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Muthoot Capital Services Ltd (MCSL) has crossed ₹1000 crore-loan book on the back of aggressive two-wheeler loan financing and diversification into corporate lending.
For the quarter ended March 31, 2016, the net profit registered a 11.53 per cent growth from ₹6.16 crore to ₹6.87 crore. The total income rose to ₹63.41 crore from ₹51.98 crore, registering a growth of 22 per cent. Interest expenditure increased from ₹19.62 crore to ₹22.34 crore.
The yearly results also showed an impressive growth with total income increasing to ₹228.49 crore compared to ₹191.29 crore during 2014-15, recording a growth of 19.44 per cent. The net profit for the year at ₹22.85 crore was higher by 2.5 per cent compared to ₹22.29 crore for the previous year.
According to Thomas George Muthoot, Managing Director, the improved performance was the direct result of a substantial growth in loan disbursements. The company’s foray into corporate and other business loans also helped boost the loan disbursements. The total loan sanctioned for the quarter was ₹314.65 crore. This comprised two-wheeler loans totalling ₹234.76 crore, and corporate and other business loans worth ₹79.89 crore.
The determination of NPA based on a stricter 5-month norm for the year, compared to the 6 month norm in the previous year, led to an increased drag on the company’s profits. The profitability was impacted through reversal of unrealised interest and provisions on NPA, loss on sale of repossessed assets and writing off of assets totaling to ₹19.62 crore as against ₹15.55 crore in the previous year.
In addition, the company has made an additional provision of ₹0.53 crore towards anticipated NPAs in future. However, in spite of all these, the company was still able to improve the profits for the year, he said.
The board also confirmed the interim dividend of ₹5.50 per share (55 per cent) as the final dividend for the year 2015-16.
The innovative “Ladies Only” two-wheeler loans has received overwhelming response, with the company disbursing loans to about 55,000 women totalling ₹250 crore, he added.
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