Aditya Birla Capital Limited — Q3 FY25
Aditya Birla Capital reported a mixed Q3 FY25 with consolidated PAT declining 3% YoY to INR 708 crore, while revenue grew 10% to INR 10,949 crore.
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Claim Ledger
Did management answer the analysts?
Every material analyst question, graded on whether management actually answered it — with the verbatim exchange and quantitative claims checked against filed numbers.
50%Questions answered1Evaded / deflected11Questions audited
Partial answer
High priority
Drivers of 62% YoY HFC growth and sustainable growth rate.
Asked by Chintan Shah, ICICI Securities
Management described drivers but did not quantify sustainable growth rate.
no specific sustainable growth rate givenqualitative drivers only
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Question
We have seen a robust growth of 62% probably YoY basis. So what are the potential drivers? And so where should we see the growth over the medium term?
Pankaj Gadgil, Managing Director and CEO of Aditya Birla Housing Finance
I think if you see the disbursements, so you know this is a culmination of several consistent quarters of growth... we've made investments in widening our distribution... digital platforms... FinVerse... we will be seeing similar trajectories of growth in the next few quarters.
Partial answer
Medium priority
PCR decline in NBFC and stable level going forward.
Asked by Chintan Shah, ICICI Securities
Explained reason for decline but did not give a stable PCR number.
no specific target PCR given
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Question
On the PCR in the NBFC segment on stage three it is around 46.5%... it is stable QoQ but seems to be declining. So how should we see this PCR going ahead?
Rakesh Singh, Executive Director and CEO of NBFC
That year on year the PCR has come down by 3-4%. That's primarily on the backdrop of change in the product mix... secured book has gone up from 67% to 74%... PCR is quite stable.
Partial answer
High priority
ROA levers for NBFC after margin compression.
Asked by Chintan Shah, ICICI Securities
Explained margin compression but did not quantify ROA improvement levers.
no specific ROA target or timeline
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Question
ROA is 2.1%... margins have compressed around 90 basis points yoy... what are the levers probably to expand?
Rakesh Singh, Executive Director and CEO of NBFC
Your question on margin... 28 basis points lower margin compared to the last quarter and 90-odd basis points compared to last year... on the backdrop of change in the product mix... personal and consumer business... should help improve and stabilize our margins.
Answered
High priority
Target product mix for secured vs unsecured.
Asked by Chintan Shah, ICICI Securities
Provided specific target range for personal and consumer mix.
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Question
Any ballpark number which we are looking beyond which we won't move the secured mix?
Rakesh Singh, Executive Director and CEO of NBFC
If you look at today our personal and consumer has come down from 19-odd% to 13%. We would like to grow it back to 18-20%. Not immediately but in the medium term.
Partial answer
High priority
Will NBFC margins decline further or stabilize?
Asked by Chintan Shah, ICICI Securities
Gave qualitative stability expectation but no quantified margin outlook.
no specific margin guidance
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Question
Any ballpark number on the Margin, so could it decline further from hereon, or should we expect some stability around current levels of 6% area?
Rakesh Singh, Executive Director and CEO of NBFC
I think we should see stability around these numbers before it improves.
Partial answer
Medium priority
Housing mix decline and regulatory threshold.
Asked by Anuj Singla, Bank of America
Gave range but numbers inconsistent; did not clearly state where mix will settle.
contradictory numbers (58% vs 53-54%)no clear settlement level
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Question
Housing is down by around 850 basis points to 57%. Can you give us some sense of where this can settle down? And you also have that criteria for the principal business.
Pankaj Gadgil, Managing Director and CEO of Aditya Birla Housing Finance
We had a 65%... it is now showing at around 58%... The minimum threshold is 50% overall housing... we are in that range bound, 53%-54%... well above the 60% mark.
Partial answer
Medium priority
Margin risk from rate cut on HFC.
Asked by Anuj Singla, Bank of America
Described asset-liability mix but did not quantify margin risk.
no quantitative margin impact estimate
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Question
Can you give us some sense on the margin risk from the rate cut if it comes through?
Pankaj Gadgil, Managing Director and CEO of Aditya Birla Housing Finance
95% is variable, 5% is fixed and on the side of liability side, 39% is fixed and 61% is variable... there is a wide spread in the term loans and the NCDs... we're fully placed.
Partial answer
High priority
Impact of surrender value regulation on life insurance margins.
Asked by Anuj Singla, Bank of America
Explained timing impact but did not quantify margin effect.
no quantification of margin impact
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Question
Can you give us an idea if there is some impact of that surrender value regulation in this quarter margins as well?
Pankaj Gadgil, Managing Director and CEO of Aditya Birla Housing Finance
When the new regulations all products had to be refiled... some loss of time would have got incorporated... Q4 will look better... margins have gone down on account of both... you will see the expansion of NIM story that I was saying will fully reflect in Q4.
Declined
Medium priority
Quantify independent impacts of surrender value and repricing.
Asked by Anuj Singla, Bank of America
Refused to quantify on the call, offered to follow up separately.
deferred to separate discussion
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Question
Is it possible to quantify the independent impacts like for the surrender value if it were not to be there, what could be?
Pankaj Gadgil, Managing Director and CEO of Aditya Birla Housing Finance
Possible, but like I said, it will have to get through every period of one month... I can reach out to you separately for details on that.
Partial answer
High priority
Reason for broad-based deceleration in NBFC disbursements.
Asked by Abhijit Tibrewal, Motilal Oswal
Cited seasonality and consumer segment decline but did not fully explain broad deceleration.
attributed to cycles, no detailed explanation for secured deceleration
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Question
There has been a deceleration in disbursements in this quarter... very broad-based deceleration... how should we read that?
Rakesh Singh, Executive Director and CEO of NBFC
There are different cycles... Q2 was stronger but if you compare year on year I think primarily the decrease is coming from the consumer segment which is 47% down year on year. Again Q4 will be better.
Answered
Low priority
Proportion of HFC disbursements from balance transfer.
Asked by Abhijit Tibrewal, Motilal Oswal
Provided specific percentage range for balance transfer proportion.
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Question
Out of our disbursements in the HFC in the Q3 in nine months, what proportion of disbursements came from BTs?
Pankaj Gadgil, Managing Director and CEO of Aditya Birla Housing Finance
That proportion is between 8%-10% of it in that we do.
Partial answer
High priority
Timeline for NBFC ROA improvement from 2.1% to 2.5%.
Asked by Avinash Singh, Emkay Global Financial Services
Mentioned levers but did not provide timeline for ROA improvement.
no timeline given
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Question
From this 2.1% if you are aiming for say 2.5-odd%, I mean how this road is going to be... how long will this take?
Vijay Deshwal, Chief Strategy Officer and Head of Investor Relations
Margin expansion should happen... product mix... should help us to go from 2.1% to 2.4-2.5%.