Sundaram Finance’s Net Profit Grows 9% YoY in Q1FY25

On August 13, 2024, Sundaram Finance Limited (SFL) announced its unaudited standalone and consolidated financial results for the quarter ended June 30, 2024, showcasing significant growth and continued operational excellence.

Standalone Performance Highlights

For Q1FY25, Sundaram Finance reported a 7% increase in disbursements, totalling ₹6,908 crore compared to ₹6,489 crore in Q1FY24. The company’s assets under management (AUM) saw a notable 23% rise, reaching ₹45,671 crore from ₹37,255 crore the previous year. Net interest income surged by 20%, reflecting strong financial health. Profit from operations also saw a robust 22% increase.

Net profit for Q1FY25 grew by 9%, reaching ₹308 crore, up from ₹281 crore in Q1FY24. Despite a decline in dividend income—down to ₹18 crore from ₹51 crore—the company maintained a solid return on assets (ROA) of 2.38%, although slightly lower than the 2.68% recorded in Q1FY24. The return on equity (ROE) stood at 13.6%, compared to 14.3% in the same period last year. Sundaram Finance’s capital adequacy ratio remains strong at 19.3%, supporting its planned growth.

Consolidated Performance Highlights

On a consolidated basis, which includes its subsidiaries Sundaram Home Finance, Sundaram Asset Management, and joint venture Royal Sundaram General Insurance, Sundaram Finance reported a 21% growth in AUM, totalling ₹69,234 crore, up from ₹57,150 crore. The AUM for its asset management business saw an impressive 35% increase, reaching ₹80,565 crore.

Profit after tax on a consolidated basis grew by 16%, amounting to ₹435 crore compared to ₹375 crore in Q1FY24. This performance underscores Sundaram Finance’s strong market position and its ability to deliver consistent growth across its diverse business segments.

Commenting on the performance, the Executive Vice Chairman of Sundaram Finance, Harsha Viji, said, “Team Sundaram has delivered a strong Q1FY25 despite lower-than-expected economic activity in the quarter. Assets under management grew by 23% to a new high of ₹45,671 crore, net stage 3 assets closed at 0.84%, and profit after tax recorded a 9% growth to ₹308 crore over the prior year period.”

He added that the group’s asset management, home finance, and general insurance companies have maintained a positive trajectory since FY24, recording strong results. They continue to rely on a time tested approach of steady and sustainable growth, with best-in-class asset quality and consistent profitability.

“As we expected, economic activity in Q1 was disrupted by the general elections as well as a particularly hot summer. We delivered a well-balanced GQP performance in a tough operating environment. Looking ahead, we expect seamless continuity in the policy agenda of the government at the centre and that economic activity will pick up through the rest of the year. Team Sundaram will continue to remain sharply focused on delivering the Sundaram experience to our customers, our people and all stakeholders,” said Rajiv Lochan, Managing Director.

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