Indiabulls Housing Finance on Friday reported an 86 percent plunge in consolidated net profit at Rs 137 crore for the March quarter due to higher provisioning.

The non-banking finance company had posted a net profit of Rs 1,006 crore during the corresponding January-March period of the preceding fiscal.

Total income (consolidated) during the March quarter also fell to Rs 2,954 crore as against Rs 4,344 crore in the same period of 2018-19, Indiabulls Housing Finance said in a regulatory filing.

The company said it has chosen to adopt a conservative approach on account of macro uncertainties resulting from COVID-19 and made provisions for 1 percent of its loan book, that is Rs 700 crore.

“Adjusted for the COVID-19 related provisions… normalized PAT for the company for the quarter is Rs 841 crore, and for full FY20 is Rs 2,904 crore,” it said in a release.

The special provisioning has taken the total provision to 5.4 percent of the total loan book at Rs 3,741 crore, which is 218 percent of its gross NPAs of 1.8 percent, the company’s Deputy Managing Director Ashwini Hooda said in a post-earnings concall.

The lender’s normal provisioning coverage used to be 70 percent of the net bad loans, he said, effectively making it zero net NPAs or bad loans.

He said the company’s March quarter disbursement had come down to a third of what it used to lend normally before the IL&FS bankruptcy in September 2018 whacked the industry. In the reporting quarter, its fresh disbursals came down to Rs 3,300 crore from around Rs 10,000 crore in the year-ago quarter.

For the full year to March, its net income nearly halved, even excluding the additional COVID-19 provisions, from Rs 4,090 crore to Rs 2,904 crore and including this, it stood at Rs 2,200 crore.

Its balance sheet came down to Rs 1,02,872 crore from over Rs 1,25,000 crore a year ago. Loan book fell to Rs 69,676 crore as on March 31, 2020, from Rs 91,530 crore by end of March 2019.

“Rs 1,802 crore of profit on fair valuation of holding in OakNorth Bank has been routed through Other Comprehensive Income (OCI), instead of the P&L (profit & loss) as required by IndAS. Of this, Rs 1,798 crore has been debited to OCI to create extra provisions,” the company said.

The company has effectively achieved zero net NPA status and now carries Rs 2,391 crore of extra provisions, representing 3.4 percent of the loan book, for navigating through COVID-19 and post coronavirus periods, it said.

The company’s capital adequacy stood at 27.09 percent of which the core tier-1 is at 20.31 percent and liquidity buffer at Rs 13,410 crore or 13 percent of its balance sheet.

Further, the board has approved raising up to USD 300 million and appointment of Achutan Siddharth as an independent director.

Indiabulls Housing shares closed at Rs 230.95 apiece on BSE, up 2.58 percent from the previous close.

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