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Five Star Business Finance Ltd., on Tuesday posted a 43 per cent growth in its fourth quarter net profit at ₹169 crore, boosted by strong growth in loan disbursals and collections.
The Chennai-based Non-Banking Financial Company (NBFC) posted a net profit of ₹118 crore for the corresponding quarter of FY22.
The company primarily offers small loans for business purposes, asset creation, and other economic purposes to micro-entrepreneurs and self-employed individuals.
The lender’s disbursements for the March 2023 quarter stood at ₹1,110 crore, 72 per cent higher than the disbursals in Q4FY22. The company’s interest income grew by 35 per cent, year-on-year, to ₹423.4 crore in Q4FY23, compared ₹313.6 crore in the last quarter of FY22.
Also read: Spotlight: We want to be known as a business loan company, says Five Star Business Finance CEO
In its earnings release, Lakshmipathy Deenadayalan, CMD, Five Star Business Finance Ltd, said, the company witnessed the best quarter in Q4 with both business and collections registering extremely strong numbers. “We added 73 branches during FY23 resulting in a strong branch network of 373 branches,” he said.
Strong disbursal
For the full year, the company’s disbursal nearly doubled to ₹3,391 crore in FY23 against ₹1,756 crore in FY22. The total assets under management (AUM) of the company as of March 2023 stood at ₹6,915 crore, recording a 37 per cent growth from the asset size of ₹5,067 crore in FY22.
The company’s net profit jumped 33 per cent in FY23 to ₹603 crore against ₹454 crore in FY22. Interest income for the full year was up by 25 per cent to ₹1,499 crore (₹1,204 crore) in FY23.
Non-performing assets (NPA) went up to 1.36 per cent of the total assets in FY23 from 1.05 per cent in FY22.
Five Star Business Finance made a mute market debut on November 21, 2022. The stock listed at discount on BSE and NSE at ₹449.95 and ₹468.80 apiece respectively against its issue price of ₹474 per share.
On Tuesday, stocks of Five Star Business Finance closed at ₹543.85 apiece on NSE, 5.14 per cent higher than Monday’s closing price.
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