AB Capital shares in focus post healthy Q3 results, housing fin unit getting growth capital

Shares of Aditya Birla Capital Ltd. are in focus on Wednesday, February 4, after the company reported a healthy set of third quarter earnings.

Its profit after tax increased 28.7% to ₹772 crore from ₹600 crore in the previous year, its net interest income was up 22.7% at ₹2,127 crore and pre-provision operating profit (PPOP) was up 22.2% at ₹1,458 crore.

Its net interest margins (NIMs) increased to 6.12% sequentially from 6.06%.

AB Capital's return on assets (ROA) expanded to 2.25% from 2.2% in the previous quarter. The NBFC's management said the RoA will expand to 2.5% levels in the next four to five quarters.

It reported an assets under management (AUM) growth of 24% to ₹1.48 lakh crore from ₹1.19 lakh crore.

Its housing finance business' AUM grew 48% from the previous year to 42,000 crore with RoA of 1.96% from 1.82% in the previous quarter.

AB Capital's board had also approved a capital infusion of ₹2,750 crore in ABHFL from one of the entities of Advent International, confirming a CNBC-TV18 newsbreak.

Meanwhile, its AMC business registered a 11% growth from the previous year in domestic AUM to ₹4.43 lakh crore.

For the life insurance business, the value of new business (VNB) margins expanded by 300 basis points sequentially to 14.6%.

For the health insurance business, the combined ratio is now at 111% from 114% in the previous year. It gained market share to 14.2%, up 210 basis points from the previous year.

AB Capital shares ended the previous session 4.2% higher at ₹346.9 apiece. The stock has gained 107% in the past year.

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