Shriram City Union Finance Ltd, a retail financing NBFC of the Shriram Group, has indicated that the company’s merger with Shriram Transport Finance Ltd is expected to become effective in Q4 of this fiscal. It is awaiting the listing of its application for hearing at NCLT, which is the last leg of the merger process, while announcing its impressive financial performance for the March 2022 quarter and FY22.

“While we are waiting for the approvals of IRDAI and Competition Commission of India, we now await the listing of our application for a hearing at NCLT. The process of obtaining all other regulatory approvals as applicable is proceeding as scheduled. The merger will stand effective after obtaining NCLT approval. All processes are expected to be completed by this December,” said YS Chakravarti, MD & CEO of Shriram City Union Finance Ltd.

In preparation for the merger, a pilot project under which staff exchanges for cross-selling and other associated activities have been taken up.

Quarterly numbers

Meanwhile, the company has reported an 8 per cent growth in its standalone profit after tax at ₹303 crore for the quarter ended March 31, 2022, as compared to ₹282 crore in the year-ago period, aided by a double-digit rise in net interest income. March 2022 quarter PAT was the company’s highest-ever quarterly profit.

Its net interest income grew by 14 per cent at ₹1,057 crore as against ₹930 crore in Q4 of FY21 on the back of its highest-ever quarterly interest income at ₹1,751 crore as against ₹1,481 crore, an increase of 18 per cent. The net interest margin is higher at 12.93 per cent (12.80 per cent). Covid-related provisioning at the end of Q4FY22 stood at ₹426 crore.

Its collection efficiency was at 103 per cent in January and February this year, and in March, it stood at 111 per cent. March 2022 quarter collection efficiency was at 106 per cent.

Its disbursements for March 2022 quarter stood at ₹7,527 crore as against ₹6,570 crore in the year-ago period, an increase of about 15 per cent.

The company saw improvements in asset quality as gross NPA for Q4FY22 declined to 6.31 per cent as compared to 7.30 per cent in Q3FY22 (both figures are per RBI’s November 2021 Circular).

For the full year FY22, the company’s standalone PAT stood at ₹1,086 crore as compared to ₹.1,011 crore in FY21, an increase of 7.4 per cent. Net interest income was higher by 11 per cent at ₹3,998 crore (₹3,604 crore). Provisions and write-offs were higher at ₹888 crore (₹851 crore).

Its standalone loan disbursements saw a sharp rise of 52 per cent at ₹26,140 crore in FY22 as compared to ₹17,154 crore in the previous fiscal. “These have been our best ever disbursements in a financial year,” he said.

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