Geojit BNP Paribas has reported a 21 per cent decline in consolidated revenue in the second quarter at Rs 52.49 crore from Rs 66.21 crore in the corresponding period of the previous fiscal.
For the six months ended September, the consolidated revenue was Rs 111.83 crore compared to Rs 125.06 crore of the same period of the previous year.
The Board has decided to make full provision, in terms of RBI Prudential norms for NBFC, against its indirect exposure of Rs 131.34 crore of Geojit Credits - a 65 per cent owned subsidiary - to National Spot Exchange Ltd by way of loans given to clients. This is consequent to the payment crisis in NSEL and the provision is shown as an exceptional item.
As a result, during the quarter, the company will report a net consolidated loss of Rs 94.20 crore. Although 100 per cent provision is made in the books of the registered NBFC - Geojit Credits, the company is taking all efforts to recover dues from NSEL, and as and when the recovery is made, provision will be reversed to that extent.
The decline in revenue this quarter is also due to the absence of institutional brokerage income, pursuant to the completion of the sale of institutional brokerage JV in the first quarter of this fiscal.
Excluding exceptional item, the PBT for the second quarter stood at Rs 12.50 crore as against Rs 18.51 crore of same quarter of the previous fiscal recording a decline of 33 per cent.
For the half year, the PBT before exceptional item stood at Rs 29.13 croreas against Rs 32.18 crore for the same period of the previous year, registering a decline of 10 per cent.
C.J.George, Managing Director of Geojit BNP Paribas said, “at this moment the payment crisis of NSEL is under investigation by multiple regulators and agencies. The company is hopeful of recovering the dues during the course of time.”
“During the second quarter, due to a variety of factors, including NSEL scam, the retail activity in the capital market was subdued. However, the third quarter has started seeing improvement in the retail activity in the capital market, reflecting in higher volumes”, he added.