MAS Financial Services Q3 Results Review - Healthy Quarter; Pushing For Next Leg Of Growth: Axis Securities

Axis Securities Report

Disbursements grew by 23/6% YoY/QoQ driving assets under management growth of 27/7% YoY/QoQ with growth visible across segments. The wheels portfolio registered a robust growth of 68/13% YoY/QoQ on a lower base, while micro, small and medium enterprises growth was marginally lower at 18/4% YoY/QoQ (versus 20/6% YoY/QoQ).

The share of MSME loans (in standalone AUM) stood at ~81% versus 87/83% YoY/QoQ. The share of AUM sourced through the non-banking finance companies partners continued to decline and stood at 34.2% versus 39/36.6% YoY/QoQ.

Net interest income growth was in-line with our expectations and grew by 17/4% YoY/QoQ, driven by healthy growth. Non-interest income growth of 67/13% YoY/QoQ was led by better fee and commission income and higher DA income.

Opex growth continued to remain slightly elevated, growing at 23/7% YoY/QoQ. The cost-to-income ratio was stable QoQ at ~32%. Pre-provision operating profit grew by 35/6% YoY/QoQ. Credit costs were stable at ~1.5% QoQ. profit after tax growth was healthy at 24/3% YoY/QoQ.

The company carries a management overlay of ~Rs 19 crore (0.25% of book assets).

Asset Quality remained stable with gross non-performing assets/net non-performing assets at 2.23/1.48% versus 2.17/1.47% QoQ.

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