Arul Selvan D, president and CFO, Cholamandalam Investment & Finance Company Limited
The US tariffs have created heightened uncertainty among businesses, prompting them to hold back investments on future growth, as per an executive at Cholamandalam Investment & Finance Company Limited (CIFCL).
“It will ultimately settle down to some point but now this tariff issue has come up again; they [US] has said 25 per cent but then again there is a wild card in the name of penalty… This ambiguity is what is making people not take orders and they are sort of waiting on the fence,” Arul Selvan D, president and CFO, CIFCL, said.
The Murugappa Group NBFC is engaged in vehicle finance, home loans, mortgage loans, SME loans and more recently gold loans, and though it isn’t directly involved in capital investment lending, Selvan notes a fall out as inadequate capex impacts consumption and other downstream segments. “This is more a secondary follow, but it still has its implications,” he added.
Announcing its results for the June quarter last week, CIFCL said that total assets under management (AUM) as of June 30, 2025 was at ₹2,07,663 crore (up 23 per cent y-o-y). Aggregate disbursements remained flat in Q1 FY26 were at ₹24,325 crore as against ₹24,332 crore in Q1 FY25.
Given the ambiguity surrounding both tariffs and the monsoons currently, CIFCL is now guiding for a growth of 20-23 per cent in AUM in FY26, compared to an original growth rate it anticipated of about 23-25 per cent. “As long as the monsoon is reasonable, we should still be able to clock it,” Selvan said. The NBFC grew around 27 per cent growth in FY25. “The credit demand and growth is largely dependent on how the monsoons fare and when the geopolitical issues settle,” he added.
With regard to disbursements remaining flat this quarter, the CFO said that during the quarter, they took up the exercise of analysing product lines and pursue only those profitable and phase out some of the less profitable lines. “The consumer loans under fintech partnerships were unprofitable because they were leading to slightly higher losses. So, there, we have already started slowing down from Q4FY25 and now in Q1FY26 we completely stopped disbursement,” he said.
However, one area the company is bullish on, is gold loan business, which it recently entered in April, in select geographies. The company disbursed close to ₹100 crore in gold loans in Q1FY26 and anticipates the AUM under this segment to hit ₹800-1,000 crore by end of the fiscal, owing to the demand.
Published on August 3, 2025