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Murugappa group’s Cholamandalam Investment and Finance Company recorded a 37 per cent increase in its net profit at ₹431 crore for the quarter ended June 30 when compared with ₹314 crore in the year-ago quarter.
Total income of the company grew four per cent to ₹2,114 crore in the June quarter as against ₹2,030 crore recorded in the same quarter previous fiscal, said a company statement.
Profit before tax (PBT) of the NBFC stood at ₹581 crore (₹483 crore).
Total disbursements during the April-June 2020 period fell 58 per cent to ₹3,589 crore (₹8,572 crore). Vehicle finance business generated ₹3,231 crore as against ₹6,940 crore. The disbursements were predominantly in tractors, two-wheelers, construction equipment and used business segments.
Loan Against Property (LAP) business disbursed ₹119 crore as against ₹1,101 crore. Assets under management grew 13 per cent at ₹70,826 crore (₹62,827 crore in the year-ago quarter).
“It was a challenging quarter for the NBFC industry with muted disbursements and a slowdown in repayments due to the moratorium and lockdown. Chola’s response was comprehensive, with our treasury ramping up liquidity, our tech team identifying and deploying digital interventions for disbursements and collections and more importantly, our business teams adapting to the new normal of driving business despite working away from offices,” said Arun Alagappan, Managing Director.
“The quarter gone by helped us critically evaluate our expenses, with an improvement already visible – our opex ratio has come down to 2.2 per cent from 2.6 per cent just a quarter before. During the quarter, we have initiated a comprehensive process transformation programme for the vehicle finance business. The LAP business has rolled out its newly developed Loan Origination and Loan Management System during the quarter gone by,” he added.
The company has not availed of moratorium so far on its borrowings. It holds a liquidity position with ₹7,169 crore as cash balance as of June 2020 with a total liquidity position of ₹11,677 crore (including undrawn sanctioned lines). The ALM is comfortable with no negative cumulative mismatches across all time buckets.
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