Highlights:

The company has witnessed a good quarter with strong sanctions and disbursements in Q1FY2023. The loan growth has accelerated sharply to 24% end June 2022.

The growth in the net interest income has been robust at 38% in Q1FY2023.

The company has maintained stable asset quality in Q1FY2023.

NIM has declined qoq to 3.6% in Q1FY2023 from 4.15% in Q4FY2022, while improved from 3.3% in Q1FY2022. The NIM was higher in Q4FY2022 due to higher investment income, excluding which the NIM was at 3.8%.

The spreads have improved to 2.66% in Q1FY2023 from 2.55% in the previous quarter and 2.4% in the corresponding quarter last year.

The company expects to maintain cost to income ratio at 18-19% for FY2023

The yield on loan book on outstanding basis stood at 8.46% and 8.21% incremental basis.

The cost of funds stood at 5.8% on outstanding basis and 5.67% on incremental basis.

With regard to inspection from Canara Bank that had observed irregularity in some accounts at one branch with exposure of Rs 3.93 crore, the exposure has reduced to Rs 2.34 crore and the company has fully provided for the same in the previous quarter.

After this incident, the company has done inspection of all 200 branches through internal teams and statutory auditors. There were some irregularity observations having amount involved at Rs 2.43 crore relating to 3 more branches in Tamil Nadu, Andhra Pradesh etc, while the company has also fully provided for this exposure.

The company expects to maintain stable asset quality ahead with +/-10 bps change.

The credit cost is expected at 0.2-0.24 bps for FY2023.

The company is targeting AUM growth of 18% for FY2023 taking into account all economic impact.

The company expects the threshold limit for t spreads at 2.4% and NIM at 3.0%.

The company is planning capital raising in FY2023.

The balance transfer out stood at Rs 100 crore for Q1FY2023.

The restructured loan book has declined by Rs 45 crore during Q1FY2023 from Rs 709 crore.

The company expects 5% of restructured to slip to NPA category against earlier estimate of 7% over next 5-7 quarters.

The company expects to raise its branch network to 210 branches by end March 2023.

The company expects to revert to its original salaried and non-salaried disbursements mix of 70-30 mix in next few quarters.

The stage 2 loan book of the company stands at Rs 471 crore.

The borrowings book of the company stood at Rs 25408 crore end June 2022.

The liquidity with the company stood at Rs 3000 crore.

The company is not holding any covid related provisions, which have been withdrawn long back.