Poonawalla Fincorp gets thumbs up as disbursements jump over 150 per cent in FY22!

Interestingly, the stock has gained after five days of consecutive falls.   

The stock of Poonawalla Fincorp Limited has been among the top-performing stocks on the exchanges as it soared nearly 12 per cent. Interestingly, the stock has gained after five days of consecutive falls.   

So, what happened overnight that the sentiment suddenly shifted in the stock?  

It is back into reckoning after reporting impressive earnings.   

Here are the key performance highlights: 

Assets under management (AUM) for FY22 increased to Rs 16,579 crore, recording a growth of 17 per cent over FY21 while disbursements stood at Rs 9,494 crore, growing by 158 per cent over FY21.  

Housing subsidiary, Poonawalla Housing Finance Limited (PHFL) crossed the Rs 5,000 crore AUM mark in March 2022.  

NIM increased by 65 bps YoY to 8.9 per cent.  

Consolidated PBT for FY22 stood at Rs 492 crore against a loss of Rs 749 crore in FY21. PAT for FY22 stood at Rs 375 crore.  

Collections continued to remain buoyant with collections efficiency of 108.4 per cent in March 2022.  

Asset quality (consolidated)  

Consequent to healthy collections in Q4FY22, gross stage 3 and net stage 3 assets decreased from 3.5 per cent & 1.8 per cent, respectively as of December 21 to 2.7 per cent and 1.1 per cent, respectively as of March 2022. The company has healthy provision coverage ratios across all three stages. Standard asset provision coverage ratio as of March 2022 stands at 2.7 per cent while stage three provision coverage ratio stands at 58.9 per cent.  

Liquidity and cost of borrowings (consolidated)  

The company continues to maintain a strong liquidity position with a surplus of Rs 3,890 crore. The repricing of all eligible term loans and new borrowing at competitive rates resulted in further bringing down the average cost of borrowing to 7.4 per cent in Q4FY22 with an overall reduction of 209 bps YoY. The company and its subsidiary PHFL continue to have a long-term rating of ‘AA+/Stable’ by CRISIL and CARE.  
 

Business update (consolidated)  

The company continued its product focus on consumer and small business segments. The business gained momentum in Q4 of FY22, resulting in the company entering the leadership board in the pre-owned cars and loan to professionals segment. Consumer lending was further strengthened, and the company entered the digital consumption space through partnership. The direct, digital & partnership (DDP) model of origination accelerated further, registering 43.7 per cent QoQ growth. The focus on capability building continued with deep investments in technology and people.  

Capital raise for PHFL  

The board has accorded an in-principal approval to raise funds in Poonawalla Housing Finance Limited with raise not exceeding Rs 1,000 crore with a stake dilution of less than 15 per cent in one or more tranches by way of a preferential issue during the financial year 2022-23.