Podcast
Questions and Answers
Who is the Chairman and Managing Director of Five-Star Business Finance Limited?
Who is the Chairman and Managing Director of Five-Star Business Finance Limited?
- Shalini Baskaran
- Srikant Gopalakrishnan
- Lakshmipathy Deenadayalan (correct)
- Rangarajan Krishnan
What is the purpose of the enclosed transcript mentioned in the communication?
What is the purpose of the enclosed transcript mentioned in the communication?
- To summarize the annual report
- To announce a new product launch
- To provide details of the Earnings Conference Call (correct)
- To comply with regulatory filings
What is the scrip code for Five-Star Business Finance Limited listed on BSE?
What is the scrip code for Five-Star Business Finance Limited listed on BSE?
- FSBFL
- FIVESTAR
- FST Finance
- 543663 (correct)
Who acted as the moderator during the Earnings Conference Call?
Who acted as the moderator during the Earnings Conference Call?
Which regulation is referenced regarding the disclosure of the transcript?
Which regulation is referenced regarding the disclosure of the transcript?
What mode is established for participants during the conference call?
What mode is established for participants during the conference call?
When was the Earnings Conference Call for the quarter ended June 30, 2024, held?
When was the Earnings Conference Call for the quarter ended June 30, 2024, held?
What should you do if you need assistance during the conference call?
What should you do if you need assistance during the conference call?
What metric should shareholders focus on for the next three to four quarters?
What metric should shareholders focus on for the next three to four quarters?
What change is being implemented to the branch structure?
What change is being implemented to the branch structure?
What was the AUM growth prediction for the full financial year?
What was the AUM growth prediction for the full financial year?
Why should shareholders avoid focusing on run rate per branch?
Why should shareholders avoid focusing on run rate per branch?
What was the disbursement growth percentage in Q4?
What was the disbursement growth percentage in Q4?
What was the AUM growth in the first quarter mentioned?
What was the AUM growth in the first quarter mentioned?
What impact was anticipated in June and why?
What impact was anticipated in June and why?
What is the projected business run rate after splitting a super branch?
What is the projected business run rate after splitting a super branch?
What was the year-on-year growth of total income for Five-Star in the June quarter?
What was the year-on-year growth of total income for Five-Star in the June quarter?
What was the highest recorded profit after tax (PAT) for Five-Star in a single quarter as stated?
What was the highest recorded profit after tax (PAT) for Five-Star in a single quarter as stated?
What is the current return on equity (ROE) for Five-Star as mentioned in the report?
What is the current return on equity (ROE) for Five-Star as mentioned in the report?
What percentage of growth did Five-Star experience in active loans year-on-year?
What percentage of growth did Five-Star experience in active loans year-on-year?
What was the cost of funds for Five-Star as reported?
What was the cost of funds for Five-Star as reported?
Which of the following best describes the trend in the ticket size for loans at Five-Star?
Which of the following best describes the trend in the ticket size for loans at Five-Star?
What is the yield percentage being maintained by Five-Star?
What is the yield percentage being maintained by Five-Star?
What was the quarter-on-quarter (Q-on-Q) growth percentage of profit after tax (PAT) from March to June?
What was the quarter-on-quarter (Q-on-Q) growth percentage of profit after tax (PAT) from March to June?
What is now mandatory for customers before disbursement starting from May?
What is now mandatory for customers before disbursement starting from May?
What was a significant issue with the previously mandated NACH process?
What was a significant issue with the previously mandated NACH process?
What might prevent a customer from successfully making a UPI payment at the repayment date?
What might prevent a customer from successfully making a UPI payment at the repayment date?
What has been a result of making UPI autopay a compulsory precondition for disbursement?
What has been a result of making UPI autopay a compulsory precondition for disbursement?
What does the company primarily expect from the new UPI autopay requirement?
What does the company primarily expect from the new UPI autopay requirement?
What percentage of cases reported the adoption of the UPI autopay since its implementation?
What percentage of cases reported the adoption of the UPI autopay since its implementation?
Which of the following is NOT a reason why customers may fail to complete the NACH mandate post-disbursement?
Which of the following is NOT a reason why customers may fail to complete the NACH mandate post-disbursement?
What can customers do if they do not have the funds in their UPI account at the repayment date?
What can customers do if they do not have the funds in their UPI account at the repayment date?
What is the primary reason for the management overlays on ECL?
What is the primary reason for the management overlays on ECL?
What has contributed to the betterment of the Probability of Defaults (PDs) and Loss Given Defaults (LGDs)?
What has contributed to the betterment of the Probability of Defaults (PDs) and Loss Given Defaults (LGDs)?
What was the proportion of the current stage noted last year compared to this year?
What was the proportion of the current stage noted last year compared to this year?
What key time frame is used to ensure accurate PD and LGD assessments?
What key time frame is used to ensure accurate PD and LGD assessments?
What was the significant improvement in DPDs over the past years?
What was the significant improvement in DPDs over the past years?
What milestone did the company recently achieve?
What milestone did the company recently achieve?
How does the company ensure reliability of the identified numbers in its provisions?
How does the company ensure reliability of the identified numbers in its provisions?
What does the phrase 'management overlays' refer to in this context?
What does the phrase 'management overlays' refer to in this context?
What is the minimum seasoning period required before a customer can apply for a top up loan?
What is the minimum seasoning period required before a customer can apply for a top up loan?
What must a customer maintain to qualify for a top up loan?
What must a customer maintain to qualify for a top up loan?
How does the new top up loan relate to the existing loan?
How does the new top up loan relate to the existing loan?
What happens to the asset quality of the loan if there is any deterioration in either loan?
What happens to the asset quality of the loan if there is any deterioration in either loan?
What does the evaluation process for a top up loan include?
What does the evaluation process for a top up loan include?
If a customer has an old loan running for seven years and applies for a top up loan after three years, how long will the new loan run?
If a customer has an old loan running for seven years and applies for a top up loan after three years, how long will the new loan run?
What is a key requirement for a customer when applying for a top up loan?
What is a key requirement for a customer when applying for a top up loan?
Which of the following is NOT a factor checked during the evaluation of a top up loan?
Which of the following is NOT a factor checked during the evaluation of a top up loan?
Flashcards
Earnings Conference Call
Earnings Conference Call
A meeting where a company's management team presents their financial results to investors and analysts.
Fiscal Year (FY)
Fiscal Year (FY)
The financial period from April 1st to March 31st.
Q1 FY
Q1 FY
The first three months of a fiscal year. Starts from the beginning of April
Chairman & Managing Director (CMD)
Chairman & Managing Director (CMD)
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Chief Executive Officer (CEO)
Chief Executive Officer (CEO)
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Chief Financial Officer (CFO)
Chief Financial Officer (CFO)
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Scrip Code
Scrip Code
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Transcript
Transcript
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Assets Under Management (AUM)
Assets Under Management (AUM)
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Return on Assets (ROA)
Return on Assets (ROA)
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Return on Equity (ROE)
Return on Equity (ROE)
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Spread
Spread
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Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA)
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Quarter
Quarter
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Debt
Debt
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Ticket Size
Ticket Size
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Split Branches
Split Branches
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AUM (Assets Under Management)
AUM (Assets Under Management)
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Run Rate
Run Rate
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Disbursements
Disbursements
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Quarter (Q)
Quarter (Q)
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Year-on-Year (Y-o-Y) Growth
Year-on-Year (Y-o-Y) Growth
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Month (e.g., June, September)
Month (e.g., June, September)
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Guidance
Guidance
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Management Overlays
Management Overlays
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Probability of Default (PD)
Probability of Default (PD)
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Loss Given Default (LGD)
Loss Given Default (LGD)
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Historical Data in Credit Risk
Historical Data in Credit Risk
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Backtesting in Credit Risk
Backtesting in Credit Risk
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Days Past Due (DPD)
Days Past Due (DPD)
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Provisions for Credit Losses
Provisions for Credit Losses
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NACH Mandate
NACH Mandate
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UPI
UPI
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UPI Autopay
UPI Autopay
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Mandatory UPI Autopay
Mandatory UPI Autopay
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Inoperative Account
Inoperative Account
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Signature Mismatch
Signature Mismatch
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Structural Changes
Structural Changes
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What is a top-up loan?
What is a top-up loan?
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How is a top-up loan evaluated?
How is a top-up loan evaluated?
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What is the requirement for a top-up loan?
What is the requirement for a top-up loan?
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How do the top-up loan and the original loan run?
How do the top-up loan and the original loan run?
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What happens if there's a problem with the top-up loan?
What happens if there's a problem with the top-up loan?
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What is the company's approach to borrowing?
What is the company's approach to borrowing?
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How is the company changing its borrowing mix?
How is the company changing its borrowing mix?
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What is the desired borrowing mix?
What is the desired borrowing mix?
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Study Notes
Five-Star Business Finance Limited Earnings Conference Call - Q1 FY25
- Date: August 1, 2024
- Location: National Stock Exchange of India Limited, Mumbai; BSE Limited, Mumbai
- Management: Lakshmipathy Deenadayalan (Chairman & Managing Director), Rangarajan Krishnan (Chief Executive Officer), Srikanth Gopalakrishnan (Chief Financial Officer)
- Moderator: Sameer Bhise (JM Financial)
Key Financial Highlights (Q1 FY25)
- Asset Under Management (AUM): Crossed ₹10,000 crore in June 2024.
- Profit After Tax (PAT): ₹252 crore, a record high, representing a 37% increase yoy and a 7% increase qoq.
- Return on Equity (ROE): 18.95%, an all-time high in a quarter and expected to exceed 19% for the full year.
- Return on Assets (ROA): 8.23% for the quarter.
- Cost of Funds: 9.6% on book, decreasing to 9.47% incrementally.
- Disbursement: ₹1,318 crore in Q1 FY25 (almost flat compared to March Qtr).
- Collections: 98.5% efficiency in Q1 FY25.
- Branch Expansion: 27 new branches opened in Q1 FY25, bringing the total to 547.
- Digital Payments: Non-cash payments rose to 65% of total payments in Q1 FY25.
- Liquidity: Maintaining between 15-17% AUM as liquidity buffer.
Q&A Highlights
- Disbursement Growth: Moderating, but still expected to be around 20-22% qoq going forward.
- Employee Additions: Relatively flat in Q1 FY25, focused on splitting existing branches, not adding new ones.
- Cost-to-income: Remains low at about 34.34%, expected to stay in the 35%-36% range in the steady state.
- Credit Costs: Guiding for a credit cost in the 70-80 bps range for FY25.
- Borrowing Mix: Shifting towards capital markets, targeting 50% capital market borrowing and 50% bank borrowing in the long term.
- Leverage: Current leverage is around 2.3x. Looking to attain 3.75-4x in 2-3 years.
- Rural Markets: Maintaining a presence in rural areas while taking particular care to note the competitive situation in markets like Tamil Nadu.
- Digital Payments: The company is focused on pushing digital transactions. New strategies are in place for all new disbursement transactions to include UPI as a mandatory condition.
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Description
Test your knowledge about the recent Earnings Conference Call for Five-Star Business Finance Limited. This quiz covers topics such as the chairman's role, important metrics, and the conference call details. Perfect for finance professionals and shareholders looking to understand the company's performance.
