KLM Axiva Q3FY25 Results Update

18 February 2025

• Financial Performance (Q3 FY25 vs Q3 FY24): KLM Axiva Finvest Limited reported a total income of ₹88 Cr in Q3 FY25, marking a 5.0% YoY growth from ₹83 Cr in Q3 FY24. This was driven by a rise in interest income, which increased 5.2% YoY to ₹839.61 Cr from ₹798.39 Cr in Q3 FY24. On the cost front, finance costs surged by 17.2% YoY to ₹48 Cr from ₹41, reflecting higher borrowing expenses. Employee expenses grew 9.2% YoY to ₹19 Cr from ₹17 Cr, while other expenses declined 17.6% YoY to ₹15 Cr from ₹18 Cr. Profit Before Tax (PBT) stood at ₹2 Cr, down 58.7% YoY from ₹6 Cr due to increased costs. Profit After Tax (PAT) was ₹90 lacs, registering a 78.9% YoY decline from ₹4 Cr in Q3 FY24. Earnings Per Share (EPS) for the quarter was ₹0.04, down significantly from ₹0.21 in Q3 FY24.
• Nine-Months Performance (9M FY25 vs 9M FY24): For the nine-month period ended December 31, 2024, KLM Axiva’s total income stood at ₹252 Cr, up 9.1% YoY from ₹231 Cr in 9M FY24. Interest income grew 9.8% YoY to ₹246 Cr, while other income declined 13.3% YoY to ₹6 Cr. Despite revenue growth, PBT declined 6.2% YoY to ₹15 Cr from ₹16 Cr, impacted by rising finance costs. PAT stood at ₹11 Cr, down 3.5% YoY from ₹12 Cr in 9M FY24. EPS for 9M FY25 was ₹0.50, compared to ₹0.57 in the previous year.
• Operational Metrics & Key Ratios (Q3 FY25 vs Q3 FY24): The debt-to-equity ratio rose to 6.03x, reflecting higher leverage. The net profit margin declined to 4.45% from 5.14%, indicating profitability pressures. Gross Non-Performing Assets (GNPA) increased to 2.08% from 1.63%, while Net NPA (NNPA) also rose to 1.07% from 0.65%, signaling heightened asset risk. Meanwhile, the Capital Adequacy Ratio (CRAR - Tier I) stood at 15.72%, suggesting adequate capital buffers.
• Growth Outlook: KLM Axiva continued to achieve steady revenue growth, driven by higher interest income. However, rising borrowing costs and operational expenses significantly impacted profitability, leading to a contraction in net profit margins and EPS. While asset quality remains a focus, elevated leverage presents ongoing challenges. Moving forward, effectively managing cost pressures and maintaining loan book quality will be critical. Despite these headwinds, a stable CRAR and controlled NPA levels provide some resilience against market volatility. Enhancing cost efficiency and diversifying funding sources could help the company navigate the upcoming quarters more effectively.