PAISALO DIGITAL 2023-24 Annual Report Analysis

Thu, 29 Aug

PAISALO DIGITAL has announced its results for the year ended March 2024. Let us have a look at the detailed performance review of the company during the year 2023-24.

PAISALO DIGITAL Income Statement Analysis

• Interest income during the year rose 27.9% on a year-on-year (YoY) basis.
• Interest expenses were up by 14.9% YoY during the same period.
• Operating expenses declined by 5.6% YoY during the year.
• The company's net interest income (NII) increased by 38.1% YoY during the fiscal. Consequently, net interest margins (NIM) witnessed a decline and stood at 583.1% in FY24 as against 1005.5% in FY23.
• Other income declined by 50.4% YoY during the year.
• Net profit for the year increased by 89.1% YoY.
• Net profit margins during the year increased to 29.3% in FY24 from 19.8% in FY23.

PAISALO DIGITAL Income Statement – 2023-24

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Interest Income	Rs m	4,732	6,050	27.9%
Other Income	Rs m	1	1	-50.4%
Interest Expense	Rs m	2,087	2,398	14.9%
Net Interest Income	Rs m	2,645	3,652	38.1%
Operating Expense	Rs m	1,313	1,239	-5.6%
Pre-provision Operating Profit	Rs m	1,333	2,413	81.0%
Provisions & Contingencies	Rs m	10,759	9,856	-8.4%
Profit before tax	Rs m	1,262	2,385	89.0%
Tax	Rs m	326	615	88.6%
Profit after tax	Rs m	936	1,770	89.1%
Minority Interest	Rs m	0	0	0.0%
Net Interest Margin	%	1005.5	583.1
Net profit margin	%	19.8	29.3

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PAISALO DIGITAL Balance Sheet Analysis

• The company's deposits during FY24 stood at Rs 0 m as compared to Rs 0 m in FY23, thereby witnessing an increase of 0.0%.
• Advances for the year stood at Rs 0 m as compared to Rs 0 m during FY23, a rise of 0.0%.
• Cost of deposits for PAISALO DIGITAL rose 0.0% and stood at 0.0%, while yield on advances rose to 0.0%.
• The lender's investments rose to Rs 626 m during the year from Rs 263 m in FY23.
• Borrowing stood at Rs 6.9 bn, a fall of 34.2% as compared to previous year.
• Overall, the total assets and liabilities for FY24 stood at Rs 39.6 bn as against Rs 34.4 bn during FY23, thereby witnessing a rise of 15.4%.

PAISALO DIGITAL Balance Sheet – as on March 2024

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*	% Change
Networth	Rs m	11,625	13,147	13.1%
Advances	Rs m	0	0	0.0%
Deposits	Rs m	0	0	0.0%
Yield on advances	%	0.0	0.0
Cost of Deposits	%	0.0	0.0
Investments	Rs m	263	626	138.1%
Borrowings	Rs m	10,427	6,866	-34.2%
Total Assets	Rs m	34,364	39,643	15.4%

Current Valuations for PAISALO DIGITAL

• The trailing twelve-month earnings per share (EPS) of the company stands at Rs 2.0, an improvement from the EPS of Rs 2.1 recorded last year.
• The price to earnings (P/E) ratio, at the current price of Rs 63.5, stands at 30.6 times its trailing twelve months earnings.
• The price to adjusted book value (P/ABV) ratio at current price levels stands at 4.3 times, while the price to income ratio stands at 9.0 times.

Per Share Data/Valuations

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Income per share (Unadj.)	Rs	10.5	6.7
Earnings per share (Unadj.)	Rs	2.1	2.0
Diluted earnings per share	Rs	1.0	2.0
Avg P/E ratio	Rs	35.2	30.6
Avg P/ABV ratio	Rs	2.2	4.3
Avg Market Cap	Rs	32,940	54,166
Dividends per share (Unadj.)	Rs	0.10	0.10

Ratio Analysis for PAISALO DIGITAL

• Efficiency Ratios

  Credit/Deposit Ratio: The company's credit/deposit ratio improved and stood at 0.0x during FY24, from 0.0x during FY23. The credit/deposit ratio tells us how much money a company has raised in the form of deposits and has deployed as loans.

  Debt to Equity Ratio: The company's debt to equity ratio decreased and stood at 0.52x during FY24, from 0.90x during FY23. The debt to equity ratio of a company tells us how much debt a company uses relative to its equity.

• Liquidity Ratios

  Capital Adequacy Ratio (CAR): PAISALO DIGITAL's capital adequacy ratio (CAR) was at 0.0% as on 31 March 2024 as compared to 40.3% a year ago. This ratio helps measure the financial strength of the company or any finance company to meet their obligations using their assets and capital.

  A company that has a good CAR has enough capital to absorb potential losses. Thus, it has less risk of becoming insolvent and losing depositor's money.

  Provision Coverage Ratio (PCR): Apart from CAR, you also need to take a look at the company's PCR and LCR ratios. Provisioning coverage ratio (PCR) is the percentage of funds that a company sets aside for covering losses due to bad debts.

  So a high PCR ratio means asset quality issues are under control and the company is not vulnerable.

  Liquidity Coverage Ratio (LCR): The LCR is designed to ensure that companies hold a sufficient reserve of high-quality liquid assets to allow them to survive a period of significant liquidity stress lasting 30 calendar days.

• Profitability Ratios

  Return on Equity (ROE): The return on equity (ROE) ratio for the company improved and stood at 13.5% during FY24, from 8.1% during FY23. The ROE measures the ability of a firm to generate profits from its shareholders capital in the company.

  Return on Assets (ROA): The return on asset (ROA) ratio of the company improved and stood at 4.47% during FY24, from 2.72% during FY23. The ROA measures how efficiently the company uses its assets to generate earnings.

  Return on Capital Employed (ROCE): The ROCE for the company improved and stood at 14.21% during FY24, from 11.22% during FY23. The ROCE measures the ability of a company to generate profits from its total capital (shareholder capital plus debt capital) employed in the company.

• NPA Ratios

  Gross NPA Ratio: The gross NPA ratio is the ratio of a company's gross NPAs to gross advances. PAISALO DIGITAL's gross NPA ratio stood at 0.0% as of 31 March 2024 compared to 0.7% in the same period a year ago.

  A high gross NPA ratio is a bad thing as it indicates how much of a company's loans are in danger of not being repaid.

  Net NPA Ratio: In simple language, net NPAs are simply the total non-performing assets minus the provision left aside. It gives you the exact value of NPAs after the company has made provisions.

  The net NPA ratio of PAISALO DIGITAL was 0.0% in financial year 2024. This compared with 0.0% a year ago.

Key Ratio Analysis

No. of Mths Year Ending		12 Mar-23*	12 Mar-24*
Credit/Deposit Ratio	x	0.0	0.0
Debt to Equity Ratio	x	0.9	0.5
Loans / Deposits	x	0.0	0.0
Capital Adequacy Ratio	%	40.3	0.0
Return on Equity	%	8.1	13.5
Return on Assets	%	2.7	4.5
Return on Capital Employed	%	11.2	14.2
% of Gross NPAs	%	0.7	0.0
% of Net NPAs	%	0.0	0.0
Yield on Advances	x	0.0	0.0
Yield on Investments	x	0.0	0.0

To see how PAISALO DIGITAL has performed over the last 5 years, please visit here.

PAISALO DIGITAL Share Price Performance

Over the last one year, PAISALO DIGITAL share price has moved up from Rs 28.3 to Rs 63.5, registering a gain of Rs 35.2 or around 124.6%.

Overall, the S&P BSE SENSEX is up 26.1% over the year.

(To know more, you can check out historical annual results for PAISALO DIGITAL here and quarterly results for PAISALO DIGITAL here)