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Selvan said the company’s net income margins can expand by 10-20 basis points.
The company is expecting new business to constitute around 15 percent of the overall book in the next two years, Selvan added.
As part of its Q1 earnings, Cholamandalam Investment and Finance Co reported a 28 percent year-on-year rise in net profit at Rs 726 crore versus a net profit of Rs 566 crore in the year-ago period.
Chola Investment & Fin's President & CFO, Arul Selvan, says that the asset quality for Q1 will deteriorate slightly as collection efforts were high due to end-of-year activities in Q4. However, Chola Investment AUM has seen healthy growth across all verticals, especially vehicle finance and SME business. The cost of funds is expected to moderate going forward, and the new rate book for vehicle finance will take at least three to four quarters to reflect the new rates. Despite provisions tripling, the asset quality is performing much better than pre-COVID on a quarter-on-quarter basis.