What’s driving growth for Chola Investment? CFO Arul Selvan answers

economictimes.indiatimes.com:

Arul Selvan, President & CFO, Chola Investment & Fin, says “in Q1, the asset quality will slightly deteriorate because there would have been a lot of collection efforts going in Q4 because of the year-end, et cetera. So Q1 will always have a slight reversal of asset quality trend. In our case, we have just moved the stage 3 by 5 bps.

As a matter of fact, the RBI-NPA norms, we have reduced from where we were at, from 4.6 to 4.3. So asset quality is performing much better than what it was pre-Covid on a normal, turn of quarter-on-quarter basis, which used to happen in a pre-Covid scenario.Despite Q1 being seasonally weak, Chola Investment AUM has been healthy. Will you be revisiting your guidance now and what segments are driving your growth?We have grown across all the verticals.

Vehicle finance has grown by around 32% and loan against property has also grown by around 32%. Home loan is an old business but we are growing in other parts of the country and we are focussing more on the south and a little bit on the west. Now, we are going north and east.

So, it has grown substantially, registering a growth of around 138%. The small and medium enterprise, the SME business has grown substantially by around 100%. These are new businesses.

All the new businesses have grown by almost 100% plus because their base is small. But the existing business has also done well by registering a reasonably good growth of around 30% plus. All put together has delivered this growth and we expect the momentum to continue.The overall sentiment looks good with healthy disbursements, but of late, there have been reports of inventory piling up at dealerships. What is your sense on the credit demand going forward, especially in vehicle finance?We are