Money & Banking

Mahindra Finance posts Q1 net loss of ₹1,573 crore

Our Bureau Mumbai | Updated on July 26, 2021

Total income declined 16 per cent to ₹2,567 crore

Amidst Covid related stress in rural and semi-urban markets, Mahindra & Mahindra Financial Services reported a consolidated net loss of ₹1,573.4 crore in the first quarter of the current fiscal against net profit of ₹432.12 crore in the corresponding period in 2020-21.

Total income declined 16 per cent to ₹2,567 crore during the quarter ended June 30, against ₹3,069 crore in the corresponding quarter last year.

To cover any contingencies due to the Covid-19 pandemic, the company carried an additional overlay of ₹2,709 crore (pre-tax) in the standalone financial statements and ₹2,808 crore (pre-tax) in the consolidated financial statements as of June 30.

Noting that the second wave of Covid had a severe impact on the semi-urban and rural markets, where it has major operations, Mahindra Finance said for the first quarter , disbursements dropped 35 per cent on a sequential basis to ₹3,872 crore, though it grew 42 per cent on a year-on-year basis.

Gross non-performing assets were higher at 15.5 per cent as on June 30, compared to nine per cent as of March 31, 2021.

“The company believes that the elevated NPAs are not a reflection of any credit risk increase but are purely delays caused by liquidity situation. Our experience in the past has always shown a return to normalcy by these segments of customers once their earnings stabilise,” Mahindra Finance said in a statement, adding that as the market conditions normalise over the next few quarters.

During the first quarter, it implemented resolution plans to relieve Covid -19 related stress of eligible borrowers in 59,455 loan accounts with a total outstanding of ₹2,172 crore.

Published on July 26, 2021

Follow us on Telegram, Facebook, Twitter, Instagram, YouTube and Linkedin. You can also download our Android App or IOS App.

This article is closed for comments.
Please Email the Editor

You May Also Like