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Two private equity firms — Creador Capital and Multiples Alternate Asset Management — are investing over Rs 100 crore each in Cholamandalam Investment and Finance Company Ltd.
Mr Brahmal Vasudevan, formerly a director at private equity firm ChrysCapital, launched the Asia-focused firm Creador Capital while Multiples is floated by the former ICICI Venture CEO, Ms Renuka Ramnath.
Cholamandalam Investment's board on Tuesday approved an issue of 1,32,55,454 equity shares of Rs10 each at Rs 160 a share aggregating to Rs 212.08 crore to them on a preferential basis.
Profit and revenue soars
Meanwhile, the net profit for the Chennai-based non-banking financial company increased over six times to Rs 68 crore for the third quarter ended December 31, 2011, as compared to Rs 10 crore for the same period last year. This was on the backdrop of a 59 per cent increase in revenue to Rs 475 crore (Rs 301 crore).
The company's board has declared an interim dividend of 15 per cent (Rs 1.50 a share) on the equity shares of the company for the year ended March 31, 2012, out of the profits of the company.
The company's Chief Financial Officer, Mr Arul Selvan, attributed to the better results on two counts — better disbursements in the mini- and light-commercial vehicle segments and lower credit losses. In the quarter ended December of last year, the company had to carry a personal loss of Rs 36 crore. This was not there this financial year leading to better profitability, he said.
Better disbursements
The company disbursed Rs1,915 crore in vehicle finance (Rs1,158 crore); disbursed Rs 368 crore in home equity loans (Rs 315 crore) and Rs 0.53 crore in gold (nil last year). The aggregate disbursements of the company for the quarter are Rs 2,283 crore (Rs 1,473 crore), registering a growth of 55 per cent.
During the quarter, the company sold Rs 705.16 crore worth of vehicle finance priority sector assets to banks. The company will recognise the gains over the tenure of the transaction as against recognition of profits upfront as in the previous financial years.
On the BSE, the stock price of Cholamandalam Investment closed at Rs 151.80, down by Rs 1.20 or 0.78 per cent over previous day's closing price.
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