Shriram Transport Finance Company (STFC) reported a 47 per cent year-on-year (y-o-y) drop in first quarter standalone net profit at ₹170 crore due to increased provisions towards impaired loans and rise in employee benefit expenses.
The company, which is a leading player in the pre-owned commercial vehicle financing segment, had reported a net profit of ₹320 crore in the year-ago quarter.
Interest income was up 9 per cent y-o-y to ₹4,479 crore (₹4,103 crore in the year-ago quarter).
During the reporting quarter, STFC made a net gain on “derecognition of financial instruments under amortised cost category” amounting to ₹101 crore (nil in the year-ago period).
Finance costs were up 10 per cent y-o-y at ₹2,498 crore (₹2,267 crore).
Net interest income (difference between interest earned and interest expended) rose 14 per cent y-o-y to ₹2,107.45 crore (₹1,842.54 crore).
Provisions made towards impairment on financial instruments rose 35 per cent y-o-y to ₹1,440 crore (₹1,065 crore). During the reporting quartet, the company considered an additional ECL provision of ₹261 crore on loans on account of Covid.
The company invoked resolution plan to relieve Covid 2.0 pandemic-related stress of eligible borrowers worth ₹1,434.14 crore. Of this, as on June 30, 2021, it restructured loans of 10,257 eligible borrowers accounts worth ₹342.53 crore.
Gross Stage 3 assets (which are considered credit-impaired) rose about 8 per cent y-o-y to ₹9,658 crore (₹8,931 crore).
As of June-end 2021, assets under management were up 6.75 per cent y-o-y to ₹1,19,301 crore (₹1,11,756 crore as of June-end 2020).
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.