Result Update Cholamandalam Investment Company Reports
Cholamandalam Investment : High Growth to Sustain
Reco : Buy Cmp : 221 Target : 260
Cholamandalam Investment & Finance Company (CIFC) reported strong operating performance with continued momentum in disbursements, stable NIM, and controlled increase in operating expenses in Q2FY13.
Key highlights: Disbursements grew 29% YoY and NIM improved 53 bps YoY. NPA provisions at Rs 233 mn increased 63% QoQ due to some stress seen in Orissa in vehicle finance portfolio and some provisions relating to business finance portfolio. PAT at Rs 697 mn (our est. Rs 752 mn) was up 75% YoY backed by 54% YoY NII growth and 95% YoY decline in provision expenses. Asset quality showed marginal stress with gross NPA ratio increasing 18 bps QoQ to 0.8%.
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