• Consolidated Net Income from Operations: INR218.5 crores, a 14% increase quarter-on-quarter.

• Net Interest Margin: 5.6%.

• Consolidated Profit: INR31.7 crores, up from INR24.9 crores in the previous quarter.

• Assets Under Management (AUM): INR10,112 crores, a 31% increase year-on-year.

• Disbursement: INR1,724 crores for the quarter, up from INR1,627 crores in the previous quarter.

• Standalone Net Total Income: INR165.9 crores, a 15% increase from the previous quarter.

• Operating Expenses: INR129 crores, up from INR112 crores in the previous quarter.

• Cash and Cash Equivalents: INR791 crores.

• Incremental Funding Raised: INR2,361 crores in the second quarter.

• Capital Adequacy: 25.9%.

• Debt to Equity Ratio: 2.26 times.

• Commercial Vehicle Disbursement: INR1,499 crores, a 53% growth year-on-year.

• Gross Non-Performing Assets (GNPA): 4.97% for the standalone entity.

• Housing Finance Disbursement: INR261 crores for Q2 FY25.

• Housing Finance AUM: INR2,561 crores, a 13% growth year-to-date.

• Housing Finance Gross Stage 3 Assets (GNPA): 1.41%.

• Housing Finance Profit After Tax: INR14 crores for the quarter.

• Housing Finance Capital Adequacy: 55.7%.

• Warning! GuruFocus has detected 7 Warning Signs with NSE:INDOSTAR.

Release Date: October 21, 2024

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Indostar Capital Finance Ltd (NSE:INDOSTAR) announced the sale of its wholly owned subsidiary, IndoStar Home Finance Private Limited, for INR1,750 crore, which is expected to strengthen its core business focus.

• The company received a rating upgrade from CRISIL to stable, reflecting improved financial stability and creditworthiness.

• Indostar successfully raised INR266 crores through its maiden public issue of secured, redeemable, nonconvertible debentures, enhancing its liquidity position.

• The commercial vehicle disbursement for Q2 FY25 reached INR1,499 crores, showing a growth of 53% over the previous year.

• The company has made significant investments in technology, enhancing its end-to-end loan origination system to be digitally driven, which is expected to improve operational efficiency.

Negative Points

• The annual retail inflation rose to 5.49% in September, driven by food inflation, which could impact consumer spending and borrowing costs.

• The RBI's unchanged repo rate and tightening regulatory norms for bank funding to the NBFC sector could limit Indostar's access to funds.

• The company's gross non-performing assets (GNPA) stood at 4.97% for FY25 Q2, indicating challenges in asset quality.

• Collection efficiency was impacted by adverse weather conditions, such as extended monsoons, affecting vehicle movement and revenue.

• The company's operating expenses increased by 16% over the previous quarter, driven by workforce expansion and branch costs, which could pressure profitability.