Sundaram Finance Ltd share Price

Sundaram Finance (SFL) is a Chennai-based financial group with a presence in auto finance, home finance, asset management and general insurance.

• Major value is derived from its vehicle financing business with AUM of ₹ 30,552 crore as of June 2022
• SFL has 632 branches with a substantial presence (~51%) in southern India

Sundaram Finance reported a mixed performance.

• Disbursements grew ~2.3x YoY and 31% QoQ at ₹ 4895 crore
• Core NII up 2.9% YoY but down 0.4% QoQ, NIMs down 21 bps QoQ at 5.3%, C/I higher at 35%
• Decline in provision led to 17.8% YoY PAT growth at ₹ 225 crore (-24.5% QoQ)
• Stage-3 assets increased 32 bps QoQ to 2.51%

Non-banking Financial company Sundaram Finance announced Q1FY24 results:

• Consolidated Q1FY24:
  • The assets under management (AUM) in the lending and general insurance businesses stood at Rs 57,150 crore as on June 30, 2023, against Rs 47,432 crore as on June 30, 2022.
    The assets under management of our asset management business stood at Rs 59,862 crore as on June 30, 2023, against Rs 48,810 crore as on June 30, 2022.
  • Profit after tax for Q1FY24 was Rs 375 crore as compared to Rs 246 crore in Q1FY23.
• Standalone Q1FY24:
  • Disbursements for Q1FY24 recorded a growth of 32% to Rs 6,489 crore as compared to Rs 4,915 crore registered in Q1FY23.
  • The assets under management stood at Rs 37,255 crore as on June 30, 2023, as against Rs 30,552 crore as on June 30, 2022, up by 22%.
  • The total restructured assets under Covid relief measures enabled by the Reserve Bank of India were at Rs 538 crore, about 1.5% of the loan outstanding, as on June 30, 2023.
  • Gross stage 3 as on June 30, 2023, stood at 1.90% with 48% provision cover as against 2.51% with provision cover of 49% as on June 30, 2022. Net stage 3 as on June 30, 2023, closed at 1.00% as against 1.30% as on June 30, 2022.
  • The Gross and Net NPA, as per RBI’s new asset classification norms for NBFCs, are 2.96% and 2.00% respectively as against 2.66% and 1.41% as of June 30, 2022 (based on old norms).
  • Cost to income ratio closed at 35.27% in Q1FY24 as against 36.02% in Q1FY23.
  • Profit after tax registered a 25% rise in Q1FY24, with net profit at Rs 281 crore. The company registered a net profit of Rs 226 crore in Q1FY23.
  • Return on assets (ROA) for Q1FY24 closed at 2.7% as against 2.5% for Q1FY23. Return on equity (ROE) was at 14.3% for Q1FY24 as against 12.9% for Q1FY23. Excluding investments in subsidiaries and group companies, core ROE was at 16.2% for Q1FY24 as against 15.5% for Q1FY23.
  • Capital Adequacy Ratio stood at 21.4% (Tier I –17%) as of June 30, 2023, compared to 24.1% (Tier I – 17.8%) as of June 30, 2022.

“The first quarter of FY24 has been satisfying. Assets under management grew by 22%, net stage 3 assets closed at 1.00% and profit after tax recorded a 25% growth to Rs 281 crore over the prior year period. Our Group companies in asset management, general insurance, and home finance have continued their trajectory from FY23 and recorded strong results. Overall, our time-tested approach of steady and sustainable growth with best-in-class asset quality and consistent profitability remains our primary focus," said Harsha Viji, Executive Vice Chairman.

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