Five-Star Business Finance has posted a 32 per cent year-on-year growth in its first quarter net profit at ₹184 crore led by strong growth in disbursements and higher interest income. 

The Chennai-based non-banking finance company (NBFC) posted a net profit of ₹139 crore for the corresponding quarter of the previous fiscal. 

Five-Star Business Finance primarily offers small loans for business purposes, asset creation and other economic purposes to small business customers and self-employed individuals. Its total disbursement doubled to ₹1,132 crore during the latest quarter against ₹568 crore in Q1FY23. 

Total assets under management (AUM) of the company stands at ₹7,583 crore as of June 2023 against ₹5,297 crore at the end of the same quarter of the previous fiscal. 

Lakshmipathy Deenadayalan, Chairman & Managing Director, said the company continues to build on the strong business and disbursal momentum built in Q4FY2023. “We added 13 branches during Q1FY24 resulting in a strong branch network of 386 branches.” 

Total income of the company grew by 42 per cent year-on-year to ₹480 crore (₹338 crore). Out of which, interest income went up by 32 per cent to ₹464 crore (₹335 crore). 

Deenadayalan said, on the collections front the company saw stronger than typical Q1 numbers. “We had a collection efficiency of 99.6 per cent for the quarter.” He, however added that there was a marginal increase in non-performing assets (NPA) numbers at 1.41 per cent in Q1FY24 as against 1.36 per cent in Q4FY23 but added that it is a typical Q1 phenomenon. 

Shares of Five-Star Business Finance closed 1.25 per cent higher on NSE at ₹730.20 on Friday.

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