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Aditya Birla Capital Limited — Q4 FY24
Aditya Birla Capital delivered a strong Q4 FY24 with consolidated PAT up 41% YoY to INR 2,902 crore and revenue up 30% to INR 39,050 crore.
bullish
high
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Aditya Birla Capital delivered a strong Q4 FY24 with consolidated PAT up 41% YoY to INR 2,902 crore and revenue up 30% to INR 39,050 crore. Growth was driven by NBFC AUM crossing INR 100,000 crore (up 31% YoY), HFC AUM up 33%, and mutual fund AUM up 21%. Asset quality improved with NBFC stage 2+3 ratio declining 135 bps YoY to 4.49%. Management reiterated doubling the March 2023 loan portfolio by March 2026 and containing credit costs within 1.5%. The health insurance business targets 100% combined ratio by FY26. Key risk: potential NIM compression in HFC and elevated credit costs if economic conditions deteriorate.
आदित्य बिड़ला कैपिटल ने चौथी तिमाही में शानदार प्रदर्शन किया। कंपनी का मुनाफा पिछले साल से 41% बढ़कर 2,902 करोड़ रुपये हो गया। कमाई 30% बढ़कर 39,050 करोड़ रुपये रही। इसकी वजह है कर्ज देने वाली कंपनी (NBFC) का कुल कर्ज 1 लाख करोड़ रुपये पार करना, जो 31% ज्यादा है। घर का कर्ज (HFC) 33% और म्यूचुअल फंड का कर्ज 21% बढ़ा। कर्ज की गुणवत्ता बेहतर हुई है - खराब कर्ज का अनुपात 4.49% पर आ गया। कंपनी का लक्ष्य मार्च 2026 तक कर्ज पोर्टफोलियो दोगुना करना और कर्ज वसूली खर्च 1.5% से कम रखना है। हेल्थ इंश्योरेंस 2026 तक घाटा खत्म करेगा। जोखिम: अर्थव्यवस्था खराब होने पर कर्ज वसूली खर्च बढ़ सकता है।
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NIM compression in HFC
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NBFC AUM
INR 105,639 crore
+31% YoY
NBFC loan portfolio crossed INR 100,000 crore milestone, growing 31% YoY and 7% sequentially.
HFC AUM
INR 18,420 crore
+33% YoY
Housing finance portfolio grew 33% YoY, with disbursements up 64% YoY in Q4.
Mutual Fund Average AUM
INR 3.3 trillion
+21% YoY
Quarterly average AUM for mutual fund reached INR 3.3 trillion, with equity AUM at 46%.
NBFC Stage 2+3 Ratio
4.49%
-135 bps YoY
Gross stage 2 and stage 3 ratio declined 135 bps YoY and 36 bps sequentially, reflecting improved asset quality.
What Changed vs Last Quarter
NEW
Double March 2023 loan portfolio by March 2026
Management remains confident of doubling the March 2023 NBFC loan portfolio by March 2026, implying a CAGR of ~26%.
NEW
NBFC credit cost within 1.5%
Credit cost for NBFC businesses is guided to be contained within 1.5% going forward.
NEW
Health insurance combined ratio of 100% by FY26
Health insurance business targets a combined ratio of 100% by FY2026, improving from 110% in FY24.
NEW
Life insurance top-line CAGR >20% over 3 years
Life insurance business aims to grow top line at a CAGR of more than 20% over the next three years, with VNB margin in 18%-20% range.
DROPPED
Double NBFC portfolio in three years
Management expressed confidence in doubling the NBFC loan portfolio over the next three years, leveraging Udyog Plus, ABG ecosystem, and branch expansion.
DROPPED
D2C app launch in one month
The direct-to-consumer mobile app will go live in closed user group within one month, enabling new customer acquisition and holistic financial solutions.
DROPPED
NBFC credit loss to remain at ~1.5%
Management expects total credit loss in the NBFC portfolio to remain at similar levels (1.5% in Q3) going forward.
DROPPED
Health insurance profit in Q4, full-year loss lower than FY23
Health insurance expects a profit in Q4 and full-year FY24 loss to be lower than last year, with combined ratio improving.
NEW RISK
NIM compression in HFC
HFC ROE declined to 1.76% in Q4 from 1.92% in FY24, indicating NIM compression as the book grows with competitive pricing.
NEW RISK
Unsecured loan asset quality
Analyst raised concerns about rising GNPA in personal and consumer loans; management attributed it to denominator effect but acknowledged calibration in small-ticket unsecured loans.
NEW RISK
Life insurance VNB margin compression
VNB margin declined to 20.2% from 23% due to higher ULIP share and lower G-Sec rates; management expects margins to settle at 18%-20%.
NEW RISK
Regulatory changes in health insurance
Proposed IRDAI guidelines may lead to short-term adjustments; management remains positive on long-term growth but acknowledges potential near-term impact.
RISK GONE
Rising cost of funds
Cost of borrowing increased 7bps QoQ for NBFC and 5bps for HFC; further increases could pressure NIMs if competitive intensity limits pass-through.
RISK GONE
Regulatory tightening on unsecured lending
RBI's increased risk weights on personal and consumer loans could impact growth and capital adequacy; NBFC CAR improved to 16.67% but remains a watch item.
RISK GONE
Competition in secured lending
Banks are increasingly competing in secured loans (mortgages, LAP), which could pressure yields and market share.
RISK GONE
Health insurance loss trajectory
Health insurance net loss widened to ₹270 crore in 9M FY24 from ₹217 crore YoY; profitability improvement depends on Q4 performance and sustained loss ratio control.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q2 FY24
Management reiterated guidance to double NBFC loan book in three years and improve ROA to 3% through product mix shift and margin improvement.
Fast read
Guidance and risk preview
Management remains confident of doubling the March 2023 NBFC loan portfolio by March 2026, implying a CAGR of ~26%.
HFC ROE declined to 1.76% in Q4 from 1.92% in FY24, indicating NIM compression as the book grows with competitive pricing.
View Risks →