Cholamandalam Investment and Finance on Friday reported a 42% growth in net profit at Rs 192 crore for the March quarter, helped by higher disbursements and reduction in the cost of funds.

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The company had reported a profit after tax (PAT) of Rs 135 crore in the same period last year.

For the full year 2015-16, the company's PAT was up 31% to Rs 568 crore from Rs 435 crore posted last year.

"The profit was driven by pick-up in volumes, stable gross non-performing asset (NPA) numbers and lower cost of funds," Cholamandalam Investment Executive Vice-President and Chief Financial Officer D Arul Selvan told PTI.

The company's aggregate disbursements stood at Rs 4,941 crore in the January-March period as against Rs 3,509 crore in the year-ago quarter.

In the vehicle finance business, the company disbursed Rs 3,760 crore, while home equity disbursement grew by 16% to Rs 994 crore.

The company's gross NPA was at 3.53% (at four months' overdue) and net NPA was at 2.13%.

The company has created an additional standard asset provision for Rs 54.80 crore towards provisioning for three months' overdue, to be complied by March 2018 as per the Reserve Bank of India (RBI) guidelines.

Its net income margin (NIM) was 9.4% for the quarter as compared to 8% last year.

"The NIM was strengthened by a healthy increase in interest income, reduction in the cost of funds and a substantial increase in fee and other income," Selvan said.

The cost of funds declined to 9.6% in the fourth quarter (Q4) from 9.92% in the year-ago period. The capital adequacy ratio (CAR) of the company was at 19.68% as against the regulatory requirement of 15%.