Q2 2025 Mahindra and Mahindra Financial Services Ltd Earnings Call Transcript
Key Points
- Asset quality has improved with GS3 numbers declining to 3.8%, below threshold levels.
- Credit cost numbers are expected to decline, with FY25 exit projections in the range of 1.3% to 1.5%.
- Operational efficiency has improved, with OpEx numbers trending down.
- The company has seen strong disbursement growth in the past, which should support book growth aspirations.
- The company has made strategic hires to strengthen its leadership team, particularly in risk management and new business areas.
- There has been a recent uptick in GS3 numbers, particularly driven by the tractor segment, indicating some asset quality challenges.
- Disbursement growth has been muted in FY25, reflecting underlying market conditions and cautious lending.
- The diversification metric has trended below plan, with the company admitting it has not met its aggressive targets.
- The company faces challenges in maintaining margins due to elevated interest cycles and lower yields from prime customer segments.
- There is a noted increase in provision and credit cost due to higher GS3 numbers, particularly in the tractor and CV segments.
Good evening, ladies and gentlemen. Please note, this call is not for media representatives, investment bankers or commercial bankers, including corporate and commercial ForEx. All such individuals are instructed to disconnect now.
Ladies and gentlemen, good day, and welcome to the Mahindra Finance Q2 FY25 investors conference call hosted by Axis Capital Limited. (Operator Instructions) Please note that this conference is being recorded.
I now hand the conference over to Mr. Praveen Agarwal from Axis Capital. Thank you, and over to you, sir.
Thank you, Del. And good evening, everyone, and welcome to this earnings call of Mahindra Finance. From the management team, we have Mr. Raul Rebello, MD and CEO; Mr. Vivek Karve, Chief Financial Officer; Mr. Sandeep Mandrekar, our Chief Business Officer.
I would like to invite Mr. Rabello for his opening remarks, post which we'll open the floor for Q&A. Over to you, sir.
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