Q1 2027 Cholamandalam Investment and Finance Company Ltd Earnings Call Transcript
Key Points
- Cholamandalam Investment and Finance Co Ltd (BOM:511243) reported a 21% year-on-year increase in disbursements, driven by strong demand across key vehicle categories.
- The MSME portfolio showed resilience with a 6% year-on-year growth in disbursements and a 26% increase in AUM, supported by customer acquisition and market expansion.
- The consumer segment experienced a 52% year-on-year growth in disbursements, leading to a 24% increase in AUM, with significant traction in home loans and gold loans.
- Net Interest Margins (NIMs) improved by 42 basis points year-on-year, aided by lower funding costs, while credit costs declined by 24 basis points.
- The company maintained a strong liquidity position with liquid assets of INR2,984 crore and a capital adequacy ratio of 19.81%, providing a solid foundation for future growth.
- There was a seasonal increase in Gross Non-Performing Assets (GNPA) by 25 basis points, which is a typical trend from quarter four to quarter one.
- Used vehicle disbursements were down sequentially, attributed to seasonal factors and changes in disbursement recognition timing.
- Home loan yields decreased by 60 basis points quarter-on-quarter, although this was explained as a typical Q4 to Q1 phenomenon.
- Concerns were raised about potential risks in the second half of the year due to below-average monsoon predictions and geopolitical conflicts.
- The company faced challenges in aligning disbursement recognition with check clearance, impacting reported disbursement growth figures.
(audio in progress) business maintained its growth momentum with disbursements increasing 21% year-on-year during the quarter. Growth was aided by healthy demand trends across key vehicle categories and deep market penetration, resulting in auto OEM growing 19% to INR1,24,132 crore.
The MSME portfolio also demonstrated continued resilience with disbursements growing 6% year-on-year and AUM increasing 26% year. The segment benefited from sustained customer acquisition and continued expansion in underpenetrated markets. Within the segment, LAP AUM grew 23% year-on-year to INR54,130 crore. SME AUM and SBPL AUM recorded robust growth of 39% and 40%, reaching INR9,923 crore and INR3,730 crore.
Consumer segment delivered strong growth during the quarter with disbursements increasing 52% year-on-year, reflecting sustained traction across all product categories and continued customer acquisition momentum. As a result, AUM grew 24% year-on-year to INR41,671 crore. Within the segment, the home loans continue
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