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IDFC
Key highlights of 4QFY11 earnings
In 4QFY11, IDFC delivered NII growth largely in line with asset growth in the
lending business. The reported spreads came down 50bps yoy to 2.2% in FY11
(down 20bps qoq). However, most of the non-interest and fee based revenue
streams posted lackluster performance.
Lending business: NII growth largely inline with asset growth
! Net interest income (NII) on infrastructure assets increased 47% yoy to Rs 4.3bn in4QFY11
(+47% yoy to Rs 15bn in FY11) and NII on treasury operations went up 81% yoy to about Rs
0.5bn in 4QFY11 (+50% yoy to Rs 1.4bn in FY11). The net interest margins (NIMs) in
infrastructure lending business improved 20bps yoy to 3.5% in FY11 while the margins in the
treasury business were largely stable yoy at 30bps.
! The overall reported spreads came down 50bps yoy to 2.2% in FY11 (down 20bps qoq on a
rolling 12 month basis). However, the reported overall NIMs went up 20bps yoy to 3.8% in
FY11 (stable qoq), partly on account of benefit of equity raised in 1HFY11.
! Adjusted core lending related fee income increased by 35% yoy to Rs 1.94bn. However, there
is a moderation in fee income in 4QFY11, which may be partly on account of the moderation
in sanctions and disbursements.
! Adjusted operating expenses grew by 3.5%yoy in FY11. Operating costs to income ratio was
at 21% in FY11 compared to 26% in FY10.
! In FY11, net interest income to average assets increased by 20bp qoq to 3.8%. Non-interest
income was down 100bps to 2.1%. However, operating expenses to assets fell 60bps to
1.2%. On balance, the reported ROAs came down 40bps yoy to 3.0% in FY11.
! Consolidated net profit was Rs 12.8bn in FY11 (+21% yoy). Reported EPS was Rs 8.8 in
FY11 (Rs 8.2 in FY10)
Business growth appears to have moderated in 4QFY11
! Loans grew by 50% yoy (+7% qoq) in FY11. Gross approvals increased 40% yoy in FY11 (-
55% yoy in 4QFY11) and disbursements increased 106% yoy in FY11 (-16% yoy in 4QFY11).
! Of the outstanding exposure as of March 2011 - Energy accounted for 42%, transportation
25%, telecom 22% and rest is in other sectors.
! Asset quality continues to remain stable (0.1% net NPLs as of March 2011)
Other businesses post lacklustre performance
! In FY11, income from investment banking and broking increased by 9% yoy to Rs 2bn.
! All other businesses saw a yoy decline in income. Income from principal investments fell by
27% yoy to Rs 1.9bn in FY11 and asset management (mutual fund/ alternatives) income fell
by 20% yoy to Rs 2.9bn.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
IDFC
Key highlights of 4QFY11 earnings
In 4QFY11, IDFC delivered NII growth largely in line with asset growth in the
lending business. The reported spreads came down 50bps yoy to 2.2% in FY11
(down 20bps qoq). However, most of the non-interest and fee based revenue
streams posted lackluster performance.
Lending business: NII growth largely inline with asset growth
! Net interest income (NII) on infrastructure assets increased 47% yoy to Rs 4.3bn in4QFY11
(+47% yoy to Rs 15bn in FY11) and NII on treasury operations went up 81% yoy to about Rs
0.5bn in 4QFY11 (+50% yoy to Rs 1.4bn in FY11). The net interest margins (NIMs) in
infrastructure lending business improved 20bps yoy to 3.5% in FY11 while the margins in the
treasury business were largely stable yoy at 30bps.
! The overall reported spreads came down 50bps yoy to 2.2% in FY11 (down 20bps qoq on a
rolling 12 month basis). However, the reported overall NIMs went up 20bps yoy to 3.8% in
FY11 (stable qoq), partly on account of benefit of equity raised in 1HFY11.
! Adjusted core lending related fee income increased by 35% yoy to Rs 1.94bn. However, there
is a moderation in fee income in 4QFY11, which may be partly on account of the moderation
in sanctions and disbursements.
! Adjusted operating expenses grew by 3.5%yoy in FY11. Operating costs to income ratio was
at 21% in FY11 compared to 26% in FY10.
! In FY11, net interest income to average assets increased by 20bp qoq to 3.8%. Non-interest
income was down 100bps to 2.1%. However, operating expenses to assets fell 60bps to
1.2%. On balance, the reported ROAs came down 40bps yoy to 3.0% in FY11.
! Consolidated net profit was Rs 12.8bn in FY11 (+21% yoy). Reported EPS was Rs 8.8 in
FY11 (Rs 8.2 in FY10)
Business growth appears to have moderated in 4QFY11
! Loans grew by 50% yoy (+7% qoq) in FY11. Gross approvals increased 40% yoy in FY11 (-
55% yoy in 4QFY11) and disbursements increased 106% yoy in FY11 (-16% yoy in 4QFY11).
! Of the outstanding exposure as of March 2011 - Energy accounted for 42%, transportation
25%, telecom 22% and rest is in other sectors.
! Asset quality continues to remain stable (0.1% net NPLs as of March 2011)
Other businesses post lacklustre performance
! In FY11, income from investment banking and broking increased by 9% yoy to Rs 2bn.
! All other businesses saw a yoy decline in income. Income from principal investments fell by
27% yoy to Rs 1.9bn in FY11 and asset management (mutual fund/ alternatives) income fell
by 20% yoy to Rs 2.9bn.
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