Cholamandalam Investment Q4 Review - Beefing-Up Buffer To Cushion Earnings: ICICI Securities
A man counts Indian rupee banknotes in India. (Photographer: Dhiraj Singh/Bloomberg)

Cholamandalam Investment Q4 Review - Beefing-Up Buffer To Cushion Earnings: ICICI Securities

BQ Blue’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BloombergQuint’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.

ICICI Securities Report

  1. Cholamandalam Investment and Finance Company Ltd.’s Q4 FY21 earnings surprised on few counts:
  2. Despite retracement in collection efficiency, stage-II/III went up QoQ (crossing 10% mark); however restructuring of ~2% was categorised as stage-II assets.
  3. Its stance of creating further Covid-19 buffer of Rs 3.5 billion (against its Q3 FY21 guidance of consuming the buffer).
  4. Elevated employee cost of Rs 2.7 billion (versus Rs 1.6 billion quarterly run-rate).

What helped offset this drag was sustained business momentum (14% assets under management growth) and consistently declining funding cost.

Click on the attachment to read the full report:

ICICI Securities Cholamandalam Q4FY21 Results Update.pdf

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