Money & Banking

L&T Finance puts IL&FS saga behind it; posts 2% rise in profit

Our Bureau Mumbai | Updated on July 19, 2019 Published on July 19, 2019

Diversified non-banking financial company L&T Finance registered a 2 per cent increase in profit after tax at ₹549 crore in the June quarter, against ₹538 crore posted in the corresponding quarter a year ago.

Total income grew 16.37 per cent to ₹3,689.50 crore (₹3,170.42 crore). Net interest margin and fees increased 6.76 per cent for the first quarter of the fiscal, against 6.58 per cent a year ago. “This was after normalising the impact of Infrastructure Leasing and Financial Services,” L&T Finance said in a statement on Friday.

The company said its lending book grew by 16 per cent to ₹99,904 crore (₹86,321 crore). Its provision coverage was at 60.83 per cent in the quarter under review, compared to 61.99 per cent a year ago.

“As per the latest resolution plan submitted by the IL&FS management, five out of six special purpose vehicles amounting to ₹1,696 crore out of ₹1,816 crore will now be ‘Green’. Consequently, interest income of ₹84 crore that was deferred in the fourth quarter is now being recognised,” it said, adding that it has also taken conservative and commercially prudent view to mark down 50 per cent (₹284 crore) of its total exposure (including principal and accrued interest) to a housing finance company.

It further said it maintains positive asset-liability gaps in all buckets of up to one year and maintained liquidity of ₹13,133 crore (including ₹4,855 crore in the form of cash FDs and other liquid instruments) and has already complied with key features of the draft liquidity risk management framework for NBFCs and core investment companies issued by the RBI.

The L&T Finance scrip fell 5.72 per cent and closed at ₹110.50 apiece on the BSE.

Published on July 19, 2019

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