IIFL Finance Q1 FY25 results: Consolidated net profit down 28% at Rs 338 cr

RBI's curbs on fresh gold loan biz hits performance

IIFL Finance Ltd’s consolidated net profit declined by 28 per cent year-on-year (YoY) to Rs 338 crore in the first quarter ended June 2024 (Q1 FY25). It had posted a consolidated net profit of Rs 473 crore in the quarter ended June 2023 (Q1 FY24).

Its total income on a net basis declined by two per cent YoY to Rs 1,393 crore in Q1 FY25, the finance company said in a press statement filed with the stock exchange (BSE).

Nirmal Jain, Managing Director, IIFL Finance, said the recent RBI embargo on gold loans impacted financial performance during the quarter. “However, we have diligently followed all RBI guidelines and are committed to full compliance,” he added.

On March 04, 2024, the Reserve Bank of India directed the finance company to stop sanctioning or disbursing new gold loans and the assignment, securitisation, or sale of existing gold loans. This followed supervisory concerns in disbursals and collections of loan amounts in cash exceeding statutory limits and non-compliance with the standard auction process.

IIFL Finance said the loan assets under management (AUM) grew by just two per cent YoY to Rs 69,610 crore at the end of June 2024. Out of this, the gold loan book declined by 33 per cent YoY to Rs 14,727 crore as of June 30, 2024. IIFL’s retail home loans grew by 23 per cent YoY to Rs 28,089 crore. The microfinance loan AUM stood at Rs 12,011 crore, showing 17 per cent YoY growth.

Its gross non-performing assets (NPAs) rose to 2.2 per cent in June 2024 from 1.8 per cent a year ago. The net NPAs were flat at 1.1 per cent, the same level as a year ago.

The capital adequacy ratio stood at 27.8 per cent as of June 30, 2024, against the minimum regulatory requirement of 15 per cent, supported by the capital raised during the quarter.