Arman Financial Services Limited reported its financial results for the quarter ended June 30, 2024 (Q1 FY 2025).
The company reported that the consolidated Asset Under Management (AUM) reached approximately ₹2,594 crore, marking a 21% year-on-year growth. Due to macroeconomic challenges, disbursement activity slowed, with disbursements for Q1 FY25 totalling around ₹459 crore.
Net total income for Q1 FY25 amounted to approximately ₹119 crore, reflecting a 39% year-on-year increase. The Profit After Tax for Q1 FY25 stood at ₹31 crore, declining from ₹40 crore in Q1 FY 2024.
Total borrowings were approximately ₹2,217 crore, including off-balance sheet direct assignment (DA) liability. Additionally, the company has around ₹225 crore in undrawn sanctions from existing lenders.
Speaking on the performance for the quarter, the Vice Chairman and Managing Director of Arman Financial Services, Mr Jayendra Patel, said, “In Q1 FY25, Arman navigated a challenging environment marked by economic uncertainties, disruptions related to central elections, and reports of excessive heat waves in key geographies. Over and above these issues, there are signs of overleveraging with MFI clients which has resulted in lower repayment rates. This issue is being addressed both by industry and Arman. Owing to these headwinds, we maintained a cautious approach to growth, ensuring the stability of our operations.”
He further stated, “Profit After Tax (PAT) for the quarter was ₹31 crore as compared to ₹40 crore in the same period last year. Lower PAT was on account of higher provisioning and our focus on managing risk. Looking ahead in the short term, we will remain vigilant and selective in our growth strategy. Our priorities include continuing to strengthen our risk management practices to protect portfolio quality, adopting a measured approach to expansion by focusing on markets where we have a strong understanding of local dynamics, and enhancing our capabilities to ensure operational efficiency.”
“To summarise, our industry has matured and has ebbs and flows like any other industry. However, we are confident that the company, our customers, and the industry are resilient. While the rural environment remains uncertain, we are well-capitalized for future growth and are confident that our prudent approach will enable us to navigate challenges effectively and yield better performance in the coming quarters. We are confident that the many large and small initiatives we are taking will be adequate and, before long, we will be well on our way to continuing our growth story,” stated the Vice Chairman and Managing Director.
Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.
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