted a stance of being far more conservative providing additional Macro enabled overlay of 31.2 crore given bulging industry concerns. This increase in provisioning has resulted in creating Rs 153 crore surplus to IRAC prudential norms. Our willingness to invest against profitability has negatively impacted our ROA during the quarter which has gone down to 2.00%. We continue to underpin our ambition of industry leading returns and recalibrate our FY25 ROA guidance to 3.0-3.5% acknowledging the uncertainty prevailing within the industry while maintaining a continuous focus on balancing growth, profitability, and liquidity.” Result PDF