Motilal Oswal Home Finance Limited has disclosed its financial performance for the fiscal year 2023-24. The company witnessed a notable 10% increase in total revenue, reaching Rs. 589 crore, compared to Rs. 531 crore in FY23. Concurrently, total expenses also surged by 10%, reaching Rs. 417 crore from Rs. 356 crore in the previous fiscal year.

Despite the growth in revenue, the Profit Before Tax (PBT) experienced a slight decline of 2.4%, standing at Rs. 171.2 crore in FY24, down from Rs. 175.5 crore in FY23. Similarly, the Profit After Tax (PAT) saw a decrease of 2.78%, amounting to Rs. 132.5 crore, compared to Rs. 136.3 crore in the preceding fiscal year. Consequently, the Earnings Per Share (EPS) for FY24 dipped to Rs. 0.22 from Rs. 0.23 in FY23.

In terms of balance sheet metrics, the company's total assets grew by 10% to Rs. 455 crore, up from Rs. 414 crore in FY23, mirroring the increase in total liabilities, which also amounted to Rs. 455 crore, from Rs. 414 crore in the previous fiscal year.

Furthermore, the company demonstrated improved cash flow performance in FY24. Cash generated from operating activities totaled Rs. 39.30 crore, reversing the negative cash flow of Rs. 239.18 crore observed in FY23. Additionally, cash generated from investing activities increased to Rs. 21.40 crore, compared to Rs. 4.66 crore utilized in FY23. Similarly, cash generated from financial activities amounted to Rs. 107.59 crore, a notable improvement from Rs. 287.85 crore in FY23.

 Key Highlights 

1. Profit After Tax (PAT): Reported ₹133 crore in FY 2024.

2. Disbursements: Crossed the ₹1,000 crore mark, reaching ₹1,018 crore in FY 2024, indicating potential for stronger growth.

3. Credit Rating: Maintained a robust "AA/Stable" rating from CRISIL, ICRA, and India Rating.

4. Team Structure: Operates with independent Sales, Credit, Collection, and Operations teams, totaling over 1,900 employees.

5. Cost of Borrowing: Stood at 8.3%. Raised ₹1,337 crore of long and short-term funds in FY 2024.

6. Composition of Loan Book: New Book, originated post-April 2018, contributed around 58% of the loan book with Gross Non-Performing Assets (GNPA) of 0.3%.

7. Liability Mobilizations: Demonstrated strong mobilization from various banks and institutions at competitive rates.

8. Partnership: Collaborated with the U.S. Development Finance Corporation in FY 2022, receiving a commitment of USD 50 million and receiving balance tranches aggregating to USD 20.0 million during the year.

Valuation

The valuation at a P/B ratio of 7x appears excessively high, especially given the minimal growth in both revenue and profit in Fy24.