Cholamandalam Financial Holdings (CHOLAHLDNG) Q2 24/25 earnings summary

Executive summary

• Consolidated revenue for Q2 FY25 rose to ₹8,180 crore, up 28% year-over-year, with profit after tax at ₹1,125 crore and EPS at ₹27.99, reflecting robust growth across key business segments.

• H1 FY25 revenue reached ₹15,857 crore, up 31% year-over-year, and profit after tax increased 36% to ₹2,285 crore, driven by strong disbursement and asset growth.

• Gross direct premium for Q2 FY25 reached INR 2,171 crores, up 9.2% year-over-year, outpacing industry growth of 1.7%.

• General insurance gross written premium grew 11.5% in H1 FY25 YoY, with PAT up 59% to ₹261 crore and solvency ratio at 2.06x.

• The Board and Audit Committee reviewed and approved the results on November 8, 2024, with a limited review by statutory auditors.

Financial highlights

• Vehicle Finance disbursements grew 5% in Q2 FY25 and 9% in H1 FY25 year-over-year, with AUM up 22% YoY; PBT for the segment rose 26% in Q2 and 25% in H1.

• Loan Against Property disbursements surged 35% in Q2 FY25 and 39% in H1 FY25 YoY, with AUM up 41% YoY and PBT up 26% in Q2 and 28% in H1.

• Home Loans disbursements increased 16% in Q2 FY25 and 19% in H1 FY25 YoY, with AUM up 47% YoY and PBT up 79% in Q2 and 83% in H1.

• Expenses of management for Q2 at 32.18%, up from 29.7% year-over-year; half-year at 32.73%.

• Claims ratio improved to 72.6% from 73.8% year-over-year.

Outlook and guidance

• Vehicle Finance faces headwinds in commercial vehicles due to sectoral de-growth, but expects growth in two-wheelers and used vehicles.

• Loan Against Property and Home Loans segments are expected to benefit from underpenetrated markets and government initiatives, with industry growth forecasts of 22-24% for FY25.

• Management expects combined ratio and ROE trends to remain stable or improve, barring one-off items.

• Technology investments and digital transformation expected to continue into H2 and H1 next year.

• Industry regulatory changes on long-term policy recognition may impact reported top line and expense ratios.