Shriram Finance Q3 net up 161% to Rs 1,777 cr on higher net interest income

Total AUM rose to Rs 1.77 trillion as on December 31, 2022 from Rs 1.24 trillion a year earlier

Shriram Finance Ltd’s net profit for the third quarter rose by 161 per cent year on year (YoY) basis to Rs 1,776.9 crore on higher growth in net interest income and improved asset quality.

The non-banking finance company’s net interest income for quarter ended December 2022 (Q3FY23) expanded by 85.42 per cent YoY to Rs 4,427.8 crore.  

Its stock closed 3.28 per cent higher at Rs 1,289 per share on BSE.

According to an investor presentation, its net interest margin (NIM) on the assets under management (AUM) stood at 8.52 per cent in Q3FY23 as against 6.65 per cent a year ago quarter (Q3FY22). The company added a caveat that the figures for Q3FY22 are restated to show the effect of merger of entities including Shriram City Union Finance, and are therefore not comparable.

Total AUM stood at Rs 1.77 trillion as on December 31, 2022 as compared to Rs 1.24 trillion as on December 31, 2021, SFl said in a press statement.

Y S Chakravarti, MD and CEO, Shriram Finance, said while high NII trajectory may not sustain, the business in the fourth quarter would grow and expect business to expand at 13-15 per cent in the next financial year (FY24).

Its asset quality improved with gross non-performing assets (NPAs) declining to 6.29 per cent in December 2022 from 8.4 per cent a year ago. Its net NPA also declined to 3.2 per cent from 4.36 per cent at the end of December 2021.

Its capital adequacy stood at 22.99 per cent at end of December 2022 as against 23.31 per cent a year ago.