Bengaluru, July 23, 2024: The Board of Directors of Mahindra & Mahindra Financial Services Limited (Mahindra Finance), a leading provider of financial services in Emerging India, at its meeting held today, announced the unaudited financial results for the quarter ended June 30, 2024 (Q1FY25).
Standalone:
Key Points: Q1 FY25 PAT grows 45% YoY to ₹ 513 crores v/s ₹ 353 crores – ROA of 1.8%
- AUM (Business assets): ₹ 1,06,339 crores v/s ₹ 86,732 crores, YoYá 23%
- Disbursement: ₹ 12,741 crores v/s ₹ 12,165 crores, YoYá 5%
- Total Income: ₹ 3,760 crores v/s ₹ 3,125 crores, YoYá 20%
- Continued leadership in Passenger vehicles, Pre-owned vehicles and Tractors.
- Stable Asset quality: GS2%+GS3% < 10%. Stage-3 @3.6%. Credit Cost:1.5% v/s 2.1% (Q1FY24)
- Capital Adequacy healthy at 18.5% – Tier-1 Capital @ 16.4%. Provision coverage on Stage 3 loans prudent at 59.8%. Total liquidity buffer comfortable at ~₹ 8,216 crores
FY 2024 Q1 Standalone Results:
| Q1FY25 Results (₹. Crores) | Q1 FY25 | Q1 FY24 | YoY % | Q4 FY24 | QoQ% |
| Total Income (TI) | 3,760 | 3,125 | 20% | 3,706 | 1% |
| Net Interest Income (NII) | 1,932 | 1,675 | 15% | 1,971 | -2% |
| NII Margin (as % of Avg. Total Assets) | 6.6% | 6.8% | 7.1% | ||
| Pre-Provisioning Operating Profit (PPOP) | 1,135 | 1,000 | 13% | 1173 | -3% |
| Credit Costs | 448 | 526 | -15% | 341 | 31% |
| Credit Costs (as % of Avg. Total Assets) | 1.5% | 2.1% | 1.2% | ||
| Profit After Tax | 513 | 353 | 45% | 619 | -17% |
| ROA (as % of Avg. Total Assets) | 1.8% | 1.4% | 2.2% | ||
| Disbursements | 12,741 | 12,165 | 5% | 15,292 | -17% |
| Gross Loan Book (Closing) | 1,06,339 | 86,732 | 23% | 1,02,597 | 4% |
Operations:
The quarter ended June 30, 2024 (Q1FY25) continued to witness steady growth in Business Assets now standing at ₹ 1,06,339 crores, reflecting a 23% YoY growth. Disbursements were at ₹ 12,741 crores, a moderate growth of 5% YoY.
The collection efficiency remained steady at 94%, similar to the same quarter of the previous year. With continued focus on underwriting standards and addressing early bucket delinquency, the asset quality remained stable. Stage-2 and Stage-3 together remained below 10%. The Stage 3 assets at 3.6% (versus 3.4% as of March 31, 2024) are within the defined risk guardrails for the company.
Mahindra Finance is among the top five NBFCs for financing three-wheelers, passenger vehicles (PVs), commercial vehicles (CVs), light commercial vehicles (LCVs) and small commercial vehicles (SCVs). It is the leading financer in the tractors segment. The company now also holds a strong position in the pre-owned vehicle business.
The company remains committed to expanding its footprint in new business categories. As part of this initiative, the new product portfolios – SME lending, loan against property (LAP), and leasing (Quiklyz), are demonstrating consistent growth potential. The company has also partnered with digital MSME lender Lendingkart under a co-lending arrangement to offer business loans to M/SMEs. The company recognizes the growth potential within the SME sector in India, and is thus strategically partnering with key industry stakeholders. Overall, the SME portfolio Disbursement grew YoY 68% in Q1FY25.
The plan is to grow the non-vehicle finance segment to 15% of the AUM over the medium term, while continuing to maintain its leadership position in the wheels business in Emerging India.
During the quarter, the company obtained a corporate agency license from the insurance regulator IRDAI, allowing to sell life and general insurance policies from various insurers. The objective is to offer comprehensive insurance solutions specifically addressing the evolving financial requirements of the customers. The company has so far onboarded six Insurance companies and more such collaborations are expected in future.
Digital transformation stands as a pivotal metric for Mahindra Finance to deliver seamless customer experiences, quicker turnaround times, and enhanced self-service journeys across products. With a strong focus on data, AI/ML, and analytics, the transformation aims to drive hyper-personalization, enhance asset quality, and improve underwriting processes. Employee experience is central to this journey, with transformation initiatives set to roll out in a phased manner in FY25.
Mahindra Finance is one of the few deposit taking NBFCs and is further strengthening its Fixed Deposit (FD) Portfolio. The company’s FDs are an attractive investment avenue, with a AAA Rating by CRISIL & India Ratings indicating highest safety standards. As of June 30, 2024, FDs as a percentage of total borrowings were at 8.9% compared to 6.9% as of June 30, 2023.
The balance sheet remains strong with a capital adequacy ratio of 18.5%. In addition, the company maintained a comfortable liquidity chest of ~₹ 8,216 crores. The provision coverage on Stage 3 assets remained prudent at 59.8%.
Mahindra Finance is steadfast in upholding its brand recognition and value. The company consistently reinforces its commitment to integrity, transparency, and ethical conduct through strengthened measures in compliance, risk management, and governance.
Consolidated:
FY 2024 Q1 Consolidated Results
| Q1FY25 Results (₹ Crores) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income (TI) | 4,355 | 3,637 | 20% |
| Profit After Tax | 497 | 362 | 37% |
| Disbursements | 13,380 | 12,500 | 7% |
Subsidiaries:
Key Points:
Mahindra Rural Housing Finance Limited (MRHFL)
| Q1FY25 Results (₹ Crores) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income | 303 | 342 | -12% |
| Profit Before Tax | -75 | -30 | |
| Profit After Tax | -57 | -23 | |
| Loans & Advances (net) | 6,912 | 6,626 | 4% |
| Gross Stage 3 % | 8.8% | 12.0% |
Mahindra Insurance Brokers Limited (MIBL)
| Q1FY25 Results (₹ Crores) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income | 287 | 164 | 75% |
| Profit Before Tax | 30 | 24 | 25% |
| Profit After Tax | 21 | 17 | 24% |
| Gross Premium | 1,127 | 940 | 20% |
Mahindra Manulife Investment Management Private Limited (MMIMPL)
| Q1FY25 Results (₹ Crores) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income | 19 | 14 | 38% |
| Profit After Tax | -5 | -6 | |
| Average Overall AUM | 22,565 | 10,262 | 120% |
| Average Equity AUM | 19,965 | 8,962 | 123% |
Mahindra Manulife Trustee Private Limited (MMTPL)
| Q1FY25 Results (₹ Crores) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income | 0.3 | 0.2 | 35% |
| Profit After Tax | 0.1 | 0.0 |
Mahindra Ideal Finance Ltd (MIFL)
| Q1FY25 Results (in LKR Mn) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income | 591 | 561 | 5% |
| Profit Before Tax (before VAT and Income Tax) | 40 | 79 | -50% |
| Profit After Tax | -1 | 25 | -104% |
| Loans & Advances (net) | 9,322 | 6,871 | 36% |
(LKR Exchange Rate 1 LKR = 0.2769 INR)
Joint Venture / Associate:
Mahindra Finance USA, LLC (MFUSA)
| Q1FY25 Results (in USD Mn) | Q1 FY25 | Q1 FY24 | YoY % |
| Total Income | 21 | 19 | 11% |
| Profit Before Tax | 7 | 6 | 25% |
| Profit After Tax | 5 | 4 | 26% |
(USD Exchange Rate 1 USD = INR 83.3988)
