In This Article:
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Consolidated Revenue: Increased by 36% year on year to ?12,007 crore.
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Consolidated Profit After Tax (PAT): Grew by 42% year on year to ?1,001 crore, including a one-time gain of ?167 crore.
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NBFC Loan Portfolio: Grew by 23% year on year to ?1.15 trillion.
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NBFC Profit After Tax: Increased by 15% year on year to ?629 crore.
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Housing Finance Loan Portfolio: Grew by 51% year on year to ?23,236 crore.
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Mutual Fund Average AUM: Increased by 23% year on year to ?3.8 trillion.
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Life Insurance Individual First Year Premium: Grew by 33% year on year.
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Health Insurance Gross Written Premium: Increased by 39% year on year to ?2,171 crore.
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Branches: Total of 1,470 branches as of September end.
Release Date: October 30, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Aditya Birla Capital Ltd (NSE:ABCAPITAL) reported a consolidated profit after tax growth of 18% year on year, excluding one-off items, and 12% sequentially to INR 834 crore.
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The company's total consolidated revenue grew by 34% year on year to INR 11,804 crore.
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The NBFC portfolio grew by 23% year on year and 7% sequentially, with business loans to SMEs growing by 39% year on year.
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The mutual fund average AUM grew by 23% year on year and 9% sequentially to about INR 3.8 trillion.
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The health insurance business saw a 39% year on year growth in gross underwritten premium, maintaining its position as the fastest-growing standalone health insurer.
Negative Points
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The new surrender guidelines in the life insurance business are expected to impact VNB margins, necessitating realignment of commission structures.
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The unsecured personal and consumer loans segment faced tightened underwriting norms, impacting growth.
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The company's net interest margin in the NBFC business saw a decline due to a shift towards more secured lending.
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The asset quality improvement in the NBFC business may face challenges due to the current volatile market environment.
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The life insurance business reported a VNB margin of 7.4% in H1 FY25, which is below the projected guidance levels of 17% to 18%.
Q & A Highlights
Q: Your Provision Coverage Ratio (PCR) has declined while credit costs have also decreased. Can you explain the reason for this, especially in the secured segment? A: The decline in PCR is due to a shift in our loan book composition, with 74% now secured by real estate collateral or listed securities. This change in product mix affects the Expected Credit Loss (ECL) model, leading to a marginal drop in PCR. There is no decline in stage two provisioning.