Highlights:

• The AUM of the company surged 29% to Rs 88333 crore end June 2019 over June 2018. The loan portfolio of the company increased 19% to Rs 75933 crore, while the loans sold outstanding increased 165% to Rs 12400 crore end June 2019 over June 2018.
• The securitized book of the company has vintage of 37 months and NPA level of 0.22%.
• The disbursements declined 22% to Rs 7634 crore in the quarter ended June 2019. The retail segment disbursement increased 7% contributing 92% of fresh disbursement, while corporate loan disbursements dipped 81% in Q1FY2020.
• The net interest margin was steady at 3.14% in the quarter ended June 2019, compared with 3.18% in the preceding quarter and improved from 2.74% in the corresponding quarter last year.
• The blended interest rate on home loans stands at 9.38%, construction finance at 11.73% and non-housing loan at 10.55%. The blended cost of borrowings is at 8.31%.
• The company has witnessed increase in cost of borrowings due to rating downgrade by ICRA and CARE due higher leverage and elongated liquidity tightening cycle in the real estate sector.
• The company has conducted incremental borrowings of Rs 11550 crore in Q1FY2020, mainly through bank term loans, deposits and securitization. Cash and liquid investments of the company stands at Rs 5000 crore end June 2019.
• On the Deposits side, the company continues to be the second largest deposit taking HFC in the country. The deposits with the company have increased 32% to Rs 15446 crore at end June 2019.
• Gross NPA ratio increased to 0.85% at end June 2019 from 0.48% a quarter ago and 0.43% a year ago. Meanwhile, Net NPA ratio also increased to 0.67% at end June 2019 from 0.38% a quarter ago.
• An increase in NPA was mainly driven by one of five corporate accounts identified as stressed account slipping to NPA category. The account has exposure of Rs 150 crore, while the collateral cover stands at 2.5X and expects to recover this account in next two quarters. The company has raised ECL provisions on these stressed accounts to 21% from 17% earlier.
• Excluding the slippages of account from identified stressed asset pool, the GNPA stands at 0.65%.
• The corporate segment share in AUM declined to 19%, of which 13% is construction finance, 3% is LRD and 4% is corporate term loans.
• The company is cautious on lending to corporate houses and focusing more on retail business, cost efficiencies, maintaining adequate liquidity, diversified borrowings and healthy asset quality across segments.
• To be adequately capitalized for the future, the company has approved the capital raise plan to raise upto Rs 2000 crore in FY2020
• The operating expense to average asset is likely to improve as the company is focusing on operating efficiency. The company does not have plans to add branches in current year.
• The company expects credit cost to remain in the range of 25-27 bps for FY2020.