{"id":160676,"date":"2024-04-30T07:53:25","date_gmt":"2024-04-30T11:53:25","guid":{"rendered":"https:\/\/44.250.171.167\/?p=160676"},"modified":"2024-04-30T07:53:26","modified_gmt":"2024-04-30T11:53:26","slug":"poonawalla-fincorp-ltd-q4-fy24-earnings-conference-call-insights","status":"publish","type":"post","link":"https:\/\/alphastreet.com\/india\/poonawalla-fincorp-ltd-q4-fy24-earnings-conference-call-insights\/","title":{"rendered":"Poonawalla Fincorp Ltd Q4 FY24 Earnings Conference Call Insights"},"content":{"rendered":"<p><strong>Key highlights from Poonawalla Fincorp Ltd (POONAWALLA) Q4 FY24 Earnings Concall<\/strong><\/p>\n<ul>\n<li><strong>Macroeconomic Update<\/strong>\n<ul>\n<li>Inflation projections manageable with normal monsoon season anticipated.<\/li>\n<li>Volatile crude oil prices pose external challenge for economy.<\/li>\n<li>RBI kept policy repo rate unchanged at 6.5%, expects GDP growth of 7% and inflation at 4.5% for FY2024-25.<\/li>\n<li>Outlook positive, with rural demand, moderating inflation, and growth in manufacturing and services supporting economic growth.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Performance Highlights<\/strong>\n<ul>\n<li>Achieved significant milestones of AUM crossing INR 25,000 crores and profit after tax crossing INR 1,000 crores.<\/li>\n<li>Recorded higher quarterly disbursements and best-in-class asset quality numbers.<\/li>\n<li>Differentiated strategy and relentless execution reflected across all business metrics.<\/li>\n<li>Quarter 4 was the best ever quarter for the company.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Growth and Outlook<\/strong>\n<ul>\n<li>Fundamentals of Indian economy strongly deep-rooted, presenting opportunities for steady credit growth in MSME and consumer segments.<\/li>\n<li>Company well-positioned to leverage opportunities and enable customers&#8217; dreams.<\/li>\n<li>Slight adjustment in interest rates expected over next couple of quarters to support growth while keeping inflation in check.<\/li>\n<li>Headwinds from geopolitical tensions and trade disruptions pose risks to outlook.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Financial Highlights<\/strong>\n<ul>\n<li>Highest ever quarterly disbursement of INR 9,688 crores, up 52% YoY, 11% QoQ.<\/li>\n<li>AUM at INR 25,003 crores, up 55% YoY, 14% QoQ.<\/li>\n<li>Gross NPA at 1.16%, down 28 bps YoY, 17 bps QoQ; Net NPA at 0.59%, down 19 bps YoY, 11 bps QoQ.<\/li>\n<li>Net Interest Margin healthy at 11.06%, up 4 bps QoQ.<\/li>\n<li>Operating Profit INR 409 crores, up 93% YoY, 17% QoQ; PAT INR 332 crores, up 84% YoY, 25% QoQ.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Industry Leadership and Innovation<\/strong>\n<ul>\n<li>First tech-led NBFC with inverse relationship between headcount and growth.<\/li>\n<li>Pioneered branch-light model, focusing on depth rather than wide expansion.<\/li>\n<li>Built strong risk and governance culture, setting benchmarks in wellness programs.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Risk Management<\/strong>\n<ul>\n<li>Robust risk management practices in place.<\/li>\n<li>Early warning signals, scorecards, business rule engines used for risk management.<\/li>\n<li>Fraud risk management framework, operational and InfoSec risk management practices followed.<\/li>\n<li>Corporate governance and compliance maintained at highest standards.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Technology and Digitization<\/strong>\n<ul>\n<li>Advanced technology stack and end-to-end digitized customer journeys.<\/li>\n<li>Automation and digitization of processes using available technology solutions.<\/li>\n<li>Systems hosted on cloud for enhanced availability and scalability.<\/li>\n<li>Digitization and automation in sales to increase workforce efficiency.<\/li>\n<li>Adoption of technology in collections for efficient cash management.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Customer Service<\/strong>\n<ul>\n<li>Multiple customer service touchpoints like WhatsApp, app, call centers, branches.<\/li>\n<li>Over 70% of customer requests handled through WhatsApp channel.<\/li>\n<li>Investments in latest collection solutions for changing payment systems.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Profitability<\/strong>\n<ul>\n<li>Crossed INR 1,000 crore PAT and INR 25,000 crore AUM milestones.<\/li>\n<li>Focus on operational efficiency, with industry-best opex to AUM ratio.<\/li>\n<li>Improvements in NIM through optimal product mix and low-cost borrowings.<\/li>\n<li>Recalibration of product mix for a balanced portfolio.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Asset Quality<\/strong>\n<ul>\n<li>Focused on credit-led model rather than collection-led model.<\/li>\n<li>Continuously strengthening credit policies based on learnings.<\/li>\n<li>Expect further improvement in GNPA and NNPA over next four quarters.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Net Interest Margins<\/strong>\n<ul>\n<li>Delivered superior NIMs above 11% guidance, aided by low opex model.<\/li>\n<li>Among lowest cost of funds in industry after CRISIL AAA rating.<\/li>\n<li>Started borrowing via CPs; scope for further reduction in cost of funds from Q3 onwards.<\/li>\n<li>Guided to maintain NIMs around 10%, with continued focus on risk-adjusted returns.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Regulatory Environment<\/strong>\n<ul>\n<li>Well-placed to capitalize on regulatory changes with strong capital base, credit rating, risk practices.<\/li>\n<li>Interest rate dynamics favorable with fixed-rate advances and variable borrowings.<\/li>\n<li>Focus on compliance, governance, and risk culture to navigate regulatory landscape.<\/li>\n<li>Quarterly review of policies to ensure adherence to regulations.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Cost Optimization<\/strong>\n<ul>\n<li>Consistent reduction in opex ratio from 5.5% to around 4% levels over last few quarters.<\/li>\n<li>Opex ratio of 3.35% after excluding ESOP charge, among the best in industry.<\/li>\n<li>Continued focus on productivity and efficiency to drive further opex ratio improvement.<\/li>\n<\/ul>\n<\/li>\n<li><strong>Co-branded Credit Card Launch<\/strong>\n<ul>\n<li>Received regulatory approval for co-branded credit card with IndusInd Bank.<\/li>\n<li>Launch planned for May 2024 after ensuring compliance with regulations.<\/li>\n<li>Unique product proposition with no joining\/annual fees to differentiate from market offerings.<\/li>\n<li>Poonawalla to receive one-time payout and revenue share while IndusInd handles risk and collections.<\/li>\n<\/ul>\n<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Key highlights from Poonawalla Fincorp Ltd (POONAWALLA) Q4 FY24 Earnings Concall Macroeconomic Update Inflation projections manageable with normal monsoon season anticipated. Volatile crude oil prices pose external challenge for economy. RBI kept policy repo rate unchanged at 6.5%, expects GDP growth of 7% and inflation at 4.5% for FY2024-25. Outlook positive, with rural demand, moderating [&hellip;]<\/p>\n","protected":false},"author":1767,"featured_media":154818,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":"","jetpack_publicize_message":"","jetpack_publicize_feature_enabled":true,"jetpack_social_post_already_shared":true,"jetpack_social_options":{"image_generator_settings":{"template":"highway","default_image_id":0,"font":"","enabled":false},"version":2}},"categories":[9825,392,1],"tags":[10169,9786,9708],"class_list":["post-160676","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-earnings-call-highlights","category-earnings","category-finance-stocks","tag-earnings","tag-msme","tag-nbfc"],"jetpack_publicize_connections":[],"jetpack_featured_media_url":"https:\/\/alphastreet.com\/india\/wp-content\/uploads\/2023\/10\/CC_Image_1.jpg","jetpack_likes_enabled":false,"jetpack-related-posts":[{"id":129556,"url":"https:\/\/alphastreet.com\/india\/poonawalla-fincorp-ltd-q4-fy22-earnings-conference-call-insights\/","url_meta":{"origin":160676,"position":0},"title":"Poonawalla Fincorp Ltd Q4 FY22 Earnings Conference Call Insights","author":"Praveen","date":"May 16, 2022","format":false,"excerpt":"https:\/\/youtu.be\/F77en0wURhY Key highlights from Poonawalla Fincorp Ltd (POONAWALLA) Q4 FY22 Earnings Concall Management Update: POONAWALLA said its Housing arm delivered its highest ever profit before tax of INR101 crores against INR14 crores last year. 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It offers general insurance services, consumer and MSME lending, and other financial services. Financial Results: Poonawalla Fincorp Ltd. reported Total Income for Q4FY23 of \u20b9 580.71 Crores up from \u20b9 399.22 Crore\u2026","rel":"","context":"In &quot;Earnings&quot;","block_context":{"text":"Earnings","link":"https:\/\/alphastreet.com\/india\/category\/earnings\/"},"img":{"alt_text":"SHARDAMOTR Q1 FY26 Earnings Results","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/04\/iStock-1443507250.jpg?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/04\/iStock-1443507250.jpg?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/04\/iStock-1443507250.jpg?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2023\/04\/iStock-1443507250.jpg?resize=700%2C400&ssl=1 2x"},"classes":[]},{"id":167341,"url":"https:\/\/alphastreet.com\/india\/poonawalla-fincorp-ltd-q3fy25-93-fall-in-profits\/","url_meta":{"origin":160676,"position":2},"title":"Poonawalla Fincorp Ltd Q3FY25; 93% fall in Profits","author":"Chirag Gupta","date":"March 11, 2025","format":false,"excerpt":"Poonawalla Fincorp Limited (erstwhile Magma Fincorp Limited) is a non-deposit taking NBFC registered with RBI. It is engaged in providing consumer and MSME financing, as well as General Insurance services. Financial Results: Poonawalla Fincorp Ltd reported Revenues for Q3FY25 of \u20b91,057.00 Crores up from \u20b9763.00 Crore year on year, a\u2026","rel":"","context":"In &quot;AlphaGraphs&quot;","block_context":{"text":"AlphaGraphs","link":"https:\/\/alphastreet.com\/india\/category\/infographics\/"},"img":{"alt_text":"","src":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/03\/4-6.png?resize=350%2C200&ssl=1","width":350,"height":200,"srcset":"https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/03\/4-6.png?resize=350%2C200&ssl=1 1x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/03\/4-6.png?resize=525%2C300&ssl=1 1.5x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/03\/4-6.png?resize=700%2C400&ssl=1 2x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/03\/4-6.png?resize=1050%2C600&ssl=1 3x, https:\/\/i0.wp.com\/alphastreet.com\/india\/wp-content\/uploads\/2025\/03\/4-6.png?resize=1400%2C800&ssl=1 4x"},"classes":[]},{"id":155142,"url":"https:\/\/alphastreet.com\/india\/poonawalla-fincorp-ltd-q2fy24-428-rise-in-profits\/","url_meta":{"origin":160676,"position":3},"title":"Poonawalla Fincorp Ltd Q2FY24; 428% rise in Profits","author":"Chirag Gupta","date":"October 20, 2023","format":false,"excerpt":"Poonawalla Fincorp Limited (erstwhile Magma Fincorp Limited) is a non-deposit taking NBFC registered with RBI. 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