Lower Provisions helped Chola to post strong Q4 FY22 Results, PAT at 690 Crores | Cholamandalam Investment and Finance Company Q4 FY22 Result Analysis & Conference Call Highlights

Business Overview:

Total AUM is at 35,490 crores grew by 8% YoY due to a slightly higher runoff post the moratorium.

Delivered best ever disbursal collections and profitability in Q4 FY22.

Performance is improved by recovery in both Auto and Mortgage Industry.

Strong rebound in residential housing sales in the current quarter due to the demand from customers.

Three new businesses are launched this year which are consumer and small enterprise loans, secured business and personal loans, small and medium enterprise loans.

Strong liquidity of 5,341 crores including 1500 crores invested in G-Secs.

Total security position of 13,246 crores including undrawn sanctions.

Board of Directors recommended a dividend of 70 paise per share which is 35% equity shares of company.

An interim dividend of 1 rupee and 30 paise is also declared in FY22.

Adopted a price tag of provisioning norm according to RBI circular from Nov 1^st, 2021.

Recruited more employees for collections to make it intensive in last 6 months.

Total Restructured book is at 3800 crores by the end of march, 2022 with stage 2 at 3362 crores.

CSEL business is improving with 33% of partnership business and 66% of traditional business.

In CSE loan book focus is more on professional and business loans compared to personal loans.

OPEX increased due to increased disbursals and investments in new businesses.

Net NPA is targeted to be below 4% in FY23.

Profitability Numbers:

NIM is at 1,516 crores in Q4 FY22 grew by 13% YoY.

NIM is at 5,757 crores in FY22 grew by 16% YoY.

PAT is at 690 crores in Q4 FY22 grew by 184% YoY.

PAT is at 2,147 crores in FY22 grew by 42% YoY.

ROA is at 4.8% in Q4 FY22 and 3.9% in FY22.

ROE is at 24.6% in FY22 against 10.4% in FY21.

PBT ROTA is going to be maintained between 3.5-3.9%.

NIM can be off-set in future by the reduction in NCL.

PBT stood at Rs.67 Cr for Q4 of FY 22 (95% Growth) and Rs.215 Cr in FY 22 (91% Growth).

Strong collections resulted Stage 3 down to 4.37% in Mar’22 from 5.85% in Dec’ 21.

 

Disbursements:

Total Disbursements are at 12,718 crores in Q4 FY22 grew by 58% Q-o-Q and 36% YoY.

Total Disbursements are at 35,490 crores in FY22 grew by 36% YoY.

Vehicle Finance Disbursements are at 8,785 crores in Q4 FY22 as against 6,153 crores grew by 43% YoY.

Vehicle Finance Disbursements are at 25,439 crores in FY22 grew by 26% YoY.

LAP Disbursements are at 1,978 crores in Q4 FY22 as against 1191 crores grew by 66% YoY.

LAP Disbursements are at 5,862 crores in FY22 grew by 62% YoY.

Home Loans Disbursements are at 441 crores in Q4 FY22 as against 538 crores in Q4 FY21.

Home Loans Disbursements are at 1,571 crores in FY22 as against 1,542 crores in FY21.

Combined New business disbursal are at 1,515 crores in Q4 FY22 and 2,619 crores in FY22.

Asset Quality:

ECL provisions are stress tested this year due to the impact of covid.

ECL model provisions across stages has increased over December, 2021.

Total write off is at 380 crores in Q4 FY22.

Factored a write off of 190 crores for long overdue accounts.

Management overlay of 336 crores are utilised.

Management overlay provisions stands at 500 crores in march,2022.

Asset Quality represented by stage 3 stood at 4.37% at the end of march, 2022.

PCR is at 39.67%.

GNPA is at 6.82% and NNPA is at 4.75%.

CAR is at 19.6% with tier 1 at 16.5%.

Cost of funds to borrowings is at 6.6%

 
Subsidiaries:

CSEC:

Cholamandalam Securities had 41.3 crores revenue.

The Broking business grew 6% and wealth business grew by 9% and Insurance business down by 7% as on Mar 2022.

The income grew by 33% in FY22 at Rs.40.01 crores as against Rs.30.14 crores in FY21 and by 11% in Q4FY22 at Rs.9.93 crores as against Rs.8.98 crores in Q4FY21.

The PBT grew by 9% in FY22 at Rs.7.48 crores as against Rs.6.84 crores in FY21.

The Wealth AUM crossed ₹ 1,875 crores.

CHFL:

Cholamandalam Finance had 55 crores revenue.

CHFL recorded a gross income of Rs. 15.90 crores in Q4FY22 as compared to Rs. 10.82 crores in Q4FY21.

The income grew by 52% at Rs.56.37 crores in FY22 as against Rs.37.15 crores in FY21.

PBT of Rs.1.22 crores as compared to Rs. 0.78 crores in Q4FY21, PBT grew by 251% at Rs.9.19 crores in FY22 as against Rs.2.62 crores in FY21.

 

LEGAL DISCLAIMER:

Use of this information is at the user's own risk. The Company and its directors, associates

and employees will not be liable for any loss or liability incurred to the user due to

investments made or decisions taken based on the information provided herein. The

investment discussed or views expressed herein may not be suitable for all investors. The

users should rely on their own research and analysis and should consult their investment

advisors to determine the merit, risks and suitability of recommendation. Past performance

is not a guarantee for future performance or future results. Information herein is believed to

be reliable, although its accuracy and completeness cannot be guaranteed. The images used

may be copyright of the company or third party. As a condition to using the services, the

user agrees to the terms of use of the website and the services.

DISCLOSURES UNDER SEBI (RESEARCH ANALYST) REGULATIONS, 2014:

Yadnya Academy Pvt. Ltd. (InvestYadnya) is registered with SEBI under SEBI (Research

Analyst) Regulations, 2014 with registration no. INH000008349.

Disclosure with regard to ownership and material conflicts of interest:

1. Neither Research Analyst nor the entity nor his associates or relatives have any financial

interest in the subject Company;

2. Neither Research Analyst nor the entity nor its associates or relatives have actual /

beneficial ownership of one per cent or more securities of the subject Company, at the

end of the month immediately preceding the date of publication of the research report

or date of public appearance;

3. Neither Research Analyst nor the entity nor its associates or his relatives have any other

material conflict of interest at the time of publication of the research report or at the

time of public appearance.

Disclosure with regard to receipt of Compensation

1. The Research Entity and its associates have not received compensation from the subject

company in the past twelve months.

2. The subject company is not or was not a client during the twelve months preceding the

date of recommendation

Please find attached for detailed analysis.