India · Delayed Price · Currency is INR IIFL Finance Earnings Call Transcripts
Fiscal Year 2026
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Loan AUM grew 38% YoY to INR 1,08,180 crore, led by gold loans and secured lending. Asset quality improved, with gross NPA at 1.5% and net NPA at 0.7%. FY27 guidance includes 20%-25% AUM growth for gold loans and 18%-20% for housing finance.
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Q3 FY26 saw robust growth with AUM up 38% YoY, led by gold loans, and improved asset quality as GNPA dropped to 1.6%. Credit costs are expected to decline below 2% next year, and a 20%-25% AUM growth is targeted for FY27. S&P revised the outlook to positive.
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Q2 FY26 delivered strong profit and AUM growth, led by gold loans, while asset quality improved and discontinued products were front-ended for provisions. Guidance for loan losses and ROA remains steady, with home loans and gold loans as key growth drivers.
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Profit rebounded sequentially with strong gold loan growth, but asset quality stress in microfinance and MSME led to elevated credit costs in Q1. Guidance for AUM growth and ROA is maintained, with expectations of improved margins and asset quality in the second half.
Fiscal Year 2025
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Q4 FY25 saw a strong rebound with 10% sequential AUM growth and 208% profit surge, led by gold loans and improved asset quality. FY26 guidance includes higher secured MSME growth, margin improvement, and a return to 40% co-lending/DA share.
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Earnings declined sharply year-on-year due to asset quality stress in microfinance and unsecured segments, but quarter-on-quarter profit rebounded. Gold loan AUM is recovering, with yields expected to normalize next year, and liquidity remains adequate after a recent bond issue.
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Q2 FY25 saw a net loss due to a one-time AIF provision, but core AUM grew 7% YoY and gold loan business is rebounding post-embargo. Credit costs remain elevated in microfinance, while home loans and LAP are expected to grow 17%-20% for the year.
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RBI's embargo on gold loans led to a 50%+ drop in gold loan AUM and impacted overall profitability, but asset quality remained robust and other segments showed resilience. Liquidity and capital positions are strong, with compliance and risk management significantly enhanced.
Fiscal Year 2024
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Q4 FY24 profit declined 6% YoY due to the RBI embargo on gold loans, but full-year profit rose 23%. Gold loan AUM fell sharply, while home finance and business loans remained stable. Compliance and risk management are prioritized, with no FY25 growth guidance.