Non-banking financial company Magma Fincorp Ltd, backed by a clutch of private equity funds, is planning to raise funds to the tune of ₹500 crore soon.

According to V Lakshmi Narasimhan, CFO, Magma Fincorp, the company has already obtained the necessary clearances for raising the funds. The matter will now be placed before shareholders for approval.

He, however, did not give a time-frame by when the funds would be raised or the mode of raising the money. “We want to be ready for opportunities, if the scenario changes post the elections. Hence, we have made provisions for raising funds to the tune of ₹500 crore. We have yet to decide on the mode,” Narasimhan told reporters.

Results

On a consolidated basis, net profit for the quarter ended March 31, 2014 witnessed a 4.5 per cent decline to ₹42 crore (₹44 crore) because of higher finance charges and lower lending opportunities.

Consolidated finance cost during the quarter increased by approximately 12 per cent to ₹298 crore from ₹266 crore. On an annual basis, consolidated net profit stood at ₹152 crore, a 10 per cent increase, over the ₹138 crore it reported last fiscal.

Business

Magma’s net interest income (NII) for the period stood at ₹940 crore, while net interest margin was at 5.51 per cent.

According to the CFO, the loan book increased 10 per cent from a year earlier to ₹17,877 crore at the end of March, 2014. Disbursements were up only 5 per cent.

The gross NPA ratio stood at 3.6 per cent, while net NPA ration stood at 2.9 per cent.

“The worst is probably behind us. But we will continue to remain cautious. Focus will be on improving our yields and portfolio quality further,” he said. The board has meanwhile declared a dividend of 80 paise (or 40 per cent) on equity shares of ₹2 each.

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