Mahindra & Mahindra Financial Services (M&M Finance) witnessed a decline of nearly 8% in its shares after revising its FY25 return on assets (RoA) target to 1.8-2% from the earlier 2.5%. Despite reporting a strong 57% year-on-year growth in net profit to ₹369.5 crore for Q2 FY25, this result fell short of the CNBC-TV18 poll estimate of ₹452 crore.
Key Financial Highlights:
- Net Profit: ₹369.5 crore in Q2 FY25, up 57% YoY from ₹235.2 crore in the same quarter last year, but below expectations.
- Revenue: Total revenue stood at ₹3,897 crore for Q2 FY25.
- Net Interest Income (NII): Increased to ₹1,963.2 crore, exceeding the CNBC-TV18 poll forecast of ₹1,858.6 crore, marking a 19.3% YoY growth from ₹1,645.5 crore.
- Gross NPA: Rose to 3.83% in Q2 FY25 from 3.56% in the previous quarter.
- Net NPA: Increased to 1.59%, up from 1.46% quarter-on-quarter.
- Total Income: Grew by 21% YoY to ₹3,925 crore.
- Assets Under Management (AUM): Rose by 20% YoY to ₹1.12 lakh crore.
The rise in non-performing assets (NPA) and the cut in RoA targets reflect some ongoing challenges in M&M Finance’s performance, particularly in managing its asset quality and profitability expectations.
As of 9:17 am the shares were trading 6.64% lower at ₹262.95 on NSE
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