IIFL Finance Q2 Results Review - One Off Provisioning Resulted In Loss; Worst Is Behind: Systematix

NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy..Systematix Report.IIFL Finance Ltd. reported a modest set of numbers. Though there was a beat in estimates on net interest income/Operating profit front, Profit after tax missed our estimates due to one-off provisions on Alternative Investment Fund investments. NII/OP came in higher at Rs 13.3 billion / Rs 8.6 billion (versus estimate of Rs 11.9 billion / Rs 6.9 billion) aided by lesser than expected contraction in assets under management and higher other income.Credit cost increased by 25 basis points QoQ to 2.4% mainly due to Micro Finance Institutions segment. Moreover, one-time provisions of Rs 5.9 billion on AIF investments resulted in a net loss of Rs 931 million (versus our PAT estimate of Rs 2.7 billion). Net interest margin on AUM (calc) increased by 10bps QoQ to 7.8%.AUM registered a de-growth of 4% QoQ, due to 27% QoQ contraction in gold AUM and 6% QoQ contraction in MFI AUM, which together constitute 33% of overall portfolio. Asset quality slipped marginally, with gross/ net stage 3 increasing by 15 bps/ 2 bps to 2.4%/ 1.1% and credit cost (On AAUM) at 2.4% (versus 2.2% in Q1).Management hopeful of bringing the gold loan book at pre ban level by March 2025, though remain cautious on MFI segment. For FY25, we expect consolidated AUM to de-grow by ~3% YoY followed by 12% growth in FY26. Maintain Buy rating on IIFL Finance with price target of Rs 560 (unchanged)..Click on the attachment to read the full report:.IndusInd Bank Q2 Results Review - Multiple Stress Led To Earnings Miss: DRChoksey.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

IIFL Finance Q2 Results Review - One Off Provisioning Resulted In Loss; Worst Is Behind: Systematix

The brokerage maintain 'Buy' rating on the stock with target price of Rs 560.

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