Shriram City Union Finance posts 61 per cent rise in Q1 net profit

Shriram City Union Finance, India’s largest two-wheeler financer and part of the Shriram Group, has posted a 61 per cent rise in consolidated net profit during the first quarter of 2022-23 to Rs 354 crore as compared to Rs 220 crore during the April to June quarter of 2021-22.

The company’s income from operations during the quarter under review was seen up by 24 per cent to Rs 2,003 crore as against Rs 1,611 crore during April to June period of the previous financial year. The company’s disbursements rose by 82 per cent to Rs 8,726 crore, backed by a revival for micro, small and medium enterprises (MSME), gold and two-wheeler loans.

During the first quarter of the current financial year, assets Under Management (AUM) increased by 21 per cent to Rs 40,414 crore as against Rs 33,509 crore during the same time last financial year. The consolidated results include Shriram City and Shriram Housing Finance.

 “Across the financial parameters, we have excelled – record disbursements, improved asset quality, higher margins, credit cost moderated and ample liquidity buffers. The revival in the MSME ecosystem has resulted in stronger demand for credit than the pre-pandemic levels. Our subsidiary, Shriram Housing Finance’s AUM crossed Rs 5,800 crore and is one of the top affordable housing financers in India,” said Y S Chakravarti, managing director and chief executive officer, Shriram City.

 “Shriram Housing Finance has grown faster than the industry, coupled with maintaining impeccable asset quality and its growth prospects ride on expanding its distribution across the merged entities. The merger is progressing well and we are set to hit the ground running as Shriram Finance before the close of this year,” he added.      

On a standalone basis, Shriram City reported its best quarterly disbursements of Rs 7,931 crore, up 73.9 per cent, while AUM rose by 16.9 per cent year-on-year to Rs 34,611 crore. The company’s net profit rose to a record Rs 323 crore in Q1FY23. Asset quality improved with Gross NPAs declining 20 bps QoQ to 6.11 per cent in Q1FY23 (6.31 per cent in Q4FY22).