Company Update : Buy Mahindra Finance By Motilal Oswal Financial Services
Business assets up ~22% YoY; Stage 2/Stage 3 rose by ~100bp/30bp QoQ CE stood at 95% (PY: 96% ) Key takeaways from Jun’24
business update:
* Jun’24 disbursements grew ~3% YoY to ~INR43.7b. 1QFY25 disbursements grew 5% YoY to INR127b.
* Gross business assets as of Jun’24 stood at ~INR1.06t, up 22% YoY/4% QoQ.
* Jun’24 collection efficiency (CE) stood at 95% (vs. 96% in Jun’23). 1QFY25 CE stood at 94% (vs. 94% in Jun’23).
* MMFS reported that its Stage 3 is estimated at 3.6% in 1QFY25 (vs. 3.4% in 4QFY24) and Stage 2 at 6.1% (vs. 5.0% in 4QFY24). Asset quality deterioration could be attributed to seasonality, elections and heat waves.
* As of Jun’24, MMFS maintained a comfortable liquidity position at ~INR80b
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