Mahindra Finance has said its profit grew 63 per cent to Rs 899 crore in the third quarter of Financial Year 2024-25 (Q3 FY25) compared to the year before. Credit cost dropping to Rs 9 crore from Rs 328 crore in Q3 FY24 helped boost profit.
Mahindra & Mahindra Financial Services, as the company is formally known, made a profit of Rs 553 crore in Q3 FY24. Net interest income – the difference between interest earned and interest paid – by 16 per cent to Rs 2,099 crore from Rs 1,779 crore in Q3 FY24. Total income grew by 19 per to Rs 4,144 crore.
“The company leveraged the buoyancy of the festive season demand in Q3 with disbursements of Rs 16,467 crore reflecting a Y-o-Y (year-on-year) growth of 7 per cent,” it said in a press statement. Gross loan book grew by 19 per cent Y-o-Y to Rs 1.15 trillion at the end of December 31, 2024. (Mahindra Finance is classified as an upper layer non-banking financial company.)
Net interest margin – a measure of profitability –slipped to 6.6 per cent from 6.8 per cent last year. Cost of funds inched up to 6.4 per cent from 6.3 per cent in Q3 FY24.
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The company’s non-vehicle finance portfolios, which include SME lending, leasing, insurance, payments and mortgages, grew 27 per cent due to product offering, improved technology, strategic partnerships, data analytics, and equipping its workforce to meet customer requirements.
Gross non-performing assets (GNPA) as on December 31, 2024 rose marginally to 3.93 per cent from 3.83 per cent as on September 30, 2024. Net NPA increased to 2 per cent from 1.59 per cent.
“With a continued focus on maintaining underwriting standards and addressing early-stage delinquencies, asset quality remained steady. Stage 3 assets stood at 3.9 per cent, versus 4.0 per cent as of December 31, 2023, while Stage 2 assets were at 6.3 per cent, compared to 6 per cent on the same date. The company continued to maintain a comfortable liquidity position on its balance sheet, with a liquidity chest of over Rs 9,322 crore,” said the statement.
The company’s credit decreased to 0 per cent from 1.2 per cent in Q3 FY24. Collection efficiency was 95 per cent, unchanged from Q3 FY24.