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Non-banking Financial company Piramal Enterprises announced Q3FY24 & 9MFY24 results:
- Total Assets Under Management (AUM) up 6% QoQ and 9% YoY, excluding the impact of AIF provisions.
- Provisions of Rs 3,540 crore taken under RBI circular on AIF investments, led to reduction in AUM.
- We remain confident of full recovery of the AIF investments.
- Growth to Legacy AUM mix improved to 72:28 from 34:66 in FY22.
- Growth AUM grew 63% YoY to Rs 48,590 crore.
- Legacy AUM down 47% YoY to Rs 18,693 crore, down 57% since FY22.
- Retail to Wholesale AUM mix improved to 64:36 from 33:67 in FY22.
- On AUM growth and AUM mix, the company is thus running ahead of the medium term guidance.
- Consolidated GNPA ratio down 33bps QoQ to 2.4% and NNPA ratio down 37bps QoQ to 1.1%.
- Profit After Tax (PAT) for Q3 FY24 stood at Rs 290 crore, excluding impact of AIF provisions.
- Reported loss of Rs 2,378 crore (vs PAT of Rs 48 crore in Q2 FY24) after the impact of AIF provisions.
- Net worth stood at Rs 26,376 crore with capital adequacy ratio at 24.3% on consolidated balance sheet.
- Announced sale of Rs 1,440 crore from Shriram investments (carrying value of Rs 569 crore). We expect closure in Q4 FY24; the proceeds from the transaction will further strengthen our balance sheet.
Ajay Piramal, Chairman, Piramal Enterprises, said, “We have achieved significant milestones outlined in our strategic roadmap earlier in this financial year. We have made progress across key areas, including AUM growth momentum, business mix optimization, enhanced underlying operating profitability, and improved asset quality. Notably, we are surpassing our medium-term guidance in terms of growth and business mix.
In response to the RBI circular issued in December, we made complete provisions for our investments in AIFs, subsequently removing them from our AUM. Our confidence in the full recovery of these investments remains strong, which is evident in the positive payment record thus far.
We have made substantial enhancements to our net interest margins, achieved robust fee income growth, and optimized opex ratios to deliver a strong core operating profit. Our commitment is to further enhance profitability by optimizing operating leverage in our growth business and reducing the contribution of the legacy business.
Positioned as an at-scale player in both retail and wholesale segments, PEL is poised for continued growth and improved profitability. The trajectory forward involves steadily scaling up our growth business, strategically winding down legacy wholesale assets, and divesting non-core assets. We believe, this approach will drive future growth and sustained profitability.”
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